€30m rent deposits not returned
More than €30 million has been paid out by the Department of Social Protection in rent deposits for social welfare recipients since 2006.
Although deposits are refundable at the end of a tenancy, none of the money has been returned to the department. It is not known if the money is being withheld by landlords or kept by the tenant after it has been handed back.
Welfare officers have discretion to make “exceptional needs” payments to help fund costs welfare recipients cannot meet from their own resources.
Under the department’s rules, any payments should be confined to circumstances the welfare officer deems “unexpected, unforeseen or exceptional”.
In the case of tenants moving into new rental accommodation, deposits generally ranging from €450 to €1,000, but sometimes above this figure, have been paid by the officers.
The deposits are usually equal to one month’s rent. As with deposits in the private rented sector, they are repayable at the end of the tenancy if the requirements of the lease have been complied with and there are no outstanding debts owed to the landlord.
However, of the €32.3 million paid to landlords in deposits in the last six years, the department said it has no record of any money being returned.
Labour TD Kevin Humphreys said it was not acceptable that this money should be “written off” by the department. “I am shocked that over €30 million has been spent on rental deposits since 2006 and that none of that money has been recovered.”
The establishment of a deposit protection scheme, a commitment in the programme for government, would allow these deposits to be returned to the State if there were no problems with the tenancies, and this could save millions of euro, Mr Humphreys said.
“I believe that a rental deposit protection scheme run through the Private Residential Tenancies Board (PRTB) would allow these deposits to be recovered when a tenancy comes to an end, when a person moves into full private rental accommodation or other social housing schemes,” he said.
The largest amount was paid out in 2008, when more than €7.2 million was given to tenants to fund their deposits. This was up 60 per cent on the previous year, when €4.5 million was paid out, and was significantly more than the €4.8 million spent in 2006.
The amount paid out in 2009 remained high at €6.5 million but in 2010 the figure dropped to €4.5 million and last year €3.7 million was paid out. Up to April this year, for when the most recent figures are available, deposit payments of €860,000 had been made.
This money would have been better spent on social housing investment, Mr Humphreys said.
The department said there was no automatic entitlement on the part of a social welfare recipient to payment of a deposit and that “every effort” was made to ensure tenants were not given multiple payments if they move repeatedly.
Minister for Housing Jan O’Sullivan has said the PRTB had commissioned research into deposit protection schemes and was due to report this autumn. She would consider this research in the context of a Residential Tenancies Bill, she said.