Limits on rent supplement payments set by the Government are forcing thousands of families to make undeclared top-up payments to landlords to secure places to live.
TDs and senators have complained that limits set by the Department of Social Protection on payments to assist low-income families to obtain private rented accommodation failed to reflect rental prices in the market.
They also expressed concern that the problem of such unrealistic limits was being exacerbated by the unlikelihood of landlords declaring such top-up payments for tax purposes when the issue was raised at an Oireachtas committee meeting last week.
Labour senator Marie Moloney said the €84 weekly limit for rent supplement for a single person in Co Kerry bore no resemblance to prices in the private rental market in Killarney.
Labour TD Brendan Ryan said landlords were denying rental properties to rent supplement applicants because of the existing limits, while they were also forcing families to move into areas where they did not wish to live.
His party colleague Patrick Nulty said rent supplement payments had become an integral part of the social welfare scheme, despite being intended as a short-term measure.
He observed that there was “a complete disconnect” between the limits and actual rents with gaps between the two of up to €225 per month in Dublin.
Fine Gael TD Denis Naughten questioned the logic of setting one limit for some counties which failed to distinguish between rents in urban and rural parts.
In reply, the department’s assistant secretary, Helen Faughnan, said a review of the existing limits was being carried out and it is expected revised caps would be introduced by June.
However, she insisted the current limits were based on publicly available data including actual prices compiled by the Private Residential Tenancies Board as well as asking prices from property websites.
Ms Faughnan said hands were tied in relation to top-up payments if tenants failed to inform the department of the issue.
She added that it was an offence for landlords to make false declarations about rental income.
Ms Faughnan told the committee that €403m was being spent on the rent supplement scheme this year which would provide support to 86,000 recipients. A further €2.3m is spent on providing rent deposits to around 5,600 individuals.
The department funds 30% of the private rented sector, said Ms Faughnan. However, she acknowledged that there was a shortage of rental accommodation in Dublin with just 2,000 units available last month — the lowest level in eight years.
However, Labour senator Aideen Hayden , who is also chairperson of the housing charity, Threshold, said the department had been cutting its level of support for rent supplement payments over the past few years.
She estimated limits were now on average around 25% below the value of actual rents charged by landlords.
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