Tuesday, 17 June 2014
Department of Environment, Community and Local Government
Private Rented Accommodation Deposits
79. To ask the Minister for Environment, Community and Local Government if he will provide an update on the development of legislation to provide for a deposit retention scheme to protect tenants from the illegal withholding of security deposits by landlords. [25448/14]
The Programme for Governmentincludes a commitment to establish a tenancy deposit protection scheme. On foot of this commitment I asked the Private Residential Tenancies Board (PRTB) to commission research on such a scheme and to report back to me with recommendations in that regard. The subsequent report assessed a number of different options for delivery of a scheme ranging from one where all elements are delivered by the PRTB to one where all elements are outsourced to a private operator. The report examined each option in terms of both insurance and custodial type schemes.
In a custodial scheme, tenancy deposits are transferred to the scheme for the duration of the tenancy. They are then repaid by the scheme operator following agreement between the landlord and tenant or following the outcome of a dispute resolution process in cases where there is no agreement. The interest from the funds deposited pays for the administration of the scheme and there is no fee to either the landlord or tenant. In an insurance-based scheme, the landlord pays a premium to insure the risk of the deposit not being returned but retains the deposit. In the event of a dispute, the landlord lodges the total of the deposit with the scheme and it is repaid to either the landlord or the tenant at the conclusion of a dispute resolution process.
I considered all of the options presented in the report in order to determine how to offer the greatest protection to tenants at least cost to the Exchequer and secured Government approval for the establishment of a tenancy deposit scheme based on a custodial model. Legislative provisions for the scheme, which are currently being drafted by the Office of the Parliamentary Counsel, will be included in the Residential Tenancies (Amendment) (No. 2) Bill 2012 at Committee Stage in the Seanad.