Paul Murphy (Dublin South West, Anti-Austerity Alliance)
Link to this: Individually | In context | Oireachtas source

11. To ask the Minister for Social Protection in view of the record high level of rent in the private rented sector if his Department will increase the rent limits for rent supplement; and if he will make a statement on the matter. [28790/16]

Paul Murphy (Dublin South West, Anti-Austerity Alliance)
Link to this: Individually | In context | Oireachtas source

Rents continue to rocket. Rent supplement levels have been increased - although not sufficiently because they have already been overtaken by rising rents. In view of the latter and the fact that people cannot access properties within rent supplement limits is a driving factor in the rise in homelessness, does the Minister agree that those limits should be increased?

Leo Varadkar (Dublin West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Supports relating to housing are a key priority for this Government, as evidenced by the early implementation of our commitment to introduce increased rent limits under the rent supplement and housing assistance payment, HAP, schemes. The increased limits were introduced from 1 July 2016. The rent supplement scheme assists 50,700 tenants at a cost of €267 million this year. The review process undertaken represented a realignment of the maximum rent limits with agreed rents, with rents generally benchmarked against the 35th percentile of those registered with the Residential Tenancies Board. The review's methodology is evidence-based and reflects the pressures on rental properties in each location. Rents were increased by a weighted average increase of approximately 30% in the Dublin area.

In recognition of the ongoing difficulties in the rental market, my Department continues to implement a targeted, flexible, case-by-case approach where rents may exceed the maximum limits. Approximately 10,000 people have been given rent supplement above the maximum limit. The protocol arrangement in place with Threshold continues to operate in the areas where supply issues are particularly bad, covering Dublin, Cork, Meath, Kildare, Wicklow and Galway city. The number of requests for increased rental payments for rent supplement customers has reduced dramatically following the introduction of the new limits in July. These measures along with the reforms to the private rental sector, notably that rent reviews can only take place if it has been two years or more since the previous review, will provide increased certainty and security for tenants and landlords. I am continuing to keep the matter of rent limits under close review.

Paul Murphy (Dublin South West, Anti-Austerity Alliance)
Link to this: Individually | In context | Oireachtas source

The evidence is there and it is clear that the maximum rent limits do not enable people to rent homes. This comes to me mainly from people who are made homeless or threatened with homelessness for whatever reason in their current accommodation. When they are encouraged to seek other accommodation within the rent supplement limits or slightly above them so they can look for a variation, people invariably say they cannot find anywhere.

This morning I looked on a website for properties suitable for a couple in Dublin - not Fingal - with €900 as the maximum rent limit. There is nowhere appropriate. For a couple with one child the maximum limit is €1,250 per month and there are zero places available. For a couple with two children needing a two-bedroom place with €1,275 as the limit, there is one place available. For a couple with three children and a rent limit of €1,300, no places are available. As suitable properties are unavailable, does the Minister not see that the rent supplement limits must be increased?

Leo Varadkar (Dublin West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

As has been the case for quite some time, if people cannot find a place, they may apply for a top-up to the rent supplement. Until July, when the rent supplement was increased, that was happening on an almost daily basis and 10,000 people were in receipt of top-ups. The number requesting top-ups has since fallen dramatically, indicating that the real problem is a lack of supply. That is the underlying problem, so continuing to increase the rent supplement will drive up rents even further.

What actually needs to be dealt with is the issue of supply. For seven years no social housing was built in this country because the Government was broke and the private sector did not build any houses either because the banks and construction industry were broke. We now have a plan being driven by the Minister for Housing, Planning, Community and Local Government, Deputy Coveney, to turn that around, to build lots of social housing and to get the private sector building again. That is where the solution lies.

Paul Murphy (Dublin South West, Anti-Austerity Alliance)
Link to this: Individually | In context | Oireachtas source

The fundamental solution is to increase the supply, there is no question about that. However, I do not think the Government has a solution in terms of supply. The previous Government built less social housing than any Government in the history of the State and this Government is committed to a market-led solution. What we need is massive public building of social housing using the resources of NAMA and so on.

While we wait for these houses to come on stream, and it is questionable whether they ever will, we have a crisis right now because of the incredible price of rent. While the fact that people can access a top-up is an improvement on the previous situation, it is not ideal that people must make a case for themselves to an official, who then decides yes or no. People should have a right to rent supplement or whatever is needed in order that they can have access to a home.

Statistics were released recently which showed that in Dublin 24, for example, if a person on the minimum wage were to spend 30% of his or her income on rent, which is the recommended percentage, he or she would have to work 84 hours per week. The prices are completely out of control and people simply cannot access housing. Increasing the rent supplement limits now would make a real difference to people.

Leo Varadkar (Dublin West, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Actually, I am not sure that it would. I was quite sceptical as to whether increasing the rent supplement limits would make a difference. However, we said that if we were going to do it, we would do it properly and that is why the increases were so big. They averaged 15% but were 30% in some places and even more than that for some categories of family. In many cases, the limits are at or even above what they were the last time that rents peaked. I am not sure that just putting them up again would work because it will not make one additional house or apartment available. It will just change the dynamic among the people who are competing to get the one house or apartment that is available. That is why the solution has to be based on increasing supply and making better use of properties that are vacant or not used at all. In addition to that, we must move towards the housing assistance payment, HAP, scheme which allows for much higher payments than is the case with the rent supplement scheme. HAP starts in Dublin next year.