The Minister for the Environment, Noel Dempsey, has denied "giving in" to the construction industry by proposing an amendment to a controversial section of the new Planning Bill. Trade Unions have described the amendment as a "back down", but the Irish Home Builders Association believes it will have little effect. Mr Dempsey insists the basic principles of the Bill are still intact. The changes are to a radical Government proposal to provide social and "affordable" housing. Government sources said that changes being considered would introduce a greater degree of flexibility as to how builders might meet the requirements of the Planning and Development Bill, which is currently going through the Seanad.

Under the current draft legislation, local authorities would have the power to purchase up to 20% of land zoned for development at agricultural rates of about £3,000 an acre. The local authority would then build its own social and "affordable" housing. The proposed amendment will allow property developers to sell the finished houses to the local authority at a profit. However, the local authority would still have the option of buying the land at the existing use value.

The amendment would head-off a clash with the Irish Home Builders Association which has warned that, if adopted as it stands, the Bill would drive up house prices by a quarter. The Minister is to meet with the association before the amendment is brought before the Seanad next week.