Threshold chairperson Aideen Hayden said there is evidence that local authorities are to blame for the persistence of sub standard accommodation being offered.
Speaking on RTÉ’s Morning Ireland, she said: "€24 million between 2005 and 2012 was handed over by the Department of the Environment to local authorities to carry out inspections of rented properties.
"The fact that a significant number of them, over the last few years, carried out no inspections at all is not good enough."
Senator Hayden said Threshold has again called for a NCT-type inspection for rented accommodation to be introduced.
"Before a landlord is entitled by law to rent a property it should be certified as fit for purpose.
"In the way that you walk into restaurant and know that you are protected, you drive a car that has an NCT, you have a rented property that has a certificate to say it is fit for purpose."
The charity called on Ms O'Sullivan to rectify the problem by putting a certification measure in place.
The minister said she wanted to see best practice shared among local authorities and would "engage" with Threshold over measures such as a certification system.