Housing (Miscellaneous Provisions) Bill 2014: Report Stage (Resumed)

Debate resumed on amendment No. 35:
In page 62, between lines 30 and 31, to insert the following:
"52. (1) The Minister shall, six months after the coming into operation of this Part, cause a review to be conducted which shall assess the effectiveness of the measures contained in this Part under the following categories:
(a) the net effect on the numbers of families waiting for accommodation to be provided to them by a housing authority in each local authority area;
(b) the net number of individuals and families who are on the emergency accommodation waiting lists in their respective areas;
(c) the number of local authority staff required by each housing authority for the optimal administration of the measures under this Part;
(d) the funding required from the Central Fund or the local government fund for the optimal delivery of the measures under this Part.
(2) The Minister shall compile the data and analysis undertaken under subsection (1) into a report which shall be laid before both Houses of the Oireachtas and transmitted to the Joint Oireachtas Committee on the Environment, Culture and the Gaeltacht, or its successor Committee.".
- (Deputy Catherine Murphy).

Before the commencement of the debate on the Private Members' Bill, I stated that the rent allowance was supposed to be a short-term fix rather than a long-term solution. RAS was supposed to be a short-term fix. The implementation of HAP, as regards what landlords will get it, is very much based on RAS where one can work when paying with rent allowance. The landlord will get the money directly paid to him or her.

However, there is a real problem - that there is the same supply. What landlord will go into the HAP when they already have the RAS? Landlords are pulling out of the RAS anyway. It is impossible for tenants who are in RAS to get alternative RAS provision. That is the problem that we have to address. I do not understand why we are not doing so. Even though it formed part of the programme for Government, it did so when the parties in government did not realise the extent of the housing crisis. As Fr. Peter McVerry has said, it is a tsunami. If we had a tsunami tomorrow, we would have to find the money to build infrastructure again to rebuild the city. We are seeing the same in the homeless crisis. It is a tsunami. Where there is a tsunami, we have to find the funding to rebuild homes for those who have lost the roof over their heads.

The idea of holding a review in six months is important so that we see whether this HAP is having any impact, as I do not think it will. At the end of the day, the Government is still relying on the market where Mr. Wilbur Ross is pumping money in to supply investment for housing land. He would not be going into that market if he did not think he would get a big return on it. We must be wary about what has happened in the last period of time. Unless the Government addresses the question of housing being market driven rather than there being a strategy and it being provided as a need, we will be looking at more hapless situations, such as this, or further legislation.

I support the principle of the amendment which proposes a review of the implementation of various sets of proposals. Everything that has been said to date indicates that there is a need to be able to review the position to see that it is working effectively because of the consequences for individuals and families if the proposals in the Bill do not have the desired effect the Minister set out.

I refer in particular to paragraph (1)(c) of Deputy Catherine Murphy's amendment, which refers to "the number of local authority staff required by each housing authority for the optimal administration of the measures under this Part". I repeat the point I made on Second Stage and subsequently, that in my experience local authorities do not dedicate sufficient staff to housing departments in order for them to achieve the optimal outcome in terms of either construction programmes when there was funding being provided or the general effective administration of housing. I put it to the Minister that housing is not a priority for the Government and it has not been a priority for previous Governments.

Although I am particularly proud of my own party's achievements in government, I have to say that when we were in government we did not give sufficient priority to housing.

As managers and potential managers look at their career paths and how they might build on them, they will see how the number of miles of motorway built through their county may enhance those career paths. The number of community development organisations that are established may also enhance their career paths, as will the number of artistic programmes mounted in a particular county. However, building local authority houses or working on the housing agenda does not seem to positively affect county managers' career paths.

The Minister of State should call in county managers and tell them in clear terms that her Department requires a level of achievement and output, as envisaged in the amendment before us which refers to a six-monthly review. Without that level of enforcement, we will not see the sort of results we want. It is more than just a problem for local authorities, it is also a problem for us as politicians. I am convinced that one of the reasons housing is not a priority is because a large percentage of those on the housing list do not vote. Many of them are not included on the electoral register because they move from place to place regularly. They would have to make an effort above and beyond that made by other citizens to ensure they remain on the electoral register. That is one of the reasons they are not the political priority they should be.

We hear much more talk about homelessness than about those on the housing list. One reason for this is because many good, worthwhile and admirable agencies, such as the Fr. Peter McVerry Trust, the Society of St. Vincent de Paul and Threshold, have a particular focus on homelessness. It is their focus that causes the issue to be prioritised to some extent in the national media, whereas the problem of the mainstream of people who require and depend on local authorities to provide housing supports for them does not get the same level of priority.

The Minister of State has an empathy and understanding of the issue but there is nothing in this legislation to indicate that sort of feeling is being given effect to. The Minister of State should look positively on the amendment before us and give it the support it deserves.

The Minister of State would be well advised to accept the amendment. The idea of a review might be a handy way to get her off the hook because there is no question that the housing assistance payment or HAP scheme will not work. This might be a good way for it to be reviewed in six months and then quietly ditched.

I will not labour the points that others have made, but the private landlord class in this country is motivated by profit, not by housing social tenants. At the moment, private landlords have absolutely no interest in taking on HAP, RAS - the rental accommodation scheme - or any other acronymic scheme. That is because there is a lucrative queue of people elsewhere who are not on social welfare and who can outbid for rent.

I disagree with the previous speaker that homelessness is a priority. The priority is to hide it away, sweep it under a carpet and keep people out of sight.

The Minister of State should drop her proposal because HAP will accelerate the demise of the Labour Party. She may shrug her shoulders but it used to be a tenet of Labour Party thinking that social housing would be provided for working class people who could not afford to buy a house. The Minister of State is now throwing people off housing waiting lists and putting them onto a HAP scheme. It seems to be a crude way of eliminating potentially 70% to 80% of the housing list at the stroke of a pen.

