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New Housing Assistance Payment (HAP) Scheme Commenced in Limerick, Cork, Waterford, Kilkenny, Louth, Monaghan and South Dublin County Councils

This new scheme is a very significant change to the system of social housing support – recipients of HAP are deemed to have their housing need met and will be taken off the housing list

The new Housing Assistance Payment (HAP), which is to replace rent supplement except for those who need short-term support only, has been brought into force on a pilot basis in certain areas:

  • with effect from 15 September, in Cork County Council, Limerick City Council, Limerick County Council, Waterford County Council and Waterford City Council.
  • With effect from 1 October, in Kilkenny, Louth, Monaghan and South Dublin County Councils.

The Department of the Environment aims to implement HAP on a national level in 2015, as stated in the Department of the Environment Housing Circular 40/2015, dated 12 September 2014.

Background to HAP

The new Housing (Miscellaneous Provisions) Act 2014 (the 2014 Act) was signed into law in July 2014. The Act is being brought into effect incrementally. Sections 35 to 51, provide for the establishment of HAP. Regulations implementing these sections, apart from two of the sections, were published on 15 September and 1 October. Statutory Instruments (SIs) 404 and 405 of 2014 implement these sections and SIs 406 and 407 provide for the scheme to be put in place firstly in Cork County Council, Limerick City and Council and Waterford City and Council. SIs 407 and 428 of 2014 flesh out the detail of the housing assistance payment scheme, including the information to be provided by the tenant to support the request for the payment, the time period for the landlord to comply with the requirement to provide a tax clearance certificate and the rent limits.

HAP represents a very important change to the social housing assistance landscape.

How HAP is different to rent supplement

HAP will operate in a similar manner to rent supplement and the HAP rates for the areas of the pilot scheme are set at the current rent supplement levels (SI 428 of 2014). However, there are significant differences:

  • Full rent paid by housing authority directly to landlord:

The recipient of HAP enters into a normal tenancy agreement with the private landlord but the housing authority will pay the full rent for the accommodation directly to the landlord on behalf of the household (Part 4 of the 2014 Act).

  • Tenant to pay a contribution to the housing authority (not yet in force):

Section 44 of the 2014 Act provides that the tenant will pay a rent contribution to the housing authority, calculated in accordance with the authority’s differential rent scheme. This means that the tenant will pay a certain amount to the local authority that will vary according to the tenant’s income. Section 53 of the Act provides for the deduction by the Department of Social Protection of HAP rent contributions from social welfare payments. These sections have not been commenced and so are not yet in effect.

  • Once a household is in receipt of HAP, they are deemed to have their housing need met and will be taken off/not put on the housing list:

Section 37 of the Act provides that once a household is in receipt of HAP, that is to “deemed to be an appropriate form of social housing support” by the housing authority.  Section 20 of the Housing (Miscellaneous Provisions) Act 2009 obliges local authorities to carry out that assessment for applicants.

Section 37 of the 2014 Act means that households who receive HAP will be removed from or not placed on the housing list. Section 45 of the 2014 Act provides that household receiving HAP can, however, apply to transfer to “a specified form of social housing support”. This means that the household can apply to transfer to local authority accommodation and be entered on the transfer list.

The benefits and pitfalls of HAP

The key benefits of HAP are:

  • Recipients may take up employment and still retain their entitlements to housing support. This development is very welcome;
  • Landlords do not face the risk of rent arrears as the Department of the Environment will be paying the landlords directly. It is hoped that this will encourage landlords to accept HAP;
  • Local authority inspections will be carried out to ensure that dwellings included in the scheme meet the required minimum standards for private rented accommodation (s 41 of the 2014 Act).
  • HAP may be given to a person who is separated and has a claim on the family home which has not yet been resolved (s49 of the 2014, amending s 20 of the Housing (Miscellaneous Provisions) Act 2009).

Former Minister of State for Housing Jan O’Sullivan TD described HAP in the following terms: “The introduction of a new HAP payment, operated by local authorities, represents the largest reform of housing support in a generation. The current system isn’t fit for purpose and it needs to change. The new HAP payment will eliminate poverty traps, encourage people to take up work and bring a new “joined-up” approach to housing support.”

HAP is a welcome new scheme allowing recipients to work while receiving housing support for rental accommodation. However, it is of real concern that the State, with this scheme, is moving from the social housing list system, which aims to provide secure long-term housing for those who are homeless, to a system that relies on the private rental sector to provide sufficient housing. It is clear that there is simply not enough reasonably priced private rental accommodation, particularly in urban areas, to meet the demand. Along with a problem of lack of supply of private rental accommodation, it is increasingly difficult to find landlords who will accept rent supplement, due to, among other issues, the low level of rent supplement compared to market rent. It remains to be seen whether more landlords will be willing to take on tenants through the HAP scheme.

 

Useful links:

Link to Housing (Miscellaneous Provisions) Act 2014

Link to Minister Jan O’Sullivan TD press release, dated 17 June 2014.

Links to Statutory Instruments implementing the 2014 Act HAP provisions: SIs 404, 405, 406, 407, 427, 428, 429

Links to Circulars: Department of the Environment Housing Circular 40/2015 dated 12 September 2014; 41/2014 dated 30 September 2014

Link to Ministerial directions dated 12 September 2014 and 29 September 2014

 

 

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2014-10-02T11:48:34+00:00October 2nd, 2014|News|