I ask members to turn off all mobile phones. This meeting has been convened for the purpose of the consideration of the Housing (Amendment) Bill 2013. Cuirim fáilte roimh an Aire Stáit, Deputy Jan O'Sullivan, Mr. John O'Neill, principal officer, and Mr. Gabriel O'Duffy, assistant principal.
The Bill is very simple. I will ask the Minister of State to say a few words and will then call Deputy Catherine Murphy.
I welcome the opportunity to be here for Committee Stage of the Housing (Amendment) Bill 2013 and thank members for their support for it during the Second Stage debate in the Dáil.
The Bill makes technical changes to section 31 of the Housing (Miscellaneous Provisions) Act 2009 so that a new and more harmonised system of local authority rents can be implemented effectively. This technical Bill is required because section 31(5)(a) of the 2009 Act contains text that precludes the section from being implemented in a manner that ensures a clear statutory basis for housing authorities to charge rent during the transition to the new rents system. I do not believe I need to elaborate any further on the purpose of the Bill as we had a full debate on it on Second Stage.
As stated during the Second Stage debate, I support the Bill in principle. I have been contacted by a number of people about the new rent strategy and how matters may play out for them in that regard. For example, will a single person over-accommodated in a three-bedroom house or two bedroom flat which has been his or her home for a long time be permitted to remain in his or her home? I hope it is not the intention to introduce an over-accommodation charge, such as was introduced in Britain under the differential rent plus scheme. If the Minister can satisfy me that is not the intention, I am happy enough with the Bill.
On the transfer of the rent supplement, is that process still on target and what, if any, will be the implications in this regard?
I can assure Deputy Murphy that this Bill has nothing to do with moving people out of larger homes. It is purely a technical mechanism to allow local authorities to establish new rent schemes.
On the point made by Deputy Ellis, the Bill will facilitate the transition to HAP. We are progressing the outstanding issues with the Department of Social Protection. For example, it is proposed to introduce a deduction at source system. There are a number of issues in this regard that need to be addressed, including the economic and IT systems and so on. We are on track to bring a memorandum to Government in July and to introduce the HAP legislation in the autumn, which will flesh out how the scheme will work. We intend to introduce a small number of pilots under HAP in respect of the transition of rent supplement later this year. The full roll-out of HAP and transfer of rent supplement will be brought in gradually over the course of next year.
Rent supplement has been reduced a number of times in recent months. Will the introduction of this mechanism stabilise that situation, thus alleviating the problem in terms of the number of people being forced into homelessness? Will the result of this be no further cuts to rent supplement? The situation in this regard is chaotic, with many people having to leave their homes because landlords are insisting they pay €950 per month rather than €850 per month and so on. This is happening across the board. It is hoped the new system will stabilise this.
The intention is to have a model rent for particular houses. For example, a one-person household would pay a particular amount by way of contribution. A model rent will be set for each category of household in respect of those transferring from rent supplement. I believe this addresses the issue about which the Deputy is concerned, namely, people who cannot access housing because of the cap or cannot afford the amounts they are being asked to pay. Essentially, it is a measure that will address the poverty trap in which people find themselves and the difficulty in some cases of their finding appropriate accommodation within the limits allowed.
I have one other question which may not be relevant to this Bill. However, housing is a dominant issue for all of us. If there is one issue about which people consistently approach members, it is housing.
Have the locations for the pilot schemes been selected yet? I presume they will be in areas in respect of which there are lengthy waiting lists for houses. Also, will additional money be made available to support this measure? One of the reasons for the reduction in rent supplement is the cost in that regard to the Department of Social Protection. I presume the rent supplement budget of that Department will transfer to the Department of the Environment, Community and Local Government. If sufficient resources are not currently available to meet the cost of rent supplement, transferring responsibility for it from one Department to another will not change people's experience on the ground, which in some locations is that the rent supplement caps are way below those in the market which means the most vulnerable, people out of work and so on, find it difficult to secure accommodation.
In terms of the transfer, will budgetary issues arise?
We are currently working on a business plan. We will have to have adequate funding for this. The amount to be paid by the tenant will be decided on the basis of the model rent for HAP for each of the household categories. The money will have to be made available. The amounts payable will be similar to those payable under RAS. All of these issues have yet to be addressed. There will be a transfer of funding from the Department of Social Protection.
If there is insufficient money in terms of the business plan, will people have to pay significantly more than they are currently paying? I know that many people in my area are topping up rent payments. In terms of the business plan, is consideration being given to increasing the amount which the tenant will pay or is it proposed that under the new scheme they will pay similar amounts to those currently paid by RAS tenants?
We are examining model rents and are taking into account the amount currently paid by council tenants because they will also come within the remit of HAP. We are seeking to ensure a fair affordable rate is set for each category of family. All of the work is not yet complete. As such, I cannot give the Deputy a definitive answer in terms of what each family will be expected to pay. We will make that information available as soon as the next Bill, which will deal with the transition to HAP, is published, which probably will be in the autumn.
The majority of people I know currently living in the private rented sector in the County Laois area are paying more than that allowed under the rent supplement scheme. In other words, if the cap is €100 people typically are paying €110 to €130.
The most vulnerable people are also paying the minimum contribution of €30 for a single person or €45. This is how it is being gotten around. I know from filling out housing forms for people that one cannot set out what one is paying. The councils are aware of this. I use this information with council officials as a lever to get people housed because their contribution may be €80 or €100 out of a very small income.
There is a wide variation in the rents charged by local authorities under the differential rents scheme. I found a significant variation between a town council and a county council located 60 miles apart. The differential rent scheme is currently set out by the Minister. Under the new regime, will an element of discretion be left to councils? I am aware that councillors will have an input into setting rents under the Bill.
I am aware of a family of two parents and ten children who are staying in Bewley's Hotel in Newlands Cross because they are homeless. They left their dwelling in Cavan because they could not handle the situation and went to the Dublin City Council area. However, they are counted as making themselves homeless and are not even on the homeless list. It is a major problem because the only option open to them is the rent supplement scheme. They received a note from the council stating they can avail of it. They went to a place in Santry which, as a three bedroom house, was not ideal for accommodating 12 people. The landlord wanted to charge a rent that was a little higher than normal but the council did not agree because it was a three bedroom house. The family is costing the local authority a considerable amount of money because they are occupying hotel rooms. We have to address a range of issues in respect of the rent supplement and its effects. This is one of the reasons I referred to it.
Deputy Catherine Murphy made a number of good points which reflect the problems I am encountering. It is one matter to examine the tenant's contribution but if the Government keeps cutting it, these issues will continue to arise.
At present the rent supplement is not in my remit but the Department of Social Protection is carrying out a review which I understand is due to be completed relatively soon. Perhaps the Deputies should direct their questions at the Minister for Social Protection.
We are aware of the variations in differential rent around the country. We plan to give local authorities a period of time to harmonise rents and a certain amount of local discretion will be permitted. However, we will harmonise them as much as we can so that, for example, people living in neighbouring counties do not pay substantially different rent. We will give those authorities which have the most significant differences a few years to come closer to the harmonised levels so that people's rents do not increase or decrease too significantly.