It was argued at the committee meeting earlier that there was some sort of parity between people on HAP and those in a council home, but there is none. People want security of tenure to avoid having to move their children from school to school at the whim of a landlord a year later. It is wrong, therefore, to suggest that it is a decent home.

The Bill should be scrapped for another reason. It is appalling to include deduction at source from the social welfare of council tenants and HAP participants. It is high-handed, insulting and penalises the poor. Apart from council tenants and social welfare recipients, no other group has a bill deducted from their income. People are getting into rent arrears due to austerity, all the cuts that have taken place and the increase in fuel prices.

It is sad to see a Labour Minister bringing in such a measure. It is something Margaret Thatcher would have dreamed of.

There will be an ongoing review process over the next six months because it is the pilot phase. Once this legislation is passed, which I hope it will be before the summer recess, it will give us the legislative base on which to develop pilot schemes in the other seven local authorities. An ongoing review is built in during the course of the pilot phase which is a learning process. On Committee Stage, I gave a commitment to report to the committee at the end of the pilot phase. I will also be reporting back to Government, and generally, on the outcome of the pilot phase. I will be examining it to see if elements need to be changed, including legislative change if necessary. I can give Deputy Murphy an undertaking that at that point, if we need to put an ongoing review process into the relevant legislation, I will do so. The next six months will be a learning process. I have given a commitment both to the committee and the Government that we will come back to examine it fully and to ensure it is doing what is intended.

I will not rise to any provocation regarding my own party, but I will respond to housing issues in my role as the responsible Minister. We are not moving towards reliance on private landlords. We are actually reforming the system for people who are already, at least temporarily, reliant on private landlords because of the shortage of supply. I fully acknowledge that there is a shortage of supply. This is not moving a pile of people into a private landlord situation. It is addressing the existing situation, which is that people are living in houses owned by private landlords. They are in receipt of rent supplement with all the negativity attached in that if they are lucky enough to get a job, they will lose their rent support.

When we debated this on Second Stage, there was a positive welcome for that element. I hope some people will see some merit in this legislation. I think there is quite a lot of merit in all three elements of the Bill. It is not about moving towards privatising any system; it is about dealing with the current reality, largely because there is an under-supply.

I have already acknowledged that there needs to be more regulation of the private rented sector to give more security for tenants.

We want to improve the situation for people who are currently in private rented accommodation by bringing it under the local authorities and giving them better rights, particularly with regard to the amount of money they have to pay, and relating it to their income. That is the purpose.

I made homelessness a priority when I became Minister of State. One of my first statements was that homelessness would be a priority for me. I established the oversight group shortly afterwards. It reported and we are acting on its recommendations. This was not because the media highlighted the issue. There was practically no media coverage of the establishment of the oversight group and the earlier stages of its works. It was only in recent months that the media began to highlight this area. I am not acting because of the media coverage; I am acting because it is the right thing to do. We should not tolerate homelessness in a civilised society and a republic. That is something I am determined to address. I am straying off the issue but others strayed and I wanted to respond to their points.

We are not getting the straight reality of what this legislation means. I acknowledge it is positive that people will go on to a differential rent scheme. It is preferable to the sham fiasco and waste of money that is rent allowance. However, the Minister of State is arguing that being in a HAPS arrangement, where one is a tenant of a private landlord, albeit in a deferential rent scheme, is the same as being in a council house.

I did not say that. I said it is paid the same way.

This Bill states that one will be deemed to be appropriately housed.

I did not say that either.

Section 37 states that the provision of housing assistance under this Part shall be deemed to be an appropriate form of social housing support for a household.

Social housing support.

The Minister of State's departmental officials confirmed to the committee today that people in that situation will be off the housing list. She tried to cover over that by saying they can apply for a transfer but one can only apply to a local authority for a transfer if one is deemed to be in overcrowded accommodation or to have a medical priority. One cannot apply for a transfer because one wants to move from private rented accommodation to a council house. It is not even possible to apply for a transfer from one council house to another. That was done away with ten or 15 years ago. In reality, once a tenant is in a HAP scheme - he or she will not have any choice about it in the unlikely event that the council can come to an arrangement - his or her ten year wait on the list will be extinguished. The only basis on which he or she will be able to get a transfer is medical priority or overcrowded accommodation.

That is enormous and the consequences need to be monitored. I appeal to the Minister of State, even at this late stage, not to proceed with this provision. In the absence of rent control it is going to be an unmitigated disaster. The disaster has already been unfolding but it will accelerate over the coming weeks. It is not too late to stop this process but if she is not going to halt it at least she can commit to this review to allow us to monitor and assess the damage that will be done by this retrograde legislation.

I acknowledge there is a poverty trap in the rent assistance system which prevents people from going to work. Essentially, they are worse off where the entry level for employment is quite low. I can understand why it becomes an issue. There is no doubt, therefore, that this is a positive aspect of the legislation. However, the biggest negative is that people will be taken off housing waiting lists. I have encountered people who contacted the council because their landlords pulled out of RAS only to be told they had to source their own accommodation. That will be the experience with this Bill. The application of housing policy varies around the country depending on the local authority. The biggest fault line in this legislation is that a tenant is deemed to be adequately housed and will be forced to source his or her own accommodation if the lease concludes.

I have asked officials in my own local authority how they think this will play out. There is no transfer list in Kildare County Council. A tenant who is seeking a transfer is on the housing list. This will outsource housing to the private market and turn the housing authorities into housing support agencies. That is the biggest fault with this legislation.

