Arthur Morgan
Question:106 Mr. Morgan asked the Minister for Social and Family Affairs if she will remove the €107 cap on rent supplement in view of the hardship it is causing. [17541/04]
View answerTuesday, 15 June 2004
Questions (58, 59)
Seán Ryan
Question:117 Mr. S. Ryan asked the Minister for Social and Family Affairs her views on the ESRI report, Housing, Poverty and Wealth in Ireland; her further views on whether increases in the rent supplement are the best way to support persons vulnerable to high rents set by landlords; and if she will make a statement on the matter. [17706/04]
View answerWritten answers
I propose to take Questions Nos. 106 and 117 together.
Following a review of the maximum rent limits carried out in my Department last year I increased the €107 limit to €115 with effect from 1 January 2004. I am satisfied that, rather than having an adverse impact, setting maximum levels has improved the position of people on low incomes in acquiring accommodation because it has a stabilising effect on the market. Setting maximum rent limits higher than are justified by the open market distorts the rental market and leads to a general rise in rent levels that disadvantages people on low incomes.
The ESRI study, to which the Deputy refers, was carried out for the Combat Poverty Agency. It is based on data from the 2000 Living in Ireland survey and earlier surveys and was completed in 2003. One of its key findings is that problems with the affordability of dwellings are most severe in the private rented sector and that they have the greatest impact from a poverty perspective in that sector. The study found that from 1987 to 1999-2000, the share of household expenditure absorbed by rent among private tenants increased 1.7 times from 12.5% to 21% while the share of household expenditure taken up by mortgage payments remained more or less stable at approximately 10%.
Under the terms of the supplementary welfare allowance scheme, which is administered on behalf of my Department by the health boards, payment of a weekly or monthly supplement may be made in respect of rent to eligible people in the State whose means are insufficient to meet their needs and who have no other accommodation available to them. The purpose of the supplementary welfare allowance scheme is to deal with emergencies and short term needs that arise when a person suffers a change in circumstances, for example, when a tenant becomes unemployed and can no longer afford to pay rent.
Rent supplements were never intended to meet a person's long-term housing needs as this is best met through housing by the local authorities. In recognition of the fact that the rent supplement scheme had, in effect, become a long-term housing support for many people the Government set up a working group to rationalise current arrangements for housing support. Our objective is to ensure long-term housing needs are addressed through providing appropriate solutions with the involvement of the housing authorities rather than through the social welfare system.
An interdepartmental planning group was established to draw up detailed proposals for the implementation of revised arrangements. Arising from the work of this group an action plan is being finalised and this will include criteria for determining which categories of rent supplement recipient will be eligible to have their needs addressed by the housing authorities, an implementation timescale and other matters. I expect to put proposals to Government on this matter shortly.
Question No. 107 answered with QuestionNo. 88.