Séamus Healy (Tipperary South, Workers and Unemployed Action Group)
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The new prescribed income limits for local authority housing are completely and absolutely inadequate and are placing families in difficult situations in which they can be approved neither for local authority housing nor for local authority mortgages or, indeed, mortgages from other lending agencies. If I gave an example of what I am talking about, it might clarify the matter. I hope the Minister will take this into consideration and significantly increase the prescribed income limits.

The example to which I refer is a family of four consisting of a husband, wife and two children. The husband is working full-time for about €11 per hour, which is the equivalent of a take-home pay of €438 per week or €22,776 per annum. The family, which is obviously on a low income, is also in receipt of family income supplement of €99 per week. The wife is a full-time housewife who does not work outside the home. The family holds a medical card and is currently paying €150 per week to a landlord for private rented accommodation. They receive no rent supplement because the husband works full-time. Their take-home income, including the family income supplement, is €537 per week, but after paying €150 per week in rent, their net income is €387 per week, which is similar to the minimum wage. This must cover the ongoing day-to-day expenses of a husband, wife and two children.

That family is €500 over the income limit for local authority housing. In addition, they cannot be approved for a mortgage because the husband is not earning enough. The family would be better off with no wage earner; taking into account the €150 per week rent, they would be better off in receipt of jobseeker's allowance or benefit. They are in limbo, unable to be approved for a house or obtain a mortgage. They are stuck in a situation in which they are on a very low income but must still pay €150 per week with no rent supplement.

This is unsustainable and is causing significant difficulties for large numbers of housing applicants. I hope the Minister will consider this and increase the prescribed income limits significantly to ensure families with wage-earners on low income can be approved for local authority housing.

The cases of applicants who were approved for housing prior to 1 April, the date on which the new regulations were introduced, are now being reviewed. I hope the Minister will agree that those who were approved for local authority houses before 1 April should retain their approval and be housed in the normal way. I ask the Minister to consider increasing the income limits significantly.

John Perry (Sligo-North Leitrim, Fine Gael)
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I thank Deputy Healy for raising this important issue. I am taking this matter on behalf of the Minister for the Environment, Community and Local Government, Deputy Hogan, who conveys his apologies to Deputy Healy as he is unable to attend due to official Government business abroad.

I start by emphasising that the prescribed income limits referred to by the Deputy are solely for the purpose of determining eligibility for social housing support and have no bearing on access to mortgages from local authorities or financial institutions.

Prior to the enactment of the Social Housing Assessment Regulations 2011, most, though not all, local authorities operated some sort of income eligibility criteria for access to social housing support. The manner in which these were enforced varied from place to place. I listened to Deputy Healy's points about the difficulties these income limits cause. There were also significant differences in how income limits were defined. Some related to gross income; some made an allowance for rent being paid. Some included all income, including child benefit and so on, while others disregarded a range of different sources of income. The result of this was considerable inconsistency in the way in which social housing was allocated, which meant that applicants for support who were on similar incomes could be treated very differently because of where they happened to live. This was neither equitable nor efficient. On 1 April 2011, parts of the Housing (Miscellaneous Provisions) Act 2009 dealing with social housing support were commenced and a new standard procedure for assessing applicants for social housing was introduced in every housing authority. This includes a requirement that applicants only need to apply to one housing authority to be placed on up to three waiting lists, provides for the use of a standard application form and sets maximum net income limits based on the cost of housing in the area in question. The ultimate aim of the new system is to create a fairer, more consistent and transparent approach to eligibility for social housing support.

The new maximum income limit is clearer and fairer, being a fixed figure depending on the size of the household. The income for eligibility purposes is gross household income less income tax, PRSI and the universal social charge. Child benefit and several temporary incomes are also disregarded.

The income limits are set out in three bands and each housing authority is assigned to one of these bands. Assignment is based on an assessment of the income needed to meet a household's basic needs in the area of choice having regard to local rental costs. Accordingly, the three bands take account of the variation in the cost of private rented accommodation across the country. The principle behind determining what is reasonably affordable for any household is the relationship of household income to the cost of providing suitable accommodation in the private sector, particularly rented accommodation. These levels had been set by reference to what is generally accepted as affordable in terms of a proportion of net income.

When the Minister of State, Deputy Willie Penrose, came into office, he decided the income limits should be increased across the board by €5,000. This was not done primarily for reasons of affordability but to create a wider catchment group from which social housing tenants are drawn, in order to promote sustainable communities. The figure for net income of up to €35,000 for a single person household, corresponds to a gross income of almost €50,000, and is considered sufficient to secure accommodation within the private rental market or even, in some cases, to meet the costs of a mortgage. Higher gross income thresholds apply to multiperson households.

Given the cost to the State of providing social housing, it is considered prudent and fair to direct resources to those most in need of social housing support and who are unable to provide for their accommodation needs from their resources. The current income eligibility requirements achieve this.