It is reasonable to suggest a period of six months for monitoring the legislation subsequent to its introduction. I am not clear on how people will transfer from rental supplement to HAP. Many of the 78,000 people who are in receipt of rent supplement are making top up payments. What problems will we face when we come to assessing that in the local authorities? I can see major problems in this regard because some of the rents being paid are over and above what is allowed. Has this problem been encountered in the trial version of HAP in Limerick? Have people reported receiving rent supplement payments that they had to top up?

To deem people under HAP as having adequate housing is absolutely mad. It is similar to what happened in 2011, when a rule was introduced stating that anyone signing up to RAS was to be regarded as adequately housed. The same people are now being made homeless. They cannot even find a local authority place because they have been made homeless.

We are doing all of this in the absence of rent control. I do not understand how we are supposed to keep rents at a certain level, and monitor them, when two of my amendments on rent control were ruled out of order. Whether it is tied to inflation or the cost of living, we must develop a mechanism for rent control. It is done in other European countries. The Minister of State's officials and officials from the Department of Social Protection acknowledged that people will end up off the housing list but she has not once acknowledged that people will be taken from the housing list if they avail of HAP. She needs to have the honesty to acknowledge that is going to happen. People will then start to wake up to what is happening.

This is the first time I have spoken on this Bill but I have followed the debate as much as possible on this and Committee Stage, as I have much interest in the issue. My area has a high level of social housing and people dependent on rent supplement. Other Deputies have spoken about rent supplement and I also cannot see how this Bill will help the problem, given our current economic climate. The amendment would have the Government examine, after six months of operation, the effectiveness of this new process. It would not tie the Government to an onerous amount of work or contradict the Bill. It would seek to determine if the Bill has the effect that the Minister of State and her officials have spoken about. I do not believe it can do so and the proposed process is not in a format to have such an effect. It is another example of further entrenching the subsidisation of private landlords in this country. Rather than doing this we should try to ensure an increase in the supply of social housing and we should undo the lack of investment evident for quite a number of years with social housing in the country. Spending did not keep pace in the good times or even in bad times, and in the past 20 years we have not properly addressed the social housing issue in a way that dealt with increasing housing lists. That has definitely not been evident in the past three years.

I agree with my colleague about rent control, an issue that can and should be considered very quickly so as to address a major problem in this city and, as far as I know, other locations on the island where private landlords are creaming it. The proposed changes will not necessarily attract landlords into a system. This process is modelled on the rental accommodation scheme, RAS, and a pilot was implemented in Limerick. Examination of the RAS operation in this city demonstrates that it has been a basket case, with the council now encouraging people to stay in accommodation despite it being sold from under them by a landlord. Not only is the city council in breach of its agreement but it is encouraging the tenant to be compliant in such a position. Tenants are frightened that in the morning either bailiffs or other parties could put them out on the street, despite the fact there is a legal agreement between the tenant and the council. The council has not been able to find landlords to take up the RAS in the past few years in this city.

This new proposal for a housing assistance payment, HAP, will go the same road, creating more nightmares along the way. It is a disgrace that anybody in these schemes could be taken off a housing waiting list as these are temporary measures. The HAP is a temporary payment and it is not a solution to a person's housing problem.

I will try not to repeat myself. The HAP is at the centre of this legislation and although the coming into being of the payment is entirely positive, the idea that once a person gets the payment, he or she is taken off a housing waiting list is entirely negative. Does the Minister of State accept that her officials contacted Kildare County Council to indicate that everybody involved with leasing and RAS should be taken off the housing waiting list? Does she accept that her officials contacted Kildare County Council to indicate that when the HAP is introduced, nobody in receipt of the payment should be entitled to continue on a council waiting list? These are simple and straightforward questions.

I will be as simple and straightforward as I can be in response. HAP tenants will be given the opportunity to be on a list for a council house.

Department officials stated they would be taken off a housing list.

They will be able to be on a list to access a council house.

That is after they are taken off the housing list.

In order to ensure that happens, I will use my statutory powers from the 2009 Act to direct housing authorities to allow for HAP households to be on a transfer list.

It is a transfer list.

It was indicated that people would remain on the list.

I would like to continue.

That is playing with words. It is unacceptable.

It is a transfer list - I am being absolutely honest about that - but it will reflect the specific priority or previous position that the household had on the main waiting list within the authority area where it is resident. The household should be placed on a transfer list on no less favourable terms. I am not trying to alter people's rights.

How does one apply to transfer-----

If a person is in receipt of the HAP, he or she is under the local authority remit and receiving a social housing support as opposed to a social protection payment under the Department of Social Protection. A person receiving a social housing support comes within the housing system. I am determined to ensure these people will not lose their place or the number of years built on the list. They will be able to transfer into a local authority house when a suitable property becomes available. This does not mean it will happen overnight as many of these people have been sitting on waiting lists for years anyway. We have all spoken about the supply issue and I have acknowledged that as a problem.

I am not trying to disadvantage people in any way by doing this but it is logical that if they are to be under the local authority remit and getting a social housing support, for the time being they are in a social housing position-----

Every person will apply to be on the transfer list.

By all means let them do so but that may not be true. In some parts of the country people are on long-term rent supplement and if they were offered a council house in the morning they may have a serious problem because they may not want a council house.

I would love to know where they are.

In the area which Deputy Boyd Barrett represents, most people would tick the box. Some may be happy to stay in a private rented dwelling as they may like it. I am expressing the issue as clearly as possible. These people will be entitled to go on a list for a council house without losing-----

Is that immediately or two years down the road?

I can act with statutory powers of direction and I want the process to be as simple as possible for people.

Why not put that into the Bill?

