Council rent rises by £290 a year

COUNCIL house rents in the region have gone up by an average of £290 per year.

Wednesday, 25th January 2012, 2:05 pm

Rotherham Council agreed on Wednesday to increase rents, blaming Government policy for the rises.

The decision means council households face a 9.45 per cent rise - and average of £5.55 per week from April.

Housing bosses say the increase is necessary because of a long-standing Government policy to increase historically low council house rents to the same level as those of housing association properties, to cover management costs without subsidy.

Rent levels have to be equalised by 2015-16 or councils suffer financial penalties.

But a tenants and residents group fear it could create hardship for some tenants and worsen arrears.

However around 67 per cent of tenants won’t be affected because they receive housing benefit.

Coun Rose McNeely, cabinet member for Safe and Attractive Neighbourhoods for Rotherham Council, said that the authority had little choice but to increase its rents.

“We do appreciate that our tenants, like everyone else, are facing hard times at the moment but unfortunately, our hands are tied because of the rent convergence,” she said.

“Historically, Rotherham tenants have always enjoyed low rents but now because of the need to align our rents with other sectors coupled with the changes to the government subsidy, we are having to increase our rents.”

If the council did not follow the Government’s formula, for every one per cent deviation, the authority would lose around £700,000 of income.

Coun McNeely said while one per cent would have a ‘massive impact’ on its ability to maintain homes, it would only save rent payer 70p per week,

She added: “We do need these resources to be able to continue our commitment to help people to live in good quality affordable housing. “In recent years we have seen a massive investment of £300 million in our council housing stock and we want to make sure we still provide affordable good quality accommodation for a fair rent.”

She pointed out that the change will not affect those residents whose rent is paid through housing benefit payments and local rents are still significantly below national benefit thresholds.

She said: “Something like 67% of our tenants claim partial or full housing benefit and this will obviously continue. We will be including information about Housing Benefit with the notification letters to the tenants of all our 20,000 council properties.”

Steve Ruffle, development manager for Rotherfed, an umbrella organisation for tenants’ and residents’ groups in Rotherham, said the changes could cause real hardship for tenants on low incomes and could worsen arrears.

He added: “Many tenants cannot afford these rises especially as wages are decreasing, benefits are being cut or held to a 5.6 per cent increase, public sector pay is frozen and many pensions and other fixed incomes are falling.”

At the same meeting the council decided to only put up heating charges by the rate of inflation.

Coun McNeely added: “Where the council has more flexibility to keep charges low and does not have to follow a prescribed Government formula we will do our best to try to help local people by keeping any necessary increases as small as possible.”