Government defends 'incredibly poor value for money' HAP scheme 

Last year the Government spent just under €654m on Housing Assistance Payment and the Rental Accommodation Scheme.

The government has defended the Housing Assistance Payment for social housing provision saying that to acquire properties instead would require “very, very large numbers” of homes to be bought.

At the Public Accounts Committee, Secretary General of the Department Graham Doyle, while acknowledging that HAP and RAS (Rental Accommodation Scheme) represent poor value for money for the Exchequer, said that any wholesale acquisition of such properties from landlords for social housing would have to be considered in terms of how it would affect the overall housing market.

Under questioning from Fianna Fáil’s Paul McAuliffe, Mr Doyle said that historically “a lot of people have been critical of the acquisition of social housing” by the State, leading to the practice being scaled back.

Asked if it made sense to buy up such housing rather than subsidising payments to private landlords, Mr Doyle said: “It depends on what level of scale you’re talking about, and if it is done at scale how it would affect the housing market would have to be very seriously considered."

He said that last year the Government spent just under €654m on HAP and RAS, something Mr McAuliffe described as “a monumental amount of public money” and as being an “incredibly poor value for money” method of securing public housing.

Mr Doyle said there are 76,000 units currently under HAP and RAS, and roughly 40,000 landlords in receipt of rental payments for the schemes.

He added, however, that each HAP tenancy costs the State an average of €9,000 per annum, whereas in order to acquire those homes straight from the landlords “at that volume, a couple of hundred thousand to acquire each one, we’re talking about very, very large numbers”.

Mr McAuliffe countered that a large capital funding provision was put aside in the recent Budget which could be used to that end, something he believes to be a “no-brainer” situation.

Mr Doyle said that there were 4,000 exits from HAP in 2022, though the numbers are not reducing as fast as the Department would like.

The Central Statistics Office recently reported that, while there was indeed a reduction in the number of HAP tenancies in 2022, two in five of those exiting the payment then moved on to another form of social housing.

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The Department was also taken to task over the distribution of local property taxes to individual local authorities, with the Social Democrats’ Catherine Murphy saying “none of it makes sense to me”.

Ms Murphy said that having trawled the total spend of all the local authorities, she had found that some counties with a smaller population are bringing in more in property tax than other areas with growing populations.

“I don’t understand the baseline review of Cork, where Cork City gets the minimum increase and the county gets the big gain,” she said.

While individual local authorities have some discretion as to what levels of the tax they can charge, any changes have to be ratified by elected council members via a vote — with Dublin City Council notably rejecting an increase to the tax earlier this month.

Ms Murphy said the trend is “unsustainable for local authorities which are growing — they can’t provide services”.

She described the scenario as “the greatest scam going” and said she is “seriously considering” making a complaint to the European Commission regarding that aspect of local governance.

“People are paying local property tax, but it’s anything but local,” she said.