Central Bank boss and Housing Minister at odds over Government plans to ease lending rules around housebuilding 

The governor of the Central Bank reiterated advice which he had given to Mr Browne last month that the Government should prioritise investing in making sure there is land available for development adding that infrastructure is where he would put a particular focus.

"We published a report before Christmas, in October or September, specifically on housing where we made clear — and I am happy to repeat it now — that the number one issue on housing is not finance. The number one issue on housing is planning," said Mr Makhlouf.

"It is absolutely planning. This is not a unique situation in Ireland but planning is the problem."

Mr Makhlouf went on to say that he would be putting all of his energy into making sure that planning rules are being implemented in a way that supports the construction of housing.

However, Mr Browne strongly disagreed with Mr Makhlouf stating that finance is a real issue when it comes to housing, especially in the private sector.

It is the Government's job to look at every measure possible to deliver housing including looking at the finance required, he said.

Large-scale apartment building is needed in Dublin city centre and it is here that Mr Browne said "finance is simply broken".

If it was working currently then the apartments that are needed to meet demand would be being built.

"Planning is an essential part, and we do need more zoning, but planning is not really the issue in Dublin city centre and it is Dublin that is dragging the whole housing delivery back where there is a lack of delivery of apartment blocks," said Mr Browne.

"That is a financing issue, that is not a planning issue."

He said there is a need to open up planning, particularly in areas around Dublin city but it cannot become about sprawl for housing.

"We need apartments and we need them in Dublin city centre," he said.

The pair were speaking following reports in the Irish Independent on Monday that the Government is working on plans to lower the amount of funding that builders have to invest while being able to borrow more.

Mr Makhlouf and Mr Browne are scheduled to meet in the coming weeks.

Meanwhile, Labour's housing spokesperson Conor Sheehan labelled any attempts to loosen lending rules for apartment developers a "dangerous regression to Celtic Tiger failures".

"Apartment construction has plummeted, and instead of taking proper charge, the Government is opting for superficial solutions," said Mr Sheehan.

"This proposal does nothing to tackle the root problems —namely, the soaring costs of building apartments and exorbitant land prices."