Phil Hogan (Carlow-Kilkenny, Fine Gael)

Before I reply to Deputy Costello on the housing matter, I wish to take the opportunity to acknowledge the work of Deputy Willie Penrose as Minister of State with responsibility for housing and planning at the Department of the Environment, Community and Local Government since 9 March 2011. I thank him for his outstanding work and the interest and knowledge he had of housing matters in particular and the principled position he took on a particular issue. I had an excellent working relationship with him which I deeply appreciate and I wish him well.

The Residential Tenancies Act 2004 regulates the tenant-landlord relationship in the private rented residential sector. My Department conducted a review of the Act in 2009 and the incorrect retention of deposits by landlords was identified in the review process as one of a range of issues that merited specific attention. In July 2011, the Government approved the drafting of the Residential Tenancies (Amendment) Bill 2011. The general scheme of the Bill proposes the introduction of fines where a landlord is found to have incorrectly retained a tenant's deposit, as a first step to eliminating the problem of deposit retention. My Department is currently liaising with the Office of the Parliamentary Counsel regarding the drafting of the Bill.

The programme for Government commits to the introduction of a deposit protection scheme and it is important that action in this regard is taken in the context of a strong evidence base. I have therefore asked the Private Residential Tenancies Board, which is the independent statutory body charged with the administration of the Act, to commission cost benefit analysis-based research on such a scheme and to report back to me with recommendations. I understand that the research will be put out to tender in the coming weeks and I expect that the board will revert to me with detailed research and recommendations by summer 2012.

Previous research on this topic by the PRTB has engaged in comparative examination of schemes existing in a number of other countries but has not included any detailed analysis of the costs and benefits of establishing a deposit protection scheme in Ireland. In line with the regulatory impact analysis guidelines for a proposal of this scale, a detailed cost benefit analysis of how a deposit protection scheme might be applied to the existing Irish system, and the costs arising, should be the initial action. Any new scheme must be integrated into the Residential Tenancies Act. It should be linked to the registration function of the PRTB, and perhaps also to minimum rental accommodation standards. The purpose of this further research is to identify what type of scheme could best suit the Irish market and its costs and operational implications. This will then enable me to make a definitive, evidence-based, recommendation to Government on this matter in due course.

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