Government urged to reduce rent payments to landlords
THE GOVERNMENT has been urged to pay out less money in rent supplement to landlords following new figures which indicate that average rents fell significantly over the past year.
Rent supplement, a short-term income support aimed at people in private accommodation who cannot afford their rent, cost the taxpayer about €450 million last year.
A survey by Daft.ie indicates that rents nationally fell by about 12 per cent last year. However, Fine Gael says the average cost of individual rent supplements fell by just €2.50 over the same period.
Olwyn Enright, Fine Gael’s social and family affairs spokeswoman, yesterday called on the Government to review the rent supplement scheme in light of falling rent levels.
She estimated that taxpayers could save up to €55 million this year if rent supplement payments were reduced in line with the market rate.
“Rent supplement payments fell by just €2.50 last year even though the cost of renting property fell by an average of 12 per cent, which means the State is paying out significantly more than the market rate,” she said.
“In some parts of the country, landlords are able to take advantage of the rent supplement scheme by charging rent at the maximum amount payable by the State. This means that rent reductions of 13 per cent in Dublin, 10 per cent in Cork, 9 per cent in Limerick and 6 per cent in Galway, are not being reflected in individual rent supplement payments, which fell by just 2 per cent nationally.”
Ms Enright said that in reviewing the rent supplement scheme, the interests of tenants and the provision of good-quality accommodation must be protected.
“Since the budget, the Government has concentrated its efforts to achieve savings by imposing stealth taxes on low-paid civil servants, restricting the eligibility criteria to jobseekers’ benefit, and reducing supports for special needs children, instead of examining inefficiencies within the system where real savings could be made.”
Under changes introduced in the budget by Minister for Social and Family Affairs, Mary Hanafin, the minimum contribution for people on rent supplement was increased from €13 to €18 per week.
She said this was aimed at bringing the personal contribution more into line with the level of rents paid by tenants in local authority accommodation on similar income levels.
The Social Welfare (Miscellaneous Provisions) Bill, passed recently in the Dáil, sets the maximum amount of rent supplement that may be paid to landlords. This varies across different localities.