Not everybody wants a council house. The amendment originally put down by Deputy Cowen would mean people would not have social housing support. That is how the discussion arose. It is not correct to say people would not have social housing support as they do.

That is not permanent.

Members are entitled to speak twice to amendments on Report Stage and Deputy Catherine Murphy has a right to reply. Deputies Joan Collins and Coppinger have yet to speak a second time to this amendment.

I want to check that I heard the Minister's comments correctly. Did she say somebody on the housing list - deemed to have a housing need and in receipt of rent allowance - who takes the HAP is allowed to go on another housing list?

It is a transfer list.

After two years.

I did not say that.

It is the rule.

The rules can be changed.

I will ask again the question posed by Deputy Ó Feargháil. Is the Minister of State contradicting the officials from the Department of Social Protection who were before the committee today? They indicated that anybody in receipt of the HAP would be taken off the housing list.

No. They will be taken off the housing list but they can go on a transfer list.

On what basis can these people apply?

The Deputy has already contributed.

If they want to transfer-----

From comments last week, I understood that people will not be taken off the housing list.

I said they could access local authority housing.

By saying that the Minister of State is playing with words. Are they on the housing list, with a need for housing?

Short-term HAP gives them short-term housing but they could remain on the housing list. If what the Minister of State says is true it is a scandal.

I have just emerged from 11 years as a councillor and am au fait with the transfer and housing situation. Before one can even think of applying for a transfer one has to be in a house for two years. The reasons for the transfer would have to be serious anti-social behaviour, violence, overcrowding or some major health issue. One does not have a snowball’s chance in hell of getting a transfer anywhere at the moment because the housing departments are inundated and their priority is to get people into houses rather than transfer people from one house to another.

The Minister of State was a bit unsure the last day we debated this Bill but has admitted today that people who go on to the HAP scheme will be knocked off the council housing list. Officials from the Department of the Environment, Community and Local Government confirmed this at the meeting of the Oireachtas Joint Committee on the Environment, Community and Local Government. Those people will be council tenants but without the rights of other council tenants who have secure tenure. The Minister of State is right to say they will apply for a transfer because that is all they will be entitled to when they are regarded as being adequately housed. The Minister of State is creating a second tier, yellow pack council tenant.

I take exception to the Minister of State’s remark, one that I have heard from council housing officials, that many people are happy where they are and do not want a council house. The people I deal with would give their right arm for a council house. If somebody does not want a council house he or she will be offered two or three houses and will then be knocked off the list. They will not be offered another and will not get rent supplement. I do not know where these people are. Maybe the housing officials actually believe that people want this form of housing. They do not. Many people who would not have seen themselves living in a council house some years ago would now be happy to do so.

I was brought up in a council house that was built in the 1970s. It was a way of life for people who could not afford to buy on the open market. I am genuinely dismayed to see the Minister of State breaking with a tradition like that, as a member of the Labour Party. She shrugged when I said we cannot blame the Labour Party for what the Government inherited, the bailout, the lack of house-building under Fianna Fáil, who admitted as much earlier this evening, but we can blame the Minister of State for this. Her name is on it. It breaches an obligation and responsibility to provide council housing.

I remind the previous speaker that the previous Government built up to 44,000 housing units in an eight or nine year period.

Let us return to a point where we on this side of the House can agree about what has been said consistently during this debate. It stems from the short-term measures included in this Bill, which we welcome. We acknowledge the need for them but they are short-term solutions for many people who need a long-term solution. The Minister of State has acknowledged that those accommodated by this scheme will come off the housing list. Where they go from there is the problem. The Minister of State says they will go on a transfer list. In all the counties we represent there are fiefdoms, which have different rules and regulations and management structures for the control of lists and how people are transferred. Some people cannot get a transfer unless they have been in a house for a year or two. Some local authorities do not operate a transfer system at all because of the costs associated with it. The Minister of State says she will apply a ministerial order to effect this. How in heaven’s name can she be in her office every second day writing ministerial orders for people who wish to apply for a transfer, when their local authority does not have a system that might accommodate that process in the first instance?

The Minister of State knows well that there is nothing in this Bill to acknowledge the fact that a long-term solution needs to remain available to those accommodated on a HAP scheme. We are all on the same wavelength in respect of this Bill and our amendment. The Minister of State has acknowledged that she wants to get those people on a list. The only way to do that is by accepting an amendment or at least by acknowledging, when she brings the Bill to the Seanad, the efforts many of us have made here today to ensure that long-term housing remains available to anybody on a HAP scheme.

We all know the difficulty the Minister of State has had heretofore in raising funds to address this problem as it was historically addressed, through the provision of housing units. Until local authorities can address the existing difficulties in a meaningful way we will not solve this problem. Meanwhile, there are short-term solutions, as there have been for the past three or four years. We acknowledge the Minister of State’s efforts in that regard. In the interests of conciliation and of serving our purpose here, to help those in need, the Minister of State must play her part in this process and accept some of these amendments in the good faith in which they are proposed.

I did not want to have to say what other speakers have said but the Minister of State seems to deny outright and try to disregard everything and anything put before her. I believe she does want to solve this problem and she is disappointed that many local authorities have taken the liberty of taking people off housing lists when short-term solutions are provided. Rather than make ministerial orders, the Minister of State and the officials in the Department should put their heads together and either accept some of these amendments or take cognisance of what we have said because we represent many constituents around the country. We are not making this up. We are all interested in providing solutions. The Minister of State has put forward short-term solutions in the hope of finding long-term solutions soon, through various means. In the meantime, however, she should not deny these people the right and opportunity to have a long-term solution, as everybody on the housing list does.

