Church or State-owned lands will not be confiscated or taken over without payment, according to the Minister for the Environment, Mr Dempsey.

The Department was talking about church or State lands "being made available as a first option to local authorities for purchase at reasonable rates and agreed valuations, not confiscation or providing land gratis".

He was responding during Question Time to Mr Brian Hayes, Fine Gael's housing spokesman, who said it was time for the Department to set up a unit to audit State-owned lands and to discuss regularly with other departments how non-utilised State lands could be given over for local authority housing.

Mr Hayes had asked if he had a scheme in mind which would require the churches to give their lands "gratis" to the State or "is he seeking a discount rate for local authorities or voluntary housing associations should they purchase such lands?"

The Fine Gael TD for Dublin South-West said it was hypocritical of the State to ask the churches to produce land for houses when the State was the largest landowner. He said the Army had bases throughout the State and much of its land was not utilised. "CIE is another example. It has large land bases which are not being utilised."

Mr Dempsey said the Department had written to the Irish Episcopal Conference seeking a meeting about the possibility of making "surplus" lands available for residential use or development. He told Mr Hayes he had contacted the Catholic Church and the Church of Ireland but was not aware of any "huge land holdings held by the smaller religions".

The Minister said the establishment of a land audit unit was under way. "We have received huge co-operation from the Department of Defence which is probably the biggest landowner. The Department of Finance, I understand, is also in the process of completing an audit of lands in the possession of the State."

They were trying to establish, through the local authorities, the amount of land that was available, particularly in built-up areas. He had met county managers and lo cal authorities throughout the State and a number of other meetings were due to be held.

The Department wanted to have "first bite of the cherry in securing the land. Initially there was a fear among State agencies, particularly State and semi-state bodies, that we had in mind confiscation of the land or taking it over without paying."

He added, however, that that was not the case and "we tried to make that clear all along. The message is finally getting through and we are now getting much more co-operation."