If he sells the house after returning to Ireland the position will be as fillows:
If the house in the UK was his PPR, it will be xexmpt from CGT in the UK and Ireland (the last 3 years are exempt in the UK and the last 12 months of ownership in Ireland) if he sells within those time limits. If it was not his PPR he will be taxable on any gains arising in the UK, and in Ireland but with a credit for UK taxes paid.
With regard to tax on savings income, yes, he will be taxable in Ireland on this wherever it is earned. The transfer of the funds are irrelevant.
I don't know about the council house implications.