I will reiterate what I said in my first contribution on this issue. The HAP is a temporary measure. It is a temporary housing support mechanism. It is a Dublin City Council tenancy with a private landlord who owns the house. It is not social housing because it is not controlled by a local authority or a voluntary housing agency. We are here because there has not been sufficient investment in social housing. The response to the crisis which has been building up in the past five or so years has not been quick enough. There has been a failure to act, to control the market, to ensure adequate supply, or at least some supply that would address the problems. This Bill does not, in any shape or form, address the problems that emerged during the experiment with RAS in this city. In fact, the legislation compounds those problems.

I accept the Minister of State's assurance that she will deal in regulations with the whole question of allowing people to get onto the transfer list. Is she giving a commitment that every rental scheme, or every scheme of lettings in every local authority, will address the fact that regardless of whether one is in local authority housing or in the rental accommodation scheme, one must have already passed two years' tenancy before one is allowed to get onto the transfer list? That is the current situation in Dublin City Council. I think it is reflected elsewhere. If the Minister is guaranteeing that people who have been housed with a housing assistance payment will continue on the housing list in their current situation, her approach differs from what is contained in the Bill. In such circumstances, rather than promising that this will be done by means of regulation, it would have been better for her to ensure it is contained in the legislation itself.

I mentioned earlier that Kildare County Council does not operate a transfer list. A person who goes on the transfer list because he or she is unsatisfactorily housed essentially goes on the council waiting list. If they go on that list today, they get the number for today. If a person who has been taken off the list because he or she is deemed to be satisfactorily housed needs to be placed on that list again two years later, he or she will be placed at the bottom of it. Some of these people may well have been on the housing waiting list for seven, eight, nine or ten years. The fairness associated with the scheme of letting priorities is really going out the window under this approach, which means that people are constantly going to the bottom of the list. I suggest that a transfer list should be introduced. As I have said, not every local authority has a transfer list. Such a list has certainly not been maintained in County Kildare for many years. A variety of things will continue to happen throughout the country unless the Government sets a particular standard for them all to follow.

I will explain why this matters hugely to people. If the Minister of State asks someone who has been on the housing waiting list since 2005 or 2006 whether going off the list and getting a housing assistance payment would compensate them for losing the hope of ever having a home, she will be told that would make them feel like they are renting someone else's property without retaining the hope of ever having a home. There is a world of difference there. Not all of the consequences of the ongoing use of a system that moves children around frequently can be counted from a financial point of view. The consequences for children of having to move away from the support of schools and things like after-school activities that would be normal in most children's lives cannot be quantified in monetary terms. One of the reasons people in this country buy houses is that they really have no other option if they want security of tenure. We need to have a rental option - a third way - that provides security of tenure for people who can afford it. That is a whole other day's work. I do not think this has been thought out. It has certainly not been thought out from the point of view of the 90,000 people on the housing list, the 30,000 people on the rental accommodation scheme and the people who are going to enter the list when they have their houses repossessed. This particular aspect of the Bill is certainly not acting in their interests. I am not disputing it in so far as it relates to the poverty trap.

Amendment put and declared lost.

Amendments Nos. 36 and 37, in the name of Deputy Ellis, are out of order.

Amendments Nos. 36 and 37 not moved.

As amendments Nos. 38 to 43, inclusive, are related, they may be discussed together.

I move amendment No. 38:

In page 63, to delete lines 31 to 34 and substitute the following:

"(2) (a) A housing authority may, if a tenant has refused to pay rent for a specified period of no less than 3 months and has refused to engage with the relevant authority, make a request to the Minister for Social Protection to deduct from net scheme payments the amount of rent payable to the authority by the relevant recipient concerned and to transmit the amount deducted to the authority.".

These amendments seek to deal with the hardship that results when rent deductions are made from social welfare payments. They set out what should happen if tenants refuse to engage and call on the Department of Social Protection to give tenants ten days notice before any deduction is made. I am also proposing that a report should be compiled within six months of any deduction. I am very uncomfortable with the idea of moneys that are owed being mandatorily deducted from social protection payments. I recognise that tenants must pay their rent. Evictions on the grounds of rent arrears or non-payment of rent should be avoided at all costs. This method of retrieving owed rent moneys should not be availed of other than in the most extreme cases. I refer, for example, to a case in which someone has owed rent and has refused to engage with the council over a sustained period. This method should not be used to end the practice of councils working with tenants who have fallen behind to reschedule payments through mediation. These issues should be dealt with by means of this very positive process in the first instance.

Many tenants have fallen behind on rent at one time or another. Due to the very small supply of social housing, it is the preserve for the most part of the most disadvantaged communities in our society. It can be very difficult for many tenants, especially older tenants, to manage their money. This has increasingly been the case during the recent years of austerity. Many families have had to choose between paying the rent and keeping the light on or food on the table. Countless heads have been kept above water in bad times because such decisions have been facilitated by councils that have shown flexibility. Amendment No. 39 provides that: "No single deduction ... may be made if it would reasonably cause undue hardship or suffering to the tenant concerned or their dependents."

Many other deductions are being made by the Department of Social Protection at present. Deductions are being made for the purposes of the household charge and they will be made when water charges come along. Now they are to be made for rent arrears. It goes against all my principles to make this mandatory. People need flexibility when bills come in. They do not know when they are going to come in. They have to make a little sacrifice every now and again, before catching up later. That is the way many people work, whether we like it or not. They have no choice other than to act in this manner.

The concept of giving someone the power to make a deduction from a social welfare payment is alien to me. However, it has increasingly been a part of the way this Government has operated. It crept under the radar when it was first brought in and used in the cases of the household charge and the other charges that were introduced. It is very offensive to people to have their control of their own moneys taken from them. The Department is taking more and more control of their moneys. I think it is a really bad way of doing business. This was brought in by the Labour Party, along with its colleagues. I think they got away with murder when they did this in the first place. That is why I am proposing these amendments.

