Darragh O'Brien (Dublin Fingal, Fianna Fail) | Oireachtas source

I move amendment No. 1:

To delete all words after “That” and substitute the following: “Dáil Éireann resolves that the Ban on Rent Increases Bill 2021 be deemed to be read a second time this day 12 months, to allow for the Government’s Residential Tenancies (No. 2) Bill 2021, which is due to be enacted shortly and which will provide a change from the 4 per cent per annum rent increase restriction in Rent Pressure Zones to a rent increase restriction requiring that any rent increase cannot exceed the percentage rate of general inflation, to take effect.”.

I will explain the rationale of the amendment as I respond to the Bill. I thank Deputy Ó Broin for bringing forward the Bill again and providing me with an opportunity to outline the actions Government has taken so far in a 12-month period to protect renters. I regret that some of his colleagues have used the opportunity to attack without trying to advance their position. That is fine. One would have previously questioned, as to the timing of the tabling of this Bill, whether it was about renters or about Sinn Féin and the by-election due to be held on Thursday. Having said that, to be fair to Deputy Ó Broin, he has tabled this legislation previously, as recently as last year. I will address it in my response.

I will bring forward further rent reform legislation in the autumn. The Government has tabled a timed amendment to this Bill and will consider it again on Second Stage in 12 months when the impact of the new legislation I have brought forward in respect of increased restrictions by the Residential Tenancies (No. 2) Bill 2021, which passed unanimously last night in Seanad Éireann, has been given time to be felt on the ground. I expect that replacing the current 4% cap on annual rent with general inflation will result in far lower increases for an estimated three quarters of all tenancies in the RPZs. This significant reform will be felt by those renters who are struggling, including individuals, families and pensioners. I speak to these people every day, as I am sure many Deputies do. They are fed up of the insecurity and many would prefer to own their own home. That is why the affordable housing legislation the Government is progressing simultaneously is so important. It provides for a new cost-rental model whereby tenants will pay a minimum of 25% below market rents for secure tenancies. It also provides a pathway to home ownership for those currently paying rents, stuck in a rent trap and who want to get out of it.

The timed amendment we have tabled clearly demonstrates that Government is open to reviewing the position 12 months down the road in consultation with stakeholders and taking any legal advice from the Attorney General. The facts remain the same. A ban on rent increases alone will not increase the supply of rental accommodation. It may have the reverse effect. Supply is a key constraint across public and private. We are addressing that in our housing for all plan. Rents rise when demand outstrips supply.

I am sure Members of all parties and none can agree that, judging from the past 12 months, the Government has been responsive in tackling rental issues. In less than a year, we have enacted four rent protection Bills, backed by financial support to help protect the most vulnerable renters from the impact of the pandemic. A fifth Bill, as I mentioned, is currently making its way through the Oireachtas and I expect it to be passed this Thursday. This demonstrates the seriousness and speed with which the Government is determined to protect renters. The Bill we are bringing forward this week represents the most significant change in rental terms for at least five years.

To stay within the law and serve the sector well, we need to strike a balance between restricting the level of rents tenants are paying and keeping ordinary landlords in the system. We have discussed many times in the House the unintended or, indeed, intended consequences of supply being reduced in the sector, which will further exacerbate the problem. However, some of those who have spoken on behalf of the Sinn Féin Bill have simply ignored that fact because it does not suit their narrative. We must have legislation that is appropriate, based in reality and legal, and that is what we are doing. I will bring forward further measures in the autumn and I propose to keep this Bill under review.

I welcome the support of Members of all parties and none for the changes I have made thus far, which will have an immediate and positive impact. We also firmly need to increase the supply within the sector by way of the provision of affordable rental housing, affordable purchase homes and public homes. The new rent restrictions will take effect upon the passing of the new Bill this week and will result in far lower increases for an estimated three quarters of all tenancies. The harmonised index of consumer prices has shown an average increase of 0.73% over the past three years. The new measure will be impactful for the people experiencing difficulties. As I said, all Senators agreed to the provisions last night. The Sinn Féin response to the Government's amendments to reform the operation of the RPZs is to reintroduce a Bill that has been debated a number of times and does not address some of the legal questions that have been raised in respect of its provisions. Nevertheless, it deserves to be looked at in more detail. We will examine both responses on Second Stage in 12 months but I will quickly respond to them now.

Section 2 proposes to ban increases in rent for existing and new tenancies for three years. Specifically, it proposes that, for existing tenancies, no rent increase will be allowed for three years. For new tenancies, the new rent would be set in line with the RTB rent index for equivalent dwellings in that local electoral area and no increases would be allowed for three years. The ban on rent increases would be subject to an annual review. The Government's response is more comprehensive and targeted. We recognise that some landlords also find themselves on the wrong side of the Covid-19 pandemic. I have heard the main Opposition spokesperson discuss that on many occasions but it does not appear to be recognised in any of the legislation brought forward by his party.

We also must recognise the protected property rights that are in place. Building on the urgent Covid-19 rental protections introduced by Government, the Planning and Development, and Residential Tenancies, Act 2020 provided for temporary modifications to the operation of the Residential Tenancies Act 2004, subject to certain conditions, such that for a period from 11 January to 12 July 2021, a 90-day, rather than 28-day, termination notice applies where a tenant is in rent arrears due to the Covid-19 pandemic and at risk of losing his or her tenancy. The earliest termination date allowed in such circumstances is 13 July 2021. We have now gone further than that by bringing forward proposals, which we hope will have the support of everyone in this House, to extend further, right through to 12 January 2022, the protections for tenants affected most by the Covid-19 pandemic and at risk of losing their tenancy. Some speakers have said we brought no measures forward on rent but they have supported four of the five Bills I introduced. I have also replaced the current cap of 4% on annual rent increases. Rents will only be able to go up, if necessary, in line with general inflation, as recorded in the harmonised index of consumer prices. I will expand on this further in the House on Thursday night, when we debate the Seanad amendments to the Residential Tenancies (No. 2) Bill 2021.

The Government is helping tenants. They are important and we want to protect them and ensure their tenancies are more secure. We will do further work on that in the autumn. Taking account of that, we need to ensure everybody in the sector is treated fairly. I do not believe Sinn Féin's Bill would ultimately help renters. The temporary fix proposed in the Bill would negatively impact on supply and lead to a further loss of individual landlords. Whether people want to admit it, landlords are needed in the sector until we are providing more public homes, cost-rental housing and affordable purchase homes. The exit of more landlords from the market will place further pressure on future rents. The measures in the Bill that passed in the Seanad last night, and which I hope will be passed by this House, provide a timely, effective and proportionate response to help the most vulnerable tenants impacted by the Covid-19 pandemic. As I said, that Bill represents the most significant change to rental terms in at least five years and is the fifth Bill I have brought forward to protect renters.

I thank the Deputies who have used their time to put forward the Bill we are debating as, in their belief, part of the solution to the problems we face. There is no single, silver-bullet solution to rents. There are many solutions and a multifaceted approach is required. That is what the Government is doing. A realistic way of dealing with this would be to assess, over a 12-month period, how the measures we hope to pass tomorrow night, with the support of Deputies across all parties and none, are taking effect. We must have a proportionate response that is not going to impact on supply in the market.

See this speech in context