Rent Supplement & Housing Assistance Payment to increase in both rural & urban areas
Minister for Social Protection Leo Varadkar and Minister for Housing, Planning & Local Government Simon Coveney have confirmed that Cabinet has agreed to increase rent limits under the Rent Supplement and Housing Assistance Payment (HAP) schemes.
The new limits mean that people who cannot afford the full cost of private rented accommodation will receive greater assistance from the State from this Friday, July 1st.
Speaking following Cabinet, Minister Varadkar said: "These new rent limits reflect the fact that rents are rising right across Ireland and are back to their peak levels in some places. Through a combination of increased rent limits, and the ongoing flexibility and discretionary increases provided by my Department’s Community Welfare Service staff, we will provide more stability for tenants and reduce the danger of families becoming homeless when their rent is increased.
"This Government wants to ensure that our recovering economy works for everyone. We aim to achieve that by promoting an enterprise economy, making work pay, investing in public services, ensuring opportunity and a fair go for everyone. We must ensure that we have a strong safety net so that everyone has a roof over their head. In many cases, Rent Supplement or Housing Assistance Payment is that safety net."
Minister Coveney added that "As Minister for Housing I am determined to tackle the housing crisis that Ireland is currently experiencing. This requires a range of measures from all sectors involved, both short and long term. I’m confident that the new limits being announced today will help alleviate the pressure experienced by families in the private rented sector, while other longer term housing measures are put in place. They will help households to remain in their existing homes while also providing sufficient flexibility to enable people to source accommodation in a constrained rental market."
Every county or county sub-district in Ireland has a maximum rent limit, within which Rent Supplement can be paid. This new measure agreed by Cabinet means that maximum rent limits will increase in every part of Ireland, with the increase reflecting the pressures on rental properties in each particular location.
For this reason there are increases in both urban and rural areas reflecting local rents, including a 25% average increase in Laois and Roscommon; a 21% average increase in Leitrim, Cork City, Longford, and Galway City; a 29% average increase in Dublin, a 19% average increase in Westmeath, Kildare, and Louth; and a 15% average increase in Cavan and Donegal. (This average increase reflects the combined weighted increase in Rent Limits for the following categories: Single Shared; Couple Shared; Single; Couple; Couple/One Parent Family with 1 child; Couple/One Parent Family with 2 children; Couple/One Parent Family with 3 children).
What’s more, anyone who has entered an informal top-up arrangement with their landlord is advised to contact their Community Welfare Service for assistance, as the Department of Social Protection will regularise these top-ups in most cases.
These measures fulfil the Programme for a Partnership Government commitment to increase limits in line with geographic variations in market rents, and to extend the availability of the Housing Assistance Payment.
The new rent limits are benchmarked at the 35th percentile of agreed rents as collated by the Residential Tenancies Board. This measure will cost up to €15 million in 2016, representing €12 million under the Rent Supplement scheme and €3 million under the HAP scheme.
In recognition of the continued shortage of supply in the rental market, discretion will continue to be available under the Rent Supplement scheme. The capacity of local authorities to make discretionary enhanced payments will be extended to all authorities operating HAP. Advice and advocacy will also continue to be available under the Tenancy Protection Service operated by Threshold which is now operational in Dublin, Cork, Galway and the commuter counties of Kildare, Meath and Wicklow. This flexible and targeted approach has already assisted over 8,700 people to retain their homes under the Rent Supplement scheme.
The Government will continue to monitor the measures in place to ensure that the appropriate supports continue to be provided to tenants into the future.
There are currently approximately 55,000 customers in receipt of the supplement at a cost of over €267 million in 2016. Rent limits (in place since June 2013) are set at levels that enable eligible households to maintain basic suitable rented accommodation, having regard to the different rental market conditions that prevail in various parts of the State. At this time of constrained supply, the Department of Social Protection continues to implement a targeted, flexible, case-by-case approach where rents exceed limits. This flexible and responsive approach is a key instrument in assisting families to keep their homes and has supported over 8,700 Rent Supplement households through increased rental payments who were at imminent risk of homelessness.
Approximately 120 increased rental payment cases are presenting weekly where there is an imminent risk of homelessness. The introduction of revised rent limits will regularise the current policy approach and will provide increased transparency.
Housing Assistance Payment (HAP)
The HAP scheme is being implemented in stages across Ireland and is currently available in 19 local authority areas. More than 10,000 households currently in receipt of housing support under the scheme at a cost to the Exchequer of €48 million in 2016. On the basis of current rates of growth for the scheme, some 16,000 households are likely to be supported by the scheme by the end of 2016 with one third of these coming from households transferring from the Rent Supplement scheme.
HAP will be available in nine more local authorities by the end of 2016 and in the remaining three Dublin authorities early in 2017, completing full implementation.
The Homeless Pilot of the Housing Assistance Payment scheme has been operational since February 2015 across the four housing authorities in the Dublin Region, and is being implemented through the Dublin Region Homeless Executive. The pilot is designed to transition qualified households from emergency accommodation into private rented tenancies. The number of households securing accommodation under HAP continues to rise. Levels of support available under the pilot scheme for Homeless Households were increased following Budget 2016 to 50% above the current Rent Supplement levels. This increased level of support has improved the capacity of the pilot, which has been securing, on average, more than 20 tenancies a month since the enhancement, with more than 200 households currently supported by the scheme.