Mary Hanafin (Dún Laoghaire, Fianna Fail)

I propose to take Questions Nos. 95 and 97 together.

The purpose of the rent supplement scheme is to provide short-term income support to eligible people living in private rented accommodation whose means are insufficient to meet their accommodation costs and who do not have accommodation available to them from any other source. In recent years, a significant number of people have come to rely on rent supplement for extended periods. There are currently more than 69,700 people in receipt of rent supplement, almost 32,000 of whom have been receiving a supplement for 18 months or more. For this reason, the rent supplement scheme must be viewed in the context of overall housing policy, particularly in the case of long-term recipients.

I am anxious that all avenues are explored in providing support for those on long-term rent supplementation, including options to support them in securing a home. One of the measures introduced to address this is the rental accommodation scheme, RAS, which gives local authorities specific responsibility for meeting the longer-term housing needs of people receiving rent supplement for 18 months or more on a phased implementation basis. Since 2005, more than 15,800 rent supplement recipients have been transferred to RAS units and other social housing options. The commitment in the programme for Government to the development of a mortgage support system is also being advanced in the context of housing policy, with provision being made in the new housing Bill for an incremental purchase scheme. This scheme will enable existing social housing tenants and households qualified for social housing support to become owners of houses newly built by housing authorities and voluntary and co-operative bodies.

The Department of Social and Family Affairs provides income maintenance support through the mortgage interest supplement scheme. This scheme assists eligible people who are unable to meet their mortgage interest repayments and contributes to the interest portion of the mortgage repayments only. Almost 7,000 people are now in receipt of a mortgage interest supplement.

With regard to the commitment to review the rent supplement scheme and the associated means test, significant changes in the means test for rent supplement were implemented in 2007. Where a person working up to 30 hours per week has additional income greater than the standard weekly rate of supplementary welfare allowance, the first €75 of such additional income, together with 25% of any additional income above €75, is disregarded for means assessment purposes. This ensures that those returning to work or participating in training schemes are better off as a result of taking up such an opportunity. A person accepted as having a long-term housing need under the RAS may engage in full-time employment and still qualify for rent supplement.

Rent supplement is calculated to ensure that an eligible person, after payment of rent, has an income equal to the rate of supplementary welfare allowance appropriate to his or her family circumstances, less a minimum weekly contribution which each recipient is required to pay from his or her own resources. When last set in 2004, the minimum contribution represented approximately 10% of the minimum social welfare weekly payment rate. While social welfare payments have risen by nearly €70 per week since then, no upward adjustment has been made to the minimum contribution. As part of budget 2009, I announced my intention to increase the minimum contribution from €13 to €18 with effect from 1 January 2009. This will represent 8.8% of the basic social welfare weekly payment and will significantly reduce the differential between the contribution paid by rent supplement tenants and the contribution payable under the local authority differential rent scheme.

The fact that more than 69,700 people are receiving rent supplement and the fact that more than 50,000 rent supplements have been awarded since the beginning of this year indicate that the scheme is effective in meeting needs. However, I intend to keep the rent supplement scheme under review, and the Department will continue working closely with the Department of the Environment, Heritage and Local Government in ensuring that RAS meets its objective of catering for those on long-term rent supplementation while enabling rent supplement to return to its original role of a short-term income support.

See this speech in context