Recession blamed for inadequacy of rent schemes

COMMITTEE ON SOCIAL PROTECTION:THE NUMBER of long-term recipients of what are supposed to be short-term rent supplements has doubled since a scheme to address the issue was established in 2004.

Officials from the Department of Local Government told the Oireachtas Committee on Social Protection yesterday that the growing number of cases, due to the recession, could not be addressed under either the original or most recent schemes.

The rental accommodation scheme (Ras) was established seven years ago to provide better value for money for the exchequer than the rent supplement scheme.

In contrast to the supplement scheme, Ras is not intended to be solely a short-term income support for the temporarily unemployed. It involves the tenant and the landlord entering into an extended contract, usually about four to five years, for a discounted rent price. The incentive to the landlord is the security of having a long-term tenant while the State saves money by paying a discounted price of about 8 per cent less.

It was envisaged that recipients with long-term need would be transferred from the rent supplement scheme to Ras or other social housing options.

Seven years after the establishment of Ras, the numbers availing of the original rent supplement scheme on a long-term basis (more than 18 months) has risen to over 51,000, about double the number availing of it in 2004.

“Ras was never designed to, and simply cannot, address the volume of cases resulting from the recession. What we can do is push the scheme as far as possible to maximise the rate of transfer of eligible households,” said Michael Layde, assistant secretary at the department.

Mr Layde added that the scheme had met its targets in terms of the number of transfers to it from rent supplement, but that numbers in the latter scheme continued to rise despite this.

“This is mainly due to the current economic circumstances and the consequent reduction in the number of households able to afford their own accommodation without State support of some form,” explained Mr Layde.

Since 2004, more than 36,000 households have transferred to either Ras or social housing from the rent supplement scheme, including 4,620 this year up to the end of September. This has not curtailed numbers on rent supplement, with close to 97,000 households in receipt of that support as of the end of June 2011.

Labour TD John Lyons suggested Ras was not the “silver bullet” solution envisaged.