Adjournment Matter. - Rent Subsidy.

Friday, 26 June 1998

Seanad Éireann Debate
Vol. 156 No. 6

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Mr. Costello: Information on Joe Costello Zoom on Joe Costello This matter relates to the rent subsidy paid by the health boards to people in need of accommodation in private rented dwellings. It has come to my attention that in the past week or so some variation has arisen in respect of the manner of payment of this subsidy. In my opinion this will prove detrimental to the intention of the health boards and the Department of Social, Community and Family Affairs.

Since the Monday before last, many community welfare officers began issuing rent subsidy payments at health centres — heretofore such payments were made at post offices — where people need only use their swipe cards to obtain their rent subsidies and social welfare benefits — unemployment benefit or assistance — in one lump sum. In the past they received their social welfare payments on a weekly basis while the rent subsidy was passed directly to their landlords, requiring that they need only pay the additional amount required to cover the balance of rent due. Now, however, these people are receiving a large sum of money weekly, part of which they must pass on to their landlords. In the past landlords received rent subsidy payments four weeks in arrears but they did receive the money directly.

In my opinion there are many vulnerable people living in private rented accommodation, such as the homeless, drug addicts and those who do not look to the future in terms of cash in hand. These people do not believe in saving for a rainy day and once they have cash in hand they treat it like hot money which must be spent. From her clinics, the Minister will be aware that such money can be easily frittered away and not used to purchase essential household items.

Now that people are receiving their rent subsidy payments direct they are obliged to pass the money on to their landlords weekly. I am not usually contacted directly by landlords in respect of these matters but a number have been in communication with me and informed me that they are not being paid. I have also been informed that they do not expect to be paid next week and [421] they are concerned that the situation will become worse.

The Department or the health boards decided — I am sure with the best intentions — to streamline the system and make payments on a weekly rather than a four weekly basis. If landlords do not perform their duties in terms of ensuring that accommodation is kept up to standard, tenants have the right to withhold rent. As already stated, previously rent subsidy payments were made directly to landlords and tenants could not stop those payments. Given that the rent subsidy is being paid directly to tenants, they seem to be empowered to do as they wish but the opposite is true. In practice, tenants will be in a worse position than heretofore because landlords will begin to evict them for non-payment of rent. This will add to the homeless lists and increase the number of people in hostels. It is a serious matter.

A new unit was established in Park House to work on the new system which was introduced with the best intentions. However, unless logic in the planning department in Park House corresponds to what is happening on the ground and how people behave, the end result will be good theory but bad practice. In this case it will be bad practice and enormous problems will arise in the north inner city, including the areas of Summerhill, East Wall, Sheriff Street and Ballybough where there is substantial deprivation and disadvantage. These problems will be compounded. Many of the 2,500 people in those areas who will be in receipt of rental subsidy on a weekly basis will get the money into their hands and they will be expected to pay their landlords directly. They will be handed cash rather than a cheque or a voucher and they will be expected to bring it from the post office to their landlords. It is important to bring this matter to the attention of the Minister for Social, Community and Family Affairs to ensure he takes action at an early stage.

Minister for Public Enterprise (Mrs. O'Rourke): Information on Mary O'Rourke Zoom on Mary O'Rourke I am responding on behalf of the Minister for Social, Community and Family Affairs, Deputy Dermot Ahern, who is away. I listened carefully to Senator Costello's contribution. The Senator deals with a greater number but I also deal extensively with constituents who, through no fault of their own, must seek rental subsidy. The supplementary welfare allowance provides for a weekly or monthly supplement to be paid in respect of rent to any person in the State whose means are insufficient to meet their needs.

The purpose of the rent supplement is to assist with reasonable accommodation costs of eligible persons living in private rented accommodation. Entitlement to the supplement is determined by the health board in light of the circumstances of [422] each case. Payment is normally calculated to ensure that the person, after payment of the rent, has an income equal to the rate of supplementary welfare allowance appropriate to their circumstances less £6. This amount represents the minimum contribution which applicants are required to pay.

The Eastern Health Board has introduced a new computerised system about which Senator Costello has reservations. This system in the specialised housing unit for rent supplement payments has been in operation since 16 June last. As a result of computerisation, all rent supplements will be paid directly to recipients on a weekly basis. Prior to this, they were made manually and four weeks in arrears so the new system is a good idea. Previously, payment was made to the applicant or directly to the landlord with the applicant's consent. Paying the landlord directly assisted in the operation of the manual system. In addition, paying for four weekly periods reduced the number of payments which the health boards had to issue manually and the need for the applicant to call to the health centre on a weekly basis for the money.

The basis for the new system is sound. Some people consider the need to collect their payments undignified. The computerised system offers the facility to pay rent supplement directly to the applicant on a weekly basis by combining it with other social welfare payments. Rent supplement cases are reviewed on a regular basis.

I am aware of the issue raised by Senator Costello. Two cases were referred to my office this week as the new system will be operational in the other health board areas soon. I undertake to speak to the Minister for Social, Community and Family Affairs about it. The system is a good idea because it involves computerisation which empowers people. They will get the money for their rent directly. As Senator Costello said, he is not pushing the case for landlords. He wants to ensure people maintain roofs over their heads and do not stop paying rent.

The Department of Social, Community and Family Affairs has done much good work regarding the budget management scheme which is of great assistance to people. The new system for rent supplement will give the money directly to people weekly. This is empowerment but the vagaries of human nature and the exigencies of living on a very limited income may lead, in my view, to difficulties. This matter needs to be monitored. The health boards have said they are monitoring it and, as yet, have encountered no major discrepancies. However, it is still early days.

The Senator's concern is duly noted. I am sure the Minister would say that the scheme should be given a chance because it will be worthwhile if it works. I will pass on the Senator's concerns to the Minister. The new system will be in operation [423] in all the health board areas soon and if, as I hope, it works, it will be a much more satisfactory way of dealing with rent supplements. However, I agree with the Department of Social, [424] Community and Family Affairs and the health boards that the scheme needs to be closely monitored.

The Seanad adjourned at 12.20 p.m. until 12 noon on Tuesday, 30 June 1998.

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