Séamus Brennan (Dublin South, Fianna Fail)

I am conscious of the need to facilitate those in receipt of social welfare payments taking up employment opportunities and to ensure that social welfare supports are structured to support this objective. A number of progressive measures have been introduced in recent years aimed at removing disincentives for people wishing to take employment and to assist in the transition from welfare to work. These measures include easing of means tests through income disregards, tapered withdrawal of benefits as earnings increase and employment support schemes such as the back to work programmes. As a result, rent supplement recipients are generally better off at work.

Under standard assessment rules, rent supplements are calculated to ensure that an eligible person, after the payment of rent, has an income equal to the rate of basic supplementary welfare allowance appropriate to his or her family circumstances, less a minimum contribution to rent. The minimum contribution is €13, which each recipient is required to pay from his or her resources.

Where a person has an additional income as a result of participation on a training course or in part-time employment, which is up to 30 hours per week for this purpose, the standard means test now provides for a weekly disregard of up to €60 per week of additional income and half of any additional income between €60 and €90. For those participating in approved training courses, any lunch or travel allowances that are paid may also be disregarded.

In addition, certain training courses now provide a child care allowance to participants on certain courses. The recent budget provided that these child care allowances are to be treated in the same manner as a lunch or travel allowance and are disregarded. The effect of these arrangements is that a rent supplement recipient taking up part-time work can be up to €15 per week better off as a result.

With regard to people taking up full-time work, under special retention arrangements which have been in place for several years, a person is allowed, subject to certain conditions, including a weekly income limit of €317.43, to retain a portion of his or her rent supplement on a tapered basis for up to four years where he or she takes up employment through approved schemes, such as the back to work allowance scheme or community employment scheme. In addition, a person who has been unemployed for 12 months or more and who moves from a welfare payment to full-time open market employment may retain his or her rent supplement payment, subject to the €317.43 income limit, on the same tapered retention basis.

While the objective of rent supplement is to provide short-term income support as opposed to addressing long-term accommodation needs, a significant number of people have come to rely on rent supplements on a long-term basis in recent years. As Deputies are aware, the Government announced a new initiative in July 2004 aimed at meeting these long-term housing needs. The new system gives local authorities responsibility for meeting long-term housing assistance needs, including the needs of those people on rent supplements for 18 months or longer.

Overall, I consider that the current rent supplement eligibility thresholds and disregards, together with improvements in the standard rules of the supplementary welfare allowance scheme, ensure that people have real financial incentives to take up employment opportunities. Furthermore, the rental assistance arrangements announced by the Government in July 2004 will in time address the housing requirement of those who have come to rely on rent supplement to provide for their long-term needs. Like other forms of social housing, these new arrangements will be based on fair rents that support people taking up employment.

See this speech in context