Budget Must Tackle Crippling Rents For 'Working Poor'

Press Releases

Threshold, the national housing charity, is calling on the Government to use the 2006 Budget to help the growing numbers of ‘working poor’ who are struggling to pay crippling rents in the private rented sector. Many workers on minimum wage cannot afford the high cost of renting but are currently ineligible for state aid. Threshold is seeking significant increases in tax relief and the extension of the rent supplement scheme to cover low paid workers. The Government is also being asked to dramatically increase the supply of social housing and to introduce new schemes to provide low cost rented accommodation.

It is estimated that 157,000 people are numbered among the working poor in Ireland, more than 9% of the working population. Many face serious housing affordability problems. The 2002 Irish National Survey of Housing Quality found that over a quarter (28%) of people living in private rented accommodation were spending more than one-third of their income on rent, while a 2004 study by the Combat Poverty Agency, ‘Housing Poverty and Wealth in Ireland’, found that “the most serious affordability problems in the Irish housing system arise in the private rented sector.” Threshold is calling for rent relief to be doubled as a minimum, for example, from €300 to €600 for a single person aged under 55 years, and for significantly higher reliefs to be targeted at low paid workers who experience problems paying their rent.

In the past, many of the working poor would have been allocated a local authority home, but they are now forced to pay high rents because the Government is failing to provide social housing. According to the 2002 Local Authority Assessments of Social Housing Needs, 44% of households on local authority waiting lists were not able to meet the cost of their existing accommodation. Threshold is calling on Government to immediately adopt a recommendation by the National and Economic and Social Council (NESC) that 73,000 additional local authority houses be provided by 2012. This is absolutely necessary to help people out of the poverty trap of the rented sector. Threshold is also seeking the urgent introduction of schemes to provide affordable rental housing, similar to affordable housing schemes for house purchasers, to provide accommodation at lower rents for the working poor.

Aideen Hayden, Chair of Threshold, said:

“It’s not fair that people in low paid jobs get no help with their housing costs. They are doing their bit for the economy, yet much of their income is swallowed up in rent payments. We in Threshold meet people every day who are faced with a terrible dilemma – do I continue working in a low paid job and struggle to pay my rent or do I give up my job in order to get government help? Nobody should be spending more than a third of their income on rent and nobody should be forced to give up a job in order to get help.

The budget provides the Government with an opportunity to introduce better tax breaks on rent for low paid workers. The rent supplement scheme must also be expanded to help the working poor. Most importantly of all, the Government must face up to its responsibility to massively increase the supply of local authority housing for the huge numbers of people on housing waiting lists.”

ENDS

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