Dáil Éireann Debate, Thursday - 8 September 2022
676. Deputy Cian O'Callaghan asked the Minister for Housing, Local Government and Heritage the policy rationale for the percentage of household income that can be payable in rent as provided for in the Housing Circular 29/2022; the way that this compares to the differential rent scheme for local authority tenants; and if he will make a statement on the matter. [44248/22]
Amharc ar fhreagra677. Deputy Cian O'Callaghan asked the Minister for Housing, Local Government and Heritage the policy and legal basis for assessing HAP tenants and local authority tenants differently in terms of their capacity to pay rent as a percentage of their household income; and if he will make a statement on the matter. [44249/22]
Amharc ar fhreagraI propose to take Questions Nos. 676 and 677 together.
The Housing Assistance Payment (HAP) is a form of social housing support for people who have a long-term housing need. In order for a household to qualify for HAP, they must first be assessed as eligible for social housing support by their local authority. Any household assessed as eligible for social housing is immediately eligible for HAP and those households must source their own accommodation in the private rental sector. The accommodation sourced by tenants should be within the prescribed maximum HAP rent limits, which are based on household size and the rental market within the area concerned.
My Department is aware that some HAP recipients are making payments directly to their landlords, beyond the amount of HAP being paid on their behalf. While there is no legislative provision precluding HAP supported households contributing towards the monthly rent required by the landlord, local authorities have a responsibility to ensure that tenancies are sustainable and that households in HAP are in a position to meet the rental costs involved.
The Programme for Government commits to ensuring that HAP levels are adequate to support vulnerable households, while the supply of social housing increases.
Under Housing for All, the Department was tasked with undertaking an analytical exercise to examine whether an increase in the level of discretion available to Local Authorities under HAP is required. The Housing Agency undertook to carry out this analytical exercise on behalf of the Department to better understand what level of discretion should be made available to Local Authorities under HAP to maintain adequate levels of support.
Following receipt and analysis of this review, I, in cooperation with Government colleagues and the Department of Public Expenditure and Reform, have now approved an increase in the HAP discretion rate from 20% to 35% and for new tenancies to extend the couple’s rate to single person households. This will secure more tenancies and prevent new entries to homelessness. Both these measures came into effect from 11 July 2022.
All households in receipt of HAP as well as local authority tenants pay a differential rent based on the rent scheme set by the relevant local authority. The right of local authorities to set and collect rents on their dwellings is set out in section 58 of the Housing Act 1966. The making or amending of such schemes is an executive function and is subject to broad principles laid down by my Department including that; the rent payable should be related to income and a smaller proportion of income should be required from low income households; and that provision should be included for the acceptance of a lower rent than that required under the terms of the scheme in exceptional cases where payment of the normal rent would give rise to hardship.
Local discretion and flexibility are inherent in the devolved function of administering rent schemes. Decisions regarding the increase or decrease in the rent charged to tenants of local authorities are matters for individual local authorities in accordance with its differential rent scheme.
Housing affordability is measured by examining the proportion of household income that is spent on meeting their housing need whether renting or purchasing a home. As a general guide, for households on a moderate income, housing would be considered affordable where housing cost is below 35% of the household income. The Housing Agency website has an affordability calculator for use by local authorities. www.housingagency.ie/housing-information/affordability-calculator Most local authorities have adopted a 30% figure for how much a person’s income goes towards rental payments, which has some flexibility if the person is in employment.
I am committed to decreasing our reliance on the HAP scheme and we will only do that through significantly scaling up our social housing supply. ‘Housing for all’ sets us on a pathway to delivering 90,000 social homes between now and the end of 2030 including 9,000 this year.
