Caít Keane (Fine Gael) | Oireachtas source

I welcome the Minister of State and the debate on the private rented sector. Historically, the private rented housing sector was described as the forgotten sector. The Minister of State is changing that perception and the sector can no longer be described as such.

The area received little policy attention and as a result the role of private rented accommodation in the housing system went into decline. Ireland has traditionally had a very high owner occupancy rate compared with peer countries. By the 1990s, when it peaked, four out of five households had purchased their residence. The reasons for the strength of the owner-occupied sector can be attributed to cultural and historical factors that have led to a strong desire on the part of Irish people to own their dwelling - "the field" was very important - rather than rent or lease it. However, this trend has started to reverse in the last five years, no doubt as a direct result of the property crash that began in 2008. Over the five years to 2011, Ireland not only fell to the EU average of 73.5% home ownership, but crashed through it. Fewer than 70% of homes in Ireland were owned by their occupants on census night in April last year, demonstrating quite dramatic change in home ownership in Ireland.

Traditionally, Government policy on housing has had two goals - to provide adequate housing for all and to promote owner-occupation. As the 1970s and 1980s passed, the goal of promoting home ownership began to take precedence to an excessive and unbalanced extent and culminated in a bloated and unsustainable property sector that inevitably crashed in 2008. Some people say we were all responsible. Most of us were, but not all. Not everybody bought a property. The housing market now is undergoing the most significant and seismic change since the foundation of the State. The Government faces the challenge of supporting the transition to a mixed-tenure market that does not prioritise one form of housing tenure over another, that recognises that households' housing needs will change over time and that provides a safety net to assist the most vulnerable to find housing solutions to meet their needs at a particular point in time. We are all aware of the little matchbox apartments that were built in the city centre. People are now stuck in them, with no way or means to get out of them. That is a sector we must cater for as well.

The critical role of the private rented sector in this regard is explicitly recognised in the Government's 2011 housing policy statement. There has been rapid growth in the size of the private rented sector, from 156,000 households in 2006 to 305,000 in 2011, according to the Central Statistics Office, CSO. It is imperative that there be acceptable minimum standards. These have now been put in place and, indeed, they were being put in place under the last Government. It is also imperative that those minimum standards are implemented. The first major reform to the sector was introduced in 1992. Further reform has been taking place over the years.

Over the last 20 years, since the first minimum accommodation standards were set down, our expectation as to what constitutes acceptable housing has advanced. As the Minister outlined, on 1 February 2008 the housing standards for rented houses regulations expired, and landlords were given four years to implement the standards set down under the previous Government. I compliment the Government on introducing them at the time because what tenants had to put up with was pathetic. The regulations removed the substandard accommodation which had not been modified or updated for years. Some of it even dated back to the 1950s. A Senator related to me today how he went up the stairs of a house and could see the sky peeping through the structure. That is no longer acceptable. The new regulations will have a most positive impact on studio flats, apartments and bedsitters that are to be found in period dwellings.

Enforcement of these standards is a key challenge for the local authority sector but I am satisfied that the new standards provide for much strengthened sanctions and enforcement. The penalties for non-compliance with the regulations can amount to a fine of ¤5,000 and/or imprisonment for up to six months. Many of us come from the local authority sector and we are aware that rules and regulations must be enforced. The Minister has provided some funding for this to ensure that inspections can take place. I have the figures for inspections. In 2011, for example, more than 2,500 improvement notices were issued by local authorities and, while most compliance issues were addressed, 60 prohibition notices were served. Dublin City Council is particularly active in this regard and it initiated approximately 40 prosecutions in 2012 under the standards regulations. South Dublin County Council, of which I was a member, has also been quite active, even though it would not have the same capacity of rented accommodation as Dublin city. However, it carried out 5,192 inspections on rented properties from 2005 to 2011.

The allocation of funding to local authorities for this area increased significantly between 2005 and 2011, rising from ¤1.5 million to ¤4 million. The Minister has stated previously that in 2012 her Department allocated a total sum of ¤2.4 million to housing authorities for the purpose of carrying out their functions under the Housing Acts with regard to rented accommodation. Clearly, funding from the Department is being maintained in this area. The upkeep of minimum standards of accommodation in the private sector cannot be neglected.

The Minister spoke about the Private Residential Tenancies Board, PRTB. That was introduced by the previous Government in 2004. It was a very necessary initiative. It has played its role well since its establishment. It is a significant reform that could not escape reference in a debate on the private rented sector, as it was of profound significance. There are also provisions in the Act for a dispute resolution service through the PRTB. This is a very valuable initiative as well. The Act also sets out clearly the statutory tenancy obligations of landlords and tenants' powers to address anti-social behaviour. This is an area that must be given huge attention. In the past week there was media coverage of an estate in County Clare which people were afraid to visit due to anti-social behaviour. The hand of the local authority is strengthened in this regard to ensure that people cannot run riot in estates.

In recent years, the State has taken on a major role in the private rental market through the rent supplement scheme. The Department currently funds approximately 30% of the private rented sector. The rents are kept under review and reflect current market conditions. There are approximately 90,000 persons in receipt of rent supplement, for which the Government provided ¤436 million in 2012. Revised maximum rent limits came into force on 1 January 2012 and are in place until June 2013. I understand these limits were set after an analysis of the most up to date market data available for private rented accommodation. It ensures that accommodation can be secured by tenants under those limits. The Department of Social Protection continues to work with rent supplement tenants to ensure that their accommodation needs are met and that there will not be an increase in homelessness. The Minister has dealt with that and I will not reiterate what she said.

I wish to refer to the shared ownership scheme. I realise it has been suspended due to the reality of market conditions. However, there is a clause in the shared ownership agreement which prevents co-owners from sub-letting. People who have secured jobs in other areas of the country or even in England or elsewhere cannot let out their shared ownership, but must pay their mortgage. This is not fair or right. We always talk about what we can do for mortgage holders. These people are mortgage holders with the local authority. They are tied into this situation through no fault of their own. It was attractive at the time, but it is not attractive now. Their houses and apartments are now empty because of this clause. It should be revoked and the reality of market conditions should be acknowledged.

The Minister mentioned the report on deposit retention. The previous speaker dwelt on the situation of landlords. As he said, they are providing accommodation which the State would otherwise have to provide. It is important that the rights of the landlord, as well as the rights of the tenant, are protected. Where tenants move away leaving big debts, the bill should follow the tenant. They should not be able to proceed to clean out another landlord in the same way as they cleaned out the last one. It can become a vicious cycle. We talk about money following the patient but the bill should follow the patient too in the housing context, rather than leaving the landlord stuck.

The Minister has inherited the tax situation regarding landlords. It is an area that must be examined. Commercial business can offset rates for businesses against income, but landlords cannot do this because rent is not regarded as earned income. It never was. The Minister has not been in office for long and has not yet examined this. That was always the situation, but if it is a rental business-----