Amendment No. 41 in this grouping is in the name of Deputy Catherine Murphy.

I know the Department of Social Protection has the ability to make a deduction from a social welfare payment if there has been an overpayment at some point in the past. In some cases, the Department goes back very long distances. This section of the Bill allows for a 15% deduction. Can this be applied in addition to another deduction? If there has also been a social welfare overpayment, for example, is it possible that two deductions would be made in such a scenario? Is there a bottom line in terms of the amount of money that people are likely to be left with in terms of a social welfare payment?

I referred on Committee Stage to the constituent who approached me regarding his property tax bill and the cheapest method of paying it. If he paid it in the post office, he discovered, it would cost him €1 per month on top of the tax itself. Having concluded that the best approach was to ask for the tax to be deducted from his social protection payment, he was told that this could not be done because it would leave him with less than the supplementary welfare rate to live on. There is something of a paradox here in the context of what is set out in the provisions we are discussing.

We are all agreed that people should pay their rent. Moreover, there certainly are people who have a poor record in this regard and must constantly be chased. There are others, however, who inadvertently find themselves in rent arrears. I made the point on Committee Stage that there must be a change in the situation whereby people lose their job in January but their rent payment is calculated on the basis of what they earned in the previous year. Such a person is very likely to run up a debt. While people in that situation might well be in arrears on paper, when it comes to doing a reconciliation the following year and taking into account the reduction in income for the time they are out of work, they may not, in fact, end up with the stated arrears. Nevertheless, it is very difficult to manage money in that situation and for people to estimate what the arrears might be. Instead of an annual review, a quarterly or half-yearly review might be more appropriate. A clarification is required in terms of how rent payments are calculated.

I am very concerned about these provisions. I have argued with the Minister for Social Protection in the past regarding the provision in legislation to deduct up to 15% of a person's social welfare payment in the case of overpayments. Now we have a Minister of State in another Department, who also is a member of the Labour Party, seeking to allow for deductions from social welfare moneys in a way which denies people control. The vast majority of adults are able to manage the few pennies they get from social welfare, but these provisions take any degree of control over their payments from them. There is often a situation where a person faces an exceptional payment such as a particularly high ESB bill, as many people faced following the particularly cold winter the year before last. In those circumstances, some people will put off paying their rent until the following week or month. It is not a practice one would like to see happening all the time but, in the main, people are clever enough to manage their own affairs and willing to endure a degree of suffering on the second or third month to ensure their rent is up to date.

The vast majority of local authority tenants have good rent payment records. On the other hand, there are those who make a hames of it and cannot manage their money. Help is available in that situation, and successive Governments have encouraged people to go to the Money Advice & Budgeting Service, MABS. It is a good thing to assist people in managing their finances and put in the types of orders the Minister of State is providing for here to help them. What is not acceptable, however, is to not write into legislation a provision for a compulsory deduction from social welfare payments. That is very much in the realm of Big Brother and it leads one to ask where it will stop. For example, would the value of food or butter vouchers, if they are ever reintroduced, be deducted at source? Will the Government continue deducting until those on social welfare are left without a penny?

It is important to note that not all persons dependent on social welfare are in receipt of €188 or more per week - anybody under the age of 22 receives only €100. If anybody on this lower rate is in the HAP scheme, will the €30, €40 or €50 rent payment be deducted from their social welfare? What will they be left with to feed themselves and pay the electricity bill? These provisions have not been properly thought out. There must be some degree of control left to those who are reluctantly dependent on social welfare. It is a sad indictment of this State that we have so many in that situation, unwillingly dependent on social protection payments and the provision of social housing. It shows what a basket case the country has become.

The Deputy can blame Fianna Fáil for that.

I did not suggest these problems were caused solely by the current Government.

This provision is a step too far and the Minister of State should take the opportunity to withdraw it. I speak regularly to officials in Dublin City Council's rents section and they have been very accommodating of people who get into rent difficulties. Arrangements are made to assist them and when people break those agreements, the council will help them again. It is very rare that people are evicted for non-payment of rent because local authority officials understand the circumstances which render people dependent on this type of assistance. They are the same people who seem set to end up dependent on the HAP scheme because of the failure of the State to provide adequate social housing. Under the new scheme, however, they will not have Dublin City Council to fall back on because the money will be taken at source and they will end up in arrears somewhere else. We have already seen the magnitude of arrears to electricity and gas suppliers. How many people have been cut off in the past two to three years? These numbers are a reflection of the type of crisis and chaos in which people are finding themselves. Many of these are the same people from whom rent payments will be deducted on a weekly basis under these provisions.

I welcome the reversal by the Government of its proposal to impose a guillotine on this debate.

Will the Minister of State and the Government seriously consider the fact that quite a number of Deputies have raised very serious questions and concerns about this Bill which should give the Government pause for thought? If the Minister of State, as she indicated, wants to reach a solution over which we can all stand and which deals with this crisis, the Government would be well advised to put back the reconvening of Report Stage for a quite a while and convene some sort of forum, which is not time limited or strictly controlled, where we can sit down and try to come up with something that would work, including discussions about how we could finance long-term social housing provision but also the short-term issues, because we might actually get somewhere. There have been some useful exchanges in this debate and some understandings and illuminations to which all of us have contributed. If we could take that forward instead of being dragooned into accepting this legislation in a few days' time or whatever, we might actually get somewhere. That is just an appeal to the Minister of State.

