THE RENT supplement paid by the Government to the landlords of tenants claiming social welfare payments is to be cut by up to one-third. The decreases reflect the collapse in rental values in parts of the country where there is a glut of housing as a result of the boom.
The counties where the supplement will decrease by the maximum amount are Leitrim, Longford, Cavan, Roscommon and Monaghan, where tax incentives have left a number of ghost estates.
The biggest changes will affect single people in shared accommodation, couples or one-parent families with three children, where the minimum amount to be paid will decrease from €663 a month to €500 a month.
The current rental supplement paid to a couple with three children living in a three-bedroom house in Roscommon will fall from €780 a month to €520 a month, a 33 per cent decrease.
Couples living on their own or with one child and one-parent families with one child will see the minimum payable rent reduce from €568 a month to €400 a month, a decrease of 30 per cent.
The Government hopes to save €20 million a year out of a total rent supplement bill of €500 million, a saving of 4 per cent.
There will be no change to the rent supplement paid for single people living on their own because the market remains buoyant in that category.
It is the second time the Government has cut the rent supplement it pays to landlords. In 2009 it cut it across the board by 8 per cent, but this time the changes reflect regional demand for rented accommodation. There is only a marginal decrease in the amounts paid to landlords in Dublin city.
Minister for Social Protection Éamon Ó Cuív said the changes reflected a “buyer’s market” because of the oversupply of accommodation. The new figures were based on the latest CSO figures which show an 8 per cent decrease in rents nationwide.
The changes will apply only to those renting for the first time or those in receipt of rent supplement who are coming up for a rent review. They will only apply to landlords. There is no change in the €24 a week that social welfare recipients have to pay for their own accommodation.
Focus Ireland welcomed the Government’s decision not to cut the rent supplement for single people, but said the the Government must ensure that landlords act to cut the rents and not leave it to tenants to make up the loss in the landlords’ incomes.
Mr Ó Cuív also said he was prepared to take on board the views of all parties when the controversial proposed amendment to the one-parent family payment is debated in the Dáil next week.
