€11.3m in rent arrears is owed to county council

HOUSING rent arrears have dramatically increased in South Dublin County Council during Covid – a total of €11.3m is currently owed to the local authority.

A staggering 55 per cent of the 9,878 tenants in the county are in arrears, according to the latest billing and collection statement by the council.

Some 3,069 accounts are in arrears by more than 12 weeks, and 582 accounts are in arrears for more than two years.

In the 45 per cent group who are not in arrears, over €2m has been paid in credit – i.e: some of the tenants have paid rent for the coming weeks or months on their respective accounts.

Despite the establishment of a debt management unit in 2019, arrears have continued to spiral out of control.

The work of the debt unit was impeded for a large part of 2020/21 due to lockdowns and incapacity to go door-to-door, but arrears have been a long standing issue in the county.

Speaking at council meeting on Monday, South Dublin County Council CEO Daniel McLoughlin, acknowledged it was a “serious issues of concern” and a “substantial increase of rent arrears since March 2020.”

Mr McLoughlin said the arrears was €9.3m, an increase of 16 per cent since March 2020.

The figure was questioned by Cllr Ronan McMahon (Ind), who believes credit from accounts who have paid in advance, should not be subtracted from the total arrears.

Speaking at the meeting, Mr McLoughlin said the difference is the council “always deal with net arrears” in dealing with housing arrears, and that Cllr McMahon was not comparing “like with like”.

As for the reasons tenants fall into arrears, Mr McLoughlin said it varies between “people needing some carefully worded advice and terms of understanding in paying their rent”, and the “other end of the spectrum is wilful neglect”.

Speaking to The Echo on Tuesday, Cllr McMahon said: “There is no such thing as net arrears. I’m an accountant. The arrears is €11.3m. In May 2018, it was €8.9m, that is a 27 per cent increase today.

“If the council were to collect all of that €11.3m, it would be like a windfall and very helpful in the upcoming Budget. There is a long list of things they could do with the money, including housing. We have been tolerating the numbers getting bigger for years, when they should be getting smaller. People’s mortgages and private rents are not tolerated.”

At the meeting, Cllr Brian Lawlor (FG) was puzzled why there was millions owed when the differential rate for tenants in the county is capped at 10 per cent of the total household income.

For example, if the household income is estimated at €500 a week, the rent is capped at €50 per week.

In Dublin City Council, the differential rate is 15 per cent.

“We have the lowest differential rate of all the 31 local authorities in Ireland, I can’t understand it. This has got out of hand the last few years,” said Cllr Lawlor.

Cllr David McManus (FG) says the council have been very “fair and compassionate” in dealing with tenants and “genuine” cases, but he would like to “see a more pro-active hands-on approach”.

“It is interesting. I have seen figures from Cluid Housing, and they have arrears of only 3.5 per cent,” he said.

“I think there are structural problems when an approved housing body are more organised. In fairness to the chief executive, as he said, this affects tenants in arrears aswell, but it is also unfair to those paying on time. The ultimate endgame is eviction and nobody wants that.”

Cllr McManus asked the council for the number of accounts in arrears this week, and the reply was 3,958 accounts in arrears, which differs significantly from the council’s billing and collection statement, which indicates that 5,426 accounts are in arrears.

The response to Cllr McManus said 52 tenants are in arrears for more than five years.

Speaking at the meeting on Monday, Mr McLoughlin said the council have a “significant job of work to do” to address the increase during Covid.

“The debt management unit was established in 2019 but really didn’t get to do it’s work, so we would expect there to be significant inroads made in that figure in the near future and beyond. It is to everyone’s benefit, including the tenants in arrears that we start to get to grips with this really quickly,” he said.

Cllr McMahon said: “I don’t think this is about Covid. That didn’t prevent people picking up a phone. This has been going on for years, since I first joined the council. I bring it up every couple of meetings.

“These are huge figures. A business wouldn’t survive these debts. Mortgages are not capped at 10 per cent, many are 50 per cent of their income. If rent is capped at 10 per cent, you really shouldn’t be going into arrears.  The highest income for a prospective tenant was asked before, and the figure I saw was 120k net income, with a rent of 12k per year.

“The low differential rate also means people want to come here from other local authority areas, putting more pressure on locals, and on residents trying to get off housing lists and into a home.”