Maximum rent supplements limits are to be reduced by up to 36% for tenants who are entering into new leases or renewing leases.
However, the supplements for single people are to remain largely untouched.
Minister for Social Protection Eamon Ó Cuiv said the reductions were designed to reflect the reductions in the rental market and would ensure that landlords are not charging artificially high rents.
The rate for couples or one parent families with one child has dropped from between €568-€932 to between €400 and €930.
The rate for couples or one parent families with three children has been reduced from between €663-€1,110 to between €500-€1,100.
The Minister says the measure is expected to save up to €20m this year.
He said these rates related to the next eighteen months but that they would be reviewed if rents increase during that period.
95,000 households are supported by rent supplement, which the Department of Social Protection says is about half of the total private rented market in Ireland.
In 2009 the Department paid over €500m in rent supplement.