I would like to make three points on the issue of direct deductions. It is effectively punishing people who are victims of the recession and the economic crisis which have impacted on families in manifold ways - in a whole diverse range of ways into which I cannot even begin to go now where people may fall into arrears. Of course, there are cases of people who are just negligent, who are abusing the system or whatever, but they are a minority. There is, however, a very significant problem of rent arrears which has escalated in recent years and one can absolutely see the correlation between that escalation of the rent arrears crisis and the impact of recession, austerity and cuts in other areas on families and their capacity to pay rents. Therefore, the fact people get into arrears is often because of circumstances completely outside their control. I will give a few examples.

One very common example is that many council tenants actually pay their rent ahead. They pay more than their rent as a safeguard against anything ever going wrong. This is very common among council tenants. They pay their rent plus a bit just in case anything ever goes wrong, where they have exceptional needs, a death in the family, an illness or some difficulty which will mean they may not be able to meet their normal rent commitments. Those sort of emergencies and crises hit almost every family at some point in their lives, if not a couple of times. Suddenly, they can find themselves, for a period of six, eight or ten months, not able to meet their normal rent commitments which they have done religiously for all of the period of time they have been council tenants. However, they will be punished under this measure because of circumstances outside their control. That happens often.

I will give another common example before I get to specific examples, where somebody faithfully pays his or her rent and declares all income, earnings and all relevant circumstances to the housing department, in terms of the assessment of his or her rent, but the council makes a mistake. This happens all the time. The council assesses the person's rent as being at such a level but a year or even two years down the line, it says, "Sorry, we made a mistake" and although the tenant answered all the questions faithfully, when it looked at their assessment, it saw it should have been charging a higher rent. Over night, through no fault of the tenant, he or she is suddenly told that although they thought they were in the black, they are actually in the red to the tune of €4,000 or €5,000. This happens all the time. I deal with rent sections which say they are sorry they made a mistake but the person has to pay for the mistake and that they will take it directly out of the person's money even though it is through no fault of the person's.

I will give another example of a family where somebody in the house has a problem - say one of the principal earners has a problem with drink or something like that but his wife and children believe he is paying the rent and are giving him money to pay it but he is not doing so and they do not know about it. He is culpable and the council has a legitimate case against him. In one particular instance, a couple subsequently separated but the whole family was evicted for rent arrears. Some €12,000 of rent arrears had built up through no fault whatsoever of the children or the wife but they were all evicted. In this case, the money would have been directly deducted from their income even though it had nothing to do with them. That is not fair and this is the problem with what the Minister of State proposes. There will be innocent victims of all sorts of situations which are not the fault of those tenants. Of course, we should help and assist people who may have difficulty paying their rent but the best way to do that is to make sure people are not pushed into poverty.

I will give another example, of which I should have thought and which is coming up all the time now. The different quality of council housing means that many tenants, in particular those in older council houses, have to pay much more on heating than tenants in new council houses because there is chronic damp and the houses were built a long time ago and are substandard. A tenant, through no fault of his or her own, has to buy an electric heater because the place is damp. It is really the council's responsibility, and often the council will say it is its responsibility but it does not have the money to dry line the house or to put in insulation, so people have to fork out a much higher proportion of their meagre income on heating the place than somebody who happens to be in a new council house. As a result of the need to keep warm during the winter, people find themselves in arrears and unable to meet all of their rent commitments. They will be hit on the double because the council will say it is now going to grab the money from them, making a bad situation worse. That is not uncommon. There is a lot of housing stock in Dún Laoghaire-Rathdown, and I am sure elsewhere, where there are chronic problems of damp, lack of insulation, cold and so on and where people are forced to spend massive amounts of their meagre incomes on just keeping the place warm, in particular during winter, and let us not forget the fuel allowance has been cut, making that situation worse.

Under this measure, these people will be punished and told that the council will grab a portion of their social welfare payment, pension or whatever. It is absolutely not fair. We must have measures to deal with people who are abusing this but if people are having difficulties, we need compassion, flexibility and housing departments which have the flexibility to actually recognise where some people have got into difficulty through no fault of their own and should not be punished as a result. On those grounds, I ask the Minister of State to seriously reconsider this measure.

This section of the Bill is totally Dickensian. The implication is that if one is poor, some kind of a stick is needed to get one to pay up. As we know, the same does not apply to the wealthy. I noted at the Oireachtas Joint Committee on the Environment, Community and Local Government today that it appears a mandatory direct deduction facility is being introduced for HAP as well and not just for rent arrears.

I oppose the measure and do not agree with trying to amend this in any way. It is an absolute cheek to dip into people's social welfare payments to pay rent. This seems to be the Government's latest response if people cannot pay. It has introduced deduction at source for the property tax, but it seems only for the poorest in society.

Others have said why people get into arrears. People are in arrears because they are suffering from six years of austerity. These people are at the absolute margins of society. The largest single group in poverty in this country is lone parents. Most of the people on the councils' waiting lists and in council housing are lone parents.

A sure-fire way of landing in poverty is to rear a child on one's own. That is why people struggle with rent. Fuel has been mentioned also. Disputes should be also part of the equation. A lot of council tenants in our council area had pyrite problems in their homes. Does the Minister of State consider it right that they had to pay their council rent all through the years of waiting for the problem to be fixed? I do not. A person in private rented accommodation would not have to do so. The people concerned did pay the rent but they would have been justified in withholding it.

The key point is that we should not under any circumstances allow such an infringement of people’s civil liberties, namely, that their incomes could be deducted to pay a bill. It is redolent of Big Brother that the local authority and the Department of Social Protection can connive and conspire in that way. I contrast the approach to the treatment given to Denis O’Brien that was publicised last week. He was struggling with his debts and the bank wrote them off to the tune of €300 million. While council tenants will have their deductions taken away from them, the rich at the very top of society escape scot free, as they normally do. The proposal is an outrageous infringement of civil liberties. I am surprised that it is legal for a person to have his or her income cut to pay a bill. I do not know if the system could be challenged on that basis. It is completely wrong because it is punishing the poor for being poor.

