Varadkar targets housing crisis on return as Irish PM

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DUBLIN (Reuters) -Leo Varadkar was elected Irish prime minister for the second time on Saturday, taking over from Micheál Martin under a novel rotation arrangement struck between their two parties – once sworn rivals – under a 2020 coalition pact.

Varadkar, previously premier from 2017 to 2020, pledged to speed up government plans to tackle a years-long housing crisis that cost him a full second term in office and has made the left wing Sinn Fein clear favourite to win the next election in 2025.

“We must do whatever it takes to solve this social crisis and reverse the trend of rising homelessness and falling home ownership,” Varadkar told parliament.

“We must apply the same spirit of determination, action and immediacy that we saw during the pandemic to this great challenge,” he said. “We will leave no stone unturned.” 

The 2020 coalition deal – which included the smaller Green Party – for the first time united Martin’s Fianna Fail and Varadkar’s Fine Gael, which are Ireland’s dominant centre-right parties and have led every government since independence a century ago.

Finance Minister Paschal Donohoe and Public Expenditure Minister Michael McGrath are also to swap roles under the deal while Martin will become deputy prime minister and replace Simon Coveney as foreign and defence minister, Varadkar told parliament.

Coveney will take over as minister for enterprise, trade and employment from Varadkar, who left most of the rest of the cabinet unchanged.

Varadkar is also returning to another familiar issue, the long-running dispute between Britain and the European Union on post-Brexit trade rules for Northern Ireland, a British province with a long open border with EU member state Ireland, but polls suggest housing affordability will again dominate his tenure.

With house prices and in particular rents at record levels and still rising rapidly, recent data suggests that an elusive sharp increase in housing supply could reverse next year.

“Teachta (Deputy) Martin argued in his speech that this government is successful. Well the rest of us must be living in a very different Ireland from you,” said Sinn Fein leader Mary Lou McDonald, whose party has led opinion polls by around 10 percentage points for over a year.

“We live in an Ireland where the housing emergency has gotten worse and where households struggle to get by. Surely you cannot count this as success.”

Reporting by Padraic Halpin and Conor Humphries; Editing by Frances Kerry and Mark Heinrich

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