Tuesday, 21 February 2012
Department of Social Protection
Social Welfare Code
Question 380: To ask the Minister for Social Protection further to Parliamentary Question No. 101 of 8 February 2012, if it is credible for rent supplement not to be considered a competition issue given that it effectively benchmarks rental rates for private rented accommodation; and if she will make a statement on the matter. [9752/12]
The State plays a major role in the private rental market through the rent supplement scheme. As the Department currently funds approximately 40% of the private rented sector it is essential that State support for rents are kept under review, reflect current market conditions and do not distort the market in any way. It is essential that rents are allowed to stabilise from a natural balance of supply and demand, rather than as a result of a price floor funded by the taxpayer.
Rent supplement costs are managed by reviewing and setting maximum rent limits for each county, with the premise that there is adequate supply at or below these levels whilst at the same time ensuring that persons in full-time employment, especially those on low incomes, can enter the private rental market and secure accommodation in their preferred area of choice.
During the recent rent limit review the Department aligned maximum rent limits to reflect availability in each county for those seeking rent supplement support. The new limits have been designed to follow the market, not to distort or force the market in any way. Rent supplement’s maximum limits are not calculated to offer a benchmark to landlords – the most recent review has ensured that this will remain the case.