Notwithstanding the validity of several of the points that have been made by previous speakers, I think it is the case – the Minister of State can correct me if I am wrong – that some employers, for example, can agree with local authorities to facilitate deductions at source where tenants, for whatever reason, feel it would be useful to them. In terms of social welfare recipients, I do not believe they should be singled out but two basic principles should be at play. First, where tenants consider it would be advantageous and would assist them in their overall financial management and where they are willing to agree to a deduction at source, that should be facilitated. I would welcome the inclusion of a such a provision in the legislation because it would help many people who have difficulty in managing their finances. When we look at the work of MABS, for example, we realise that there are many people who find it extremely difficult to manage the very scarce financial resources available to them. Whether that is the result of austerity or circumstances that prevailed prior to the advent of austerity is perhaps a moot point.

On the proposed amendment which addresses deductions of 15% or 5%, I believe the 5% proposal is reasonable in all circumstances and I urge the Minister of State to take that on board. As we discussed previously, people who are in arrears with their payments, when under pressure, are inclined to agree to practically anything. The deduction of 15% would be excessive and would be likely to give rise to real and sustainable hardship in most families who are in receipt of social welfare payments. The Minister of State has not accepted any amendments to date. I hope she will make a name for herself with this legislation and be brave enough to accept the amendment.

The introduction of systems that will ensure rental contributions due from tenants on social welfare are paid directly to the housing authority is central to the implementation of the housing assistance payment, HAP. At the end of 2011 the extent of the accumulated rent arrears across all housing authorities was €53.25 million. By the end of 2012 the figure had risen to €56.4 million. Deputy Ó Snodaigh in particular referred to the fact that the majority of tenants do pay their rent. It is a differential scheme so it is based on income. It is not fair to those people who pay their rent that others on the same income with the same family circumstances are not be obliged to pay their rent. Some arrears have been written off as bad debts but the problem is very serious and must be addressed.

The effect of the proposed provisions is to meet a person's housing need on a continuous basis by providing a mandatory rental deduction facility whereby a person does not fall into arrears, which would have the effect of reducing financial liability for local authorities for rent arrears. Where a mandatory direct deduction facility is not available, this would also have serious consequences in allowing arrears to develop in the context of creating a poverty trap for the households concerned. In one of Deputy Boyd Barrett’s examples he said the man of the house was not paying the rent but the rest of the people in the house thought he was and therefore they fell into arrears. That would not happen in the case of direct deduction because the money would be deducted at source and the rent would be paid.

In reply to Deputy Coppinger who has just left the Chamber, it is important to note that the Office of the Attorney General has agreed with the principle of a mandatory deduction of rents. We did get legal advice. The requirement for accommodation is a basic human need. The office has further advised of no legal impediment to deducting a rental payment at source for the provision of social housing support and in making the tenant or HAP recipient pay the full rent amount on the basis that it is the tenant who enters a binding contract on the provision of support and therefore has a legal obligation with respect to the payment of rent. The same advice also stated that there is no legal requirement to have a limit in place as to the amount to be deducted. There is a clear basis in law that housing is addressing a basic human need and it is perfectly legal to deduct at source.

In terms of arrears we also have been advised that there is no legal impediment to the deduction of rent arrears. In response to Deputy Catherine Murphy’s question, the 15% includes the social welfare overpayment so it will not be 15% plus, it will be a maximum of 15%. The scheme is designed to be realistic rather than punitive in terms of representing what a householder can reasonably be expected to pay.

In respect of amendments Nos. 39 and 42, in so far as they provide for the Minister for Social Protection to notify the tenant of the authority's request for a deduction in respect of rent or rent arrears, the Minister for Social Protection will facilitate the request for the deduction of rent and-or rent arrears from a social welfare payment on receipt of the instruction from the housing authority. As the information will already have been provided to the customer by the housing authority, it would not be necessary or administratively efficient for a further notification to issue from the Department of Social Protection.

In respect of amendment No. 41, as previously advised on Committee Stage, the ceiling in the Bill of 15% of the weekly personal rate of a social welfare recipient for deductions in respect of social welfare overpayments and rent arrears is the same as the ceiling for recovery of social welfare overpayments only in the Social Welfare Consolidation Act 2005. As I indicated, the 15% is the overall amount that can be taken. The 15% ceiling was set in consultation with the Attorney General's office as a realistic rather than a punitive limit on the deductions concerned and is considered to be the appropriate limit on deductions that would avoid the social welfare recipient falling into destitution. That is the basis for deductions at source. I have probably addressed the various issues - the debate ranged more widely – in terms of what the amendments contain.

The Minister of State mentioned the Attorney General who gave bad advice previously on upward-only rent reviews. It is the same Attorney General. I disagree with the principle of mandatorily taking money by the Department of Social Protection from those on social welfare payments. We should not do that. The same approach has been used in other areas. People are struggling at the moment. I do not know if the Government is aware of the high number of people who are struggling currently. Many of them have built up rent arrears. I am not proposing that they should not pay it back or that people should not pay a fair rent. Every possible means should be used to get people to pay rent but I do not agree with taking it from their social welfare payments. In some cases people are receiving only €100 a week because they are under a certain age. The proposal is scandalous.

If payments were constantly reduced by the Department, even for old age pensioners who have their own house, we would certainly hear a lot more from them and their representatives.

Debate adjourned.
The Dáil adjourned at 10.30 p.m. until 9.30 a.m. on Wednesday, 18 June 2014.