Rugby Borough Council rent rise to be approved

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COUNCILLORS will decide tomorrow (Wednesday) on council housing rents for the coming year for Rugby borough tenants.

Rent levels will be set to take account of a one-off payment to the government of £72.949m in return for greater control over the council’s housing stock. This will be paid for through a fixed-rate low-interest loan.

The payment to the government will free the council from the national Housing Revenue Account subsidy system, which this year resulted in more than £4.5million or about one third of tenants’ rents being redistributed to other councils for maintenance of their stock. Freedom from the subsidy system will save council tenants from paying in more than £5.4m in the coming year and an estimated £180m over the next 30 years.

If approved, tenants of Rugby Borough Council will see their rent increase over the next five years to meet the Government’s requirement to make the cost of housing association and public sector rents more equal over a five-year period. To prevent a spike in rents in the coming year because of recent high inflation, the council will smooth this increase over the next five years. The average rise this year will be 6.43 per cent. This rise will also mean that over £13million will be avoided in future interest payments, meaning more cash will be available to reinvest in housing.

Cllr Leigh Hunt, Rugby Borough Council portfolio holder for Sustainable Inclusive Communities, said: “While we understand that a rent increase in these difficult economic times will be hard for many people, we must set rents at a level that will keep our loan repayments down and allow us to reinvest in council homes. Our rents are still significantly below market rents in the private sector, which are also rising.

“Any rise will be unwelcome, but we have set the rents in a way that will minimise the impact on our tenants over the next few years.

“Tenants who are experiencing difficulty paying their rent can make an appointment with a benefits advisor to assess eligibility for Housing Benefit by calling (01788) 533433, or contact their housing officer on their usual number.”