Hike in council rents - ‘repossessions inevitable’
A rent hike for Stevenage social tenants of almost seven per cent was approved by councillors last night (Wednesday).
The rise of 6.8 per cent from April will mean an extra �5.65 per week on the average council tenant’s bill, equal to �293.80 a year.
The figure is less however than Stevenage Borough Council finance officers’ recommendation of 7.8 per cent, which would have left the 50 per cent of tenants not on housing benefit needing to find another �337.48 next financial year.
The officers’ figure was calculated using a government formula which takes into account rental income and the need to service a �218m Treasury allocated debt over 30 years. The debt was taken on by the previously debt free authority in return for keeping its rents.
Strategic director Marcel Coiffait said the one per cent drop in income, equal to �350,000 a year, could be met by savings made by restructuring Stevenage Homes. The previous arms-lengths housing management company was brought in house last December, cutting jobs and duplications.
Housing portfolio holder Ann Webb who described the authority as socialist Labour, recognised the increase would hurt families and admitted she was “disgusted” by the move. But she added if it was not put in place now it would mean larger rises in future years.
Council leader Sharon Taylor said the money was also needed to maintain social housing in the town. “We would like to do more but we have a large programme of work to undertake and any drop that we take will eat into the programme, which means we wouldn’t have enough,” she said.
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The increase was criticised by Stevenage Citizens Advice Bureau for putting pressure on working people and the council’s housing benefit budget, and threatening families with homelessness.
Social policy coordinator Kate Farquhar said: “The bureau is concerned that the rise, at a time when wages are frozen or barely rising, may lead to families losing their homes. The CAB will assist those who contact us for help, either through the bureau or court desk - however repossessions will be inevitable where incomes are badly squeezed by other rises in basics such as food, clothes, utilities and travel costs for work. The housing alternatives are renting smaller private property, which may be too small for families’ real needs, or relocation out of the area.”
Opposition leader on the council Graham Clark, who as a member of the leader’s priority service group has been privy to the figures, said: “I would like it to be less but it’s unavoidable given the situation. We have looked at pretty much everything on housing revenue account savings.”
Lib Dem leader Robin Parker, whose three-strong group voted against the increase, criticised the last Labour government for introducing the formula used to calculate rent increases, before adding the rise could be smaller.
“There is an argument for going lower to five per cent. That would mean higher increases in future years, but people are so pressed at the moment because of the national economic situation. There is no justification for such a big increase now.”
Stevenage MP Stephen McPartland said he was “shocked” by the hike.
“I know many families will feel betrayed by the council. They promised tenants that services would improve when they took over Stevenage Homes, but services are getting worse and rents are increasing.”