Paul Kehoe (Wexford, Fine Gael)
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Question 122: To ask the Minister for Social and Family Affairs if she will reform the rent supplement scheme; and if she will make a statement on the matter. [34806/08]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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The purpose of the rent supplement scheme is to provide short-term income support, to eligible people living in private rented accommodation whose means are insufficient to meet their accommodation costs and who do not have accommodation available to them from any other source. Over 45,500 rent supplements have been awarded since January 2008.

In recent years, a significant number of people have come to rely on rent supplement for extended periods. There are currently over 68,000 people in receipt of rent supplement, an increase of 14% since the end of December 2007. Almost 32,000 are getting a supplement for 18 months or more. For this reason, the rent supplement scheme has to be viewed in the context of overall housing policy, particularly in the case of long-term recipients.

The Government introduced new rental assistance arrangements which came into effect in 2005 and included the rental accommodation scheme (RAS). The RAS gives local authorities specific responsibility for meeting the longer-term housing needs of people receiving rent supplement for 18 months or more, on a phased implementation basis. Since 2005, over 8,300 rent supplement recipients have been transferred to RAS units and a further 7,500 have transferred to other social housing options, following their assessment for RAS.

Significant improvements to the means test for rent supplement were implemented in 2007 specifically to facilitate people returning to full-time work who had been accepted as eligible for accommodation under RAS. These measures are positive steps in assisting tenants in achieving a long-term housing solution for their needs.

Other improvements to the rent supplement means test were implemented in June 2007 providing for a gradual withdrawal of the supplement as hours of employment or earnings increase. Where a person has additional income in excess of the standard weekly rate of supplementary welfare allowance, the first €75 of such additional income together with 25% of any additional income above €75 is disregarded for means assessment purposes. This ensures that those returning to part-time work or participating in training schemes are better off as a result of taking up such an opportunity.

Rent supplement is calculated to ensure that an eligible person, after the payment of rent, has an income equal to the rate of supplementary welfare allowance appropriate to his or her family circumstances, less a minimum weekly contribution which each recipient is required to pay from his or her own resources. When last set in 2004, the minimum contribution represented approximately 10% of the minimum social welfare weekly payment rate. While social welfare payments have risen by nearly €70 per week since then, no upward adjustment has been made to the minimum contribution.

As part of Budget 2009, I announced my intention to increase the minimum contribution from €13 to €18 with effect from 1 January 2009 which will represent 8.8% of the basic social welfare weekly payment. It will also significantly reduce the differential between the contribution which rent supplement tenants pay and the contribution payable under the local authority differential rent scheme.

The fact that there are over 68,000 people receiving rent supplement and the fact that over 45,000 rent supplements were awarded since the beginning of this year indicate that the scheme is effective in meeting needs. However, I intend to keep the rent supplement scheme under review and the Department will continue working closely with the Department of the Environment, Heritage and Local Government in ensuring that RAS meets its objective of catering for those on long term rent supplementation while enabling rent supplement to return to its original role of a short-term income support.

Liz McManus (Wicklow, Labour)
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Question 123: To ask the Minister for Social and Family Affairs the outcome of her deliberations in respect of the proposed introduction of a new family payment to support children in low income families. [34884/08]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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The Government discussion paper, "Proposals for Supporting Lone Parents," put forward proposals to tackle obstacles to employment for lone parents and other low income families. These included proposals for the expanded availability and range of education and training opportunities for lone parents; the extension of the National Employment Action Plan to focus on lone parents; focused provision of childcare; improved information services for lone parents and the introduction of a new social assistance payment for low income families with young children. Under the proposals the lone parenthood category of payment would no longer exist. Instead, a new payment would be made to all parents (living alone or with a partner), with young children, on low income. This new payment is currently being developed in the Department, taking into account the various issues raised in the consultation process.

Any proposed new payment scheme can only be introduced when the necessary co-ordinated supports and services are put in place on the ground by other relevant Departments and Agencies. This is why the Senior Officials Group on Social Inclusion has been tasked with bringing forward a plan on the key issues of childcare, education, training and activation measures.

The non-income recommendations contained in the discussion paper were examined in two areas: Coolock and Kilkenny. These studies, which took place between November 2007 and February 2008, were carried out to facilitate the development of the policy and operational details of the new scheme. The process involved both lone parents and qualified adults. It was carried out on a voluntary basis and the take-up was low.

The experience has however highlighted how both lone parents and qualified adults are not a homogenous group, are of different ages, have experienced different routes into their current situation and have different needs. Educational levels of those who participated were generally low, there was little or no engagement with FÁS, some participants intended to return to full or part-time work when their child was a few months old; others, however, had been out of the work force for a considerable period of time. Earnings from previous employment were generally low. For almost all of those intending to return to work affordable childcare was a critical issue.

The experience of this engagement process is feeding into the development of our approach to working with lone parents and qualified adults to support them into education, training and employment.