Clare Daly (Dublin North, Socialist Party) | Oireachtas source

I wish to make some brief points from a couple of standpoints. It is necessary to consider the interest of the tenant and of the local authority and also the overall situation in the real-world rental market.

Other Deputies are correct in highlighting the current situation. I refer to the recent report in the media about the rise in private rents which has vindicated what all of us knew and have been saying for a long time. The banks are not lending money for new mortgages so it is inevitable that rents in the private rental sector are rising. The figures are quite stark. The average rent for any property in the State is €815 per month. The gap between the urban and rural areas which has been highlighted by other Deputies, has been growing steadily over the past number of years. There is now a serious disconnection in our system and for which ordinary tenants are paying the price. I will not list the rents and maximum permitted rents in the various local authority areas. Suffice to say that it is only in the four Dublin local authority areas that an amount over the average house price is allowed for which is for the biggest three-bedroom house type. The figures allowed in other parts of the country are falling well short. I will not repeat the points, only to say that this is the cause of significant financial and emotional stress for many families. There are many cases where people have fought to get private rented accommodation in their area but they have been unable to meet the demands from the Department of Social Protection to have that rent lowered. They are then forced to move out of the area which results in a disconnection of other aspects of family life. For example, a lone parent of a child with special needs may have to remove the child from the local school because staying in the area is not a reality. There is a disconnect between different Departments and this is having a significant impact on people who are renting.

What is happening in the private rented sector feeds into the Minister's overall housing policy. Clearly this Bill is a step in that process of handing over the management of rent supplement to the local authority. We have to take this into account. There are positive aspects to that move. It is a good thing that local authorities would be charged with the management of all housing accommodation. However, there are also significant dangers if sufficient resources are not provided. It also reflects a moving away from the idea of direct provision towards housing support which, in my view, is not adequate. We have already highlighted that the supports have been inadequate. People are moving from secure, relatively permanent, decent accommodation into much more flexible, transient and less regulated accommodation with far less security of tenure. That is a difficulty which needs to be examined. Against that backdrop, those who have a council house and who are the beneficiaries of this Bill are the lucky ones. The differential rents system, whereby one's rent is linked to ability to pay, is a good system which should be protected. However, in recent times the increases in local authority rents is a concern. I have no doubt that the Department will deny it but the word on the street in the local authorities is the reason for the rent hike is to cover the demands being put on local authorities for the new home tax which they need to recoup elsewhere. They are already grappling with tenants who have large enough volumes of arrears. We need to be cognisant that an increase in rent will not help that situation. We need to factor in the issue of the impact on the maintenance of housing stock of other cutbacks at national level. This scheme proposes a streamlining of local authority rents around the country. This is welcome, as is the plan to fix those rents at 12% to 15% of income. Allowing councillors a flexibility in deciding those amounts is a very good proposal. We have long argued that the removal of powers from councillors has been a retrograde step. It is essential that more power be devolved to local authorities. I would prefer to see it go further. We have to dig deeper.

If councils are to have the power to set rents at these levels and to impose increases then this must be considered in the context of the overall management of housing stock and the anomalies that have arisen. I refer to Fingal County Council, the one I know best. It currently charges tenants €3 a week for boiler maintenance, amounting to €150 a year on top of rent. I do not pay that much; it is an astronomical price for boiler maintenance. The council says it has no option. Local authorities cannot absorb the price of repairs because their central budgets have been cut. Many local authority houses have windows and doors in poor condition. It annoys the tenants of such houses to see vacant houses being refurbished with new windows, doors and insulation to create energy-efficient houses for new tenants. The loyal tenant who may have been a tenant of the local authority for years will ask, "What about me?"

We need joined-up policies. Last Friday, the Minister for Communications, Energy and Natural Resources, Deputy Rabbitte, launched something - I am not sure what he was launching because he seems to launch something every day of the week. He issued a few press releases to argue correctly that energy-efficient homes are the long-term solution to fuel poverty. What about our housing stock? The windows are draughty and people are spending more just to keep themselves warm because local authorities are not being adequately funded to bring those houses up to standard.

These things feed into the overall change proposed to local authority powers to set and streamline rents. There are very big differences. For example, in relation to local authority dwellings that have been taken over but are being run by management companies, the tenant not only pays rent to the local authority but also pays a €10 or €15 management fee. For someone on a social welfare income, it is a highly onerous demand. In discussing changes in this area, we must examine the larger picture. There is no point in providing local authorities with the power to increase rents if it means it will drive someone over the edge. The only result, apart from the stress on the person, will be an increase in arrears. I would like to see how this fits in with the whole area of incentives or initiatives to bring housing stock up to an adequate standard to meet the new regulations. What will happen where a tenant is in a position to improve the state of a house and would like to invest in it? Can we link the rent system with an ability to improve the housing stock for the benefit of everybody?

There is nothing hugely wrong with the Bill. I have some questions about the move to an over-reliance on support as opposed to direct provision, which has stood the test of time and been a desirable mechanism for providing people with a stake in their communities. There are a great many unwilling landlords who bought homes they cannot afford to live in and are now renting out. They would get rid of them if they could but, because of negative equity, they are afraid of the debt they will have if they walk away. Presumably, the State could do some deal with the banks to take over those units while writing off the debts of the owners to allow us to improve the housing stock and create security of tenure. There is an overemphasis and reliance on the private market.

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