Aberdeenshire council to be asked to limit rent increase to 2.5%

By bellmannews / January 30, 2023
Child's toy house

Aberdeenshire Council’s Communities Committee is to recommend that the authority limits council rent increases to 2.5% from April this year.

The recommendation follows detailed considerations on Friday (Jan 27) by the committee, which discussed options developed with the housing service aimed at maintaining services while limiting the financial impact on tenants.

A total of six options had earlier been investigated by a working group of councillors and council officers, with a sample of tenants consulted on the possibility of a rent freeze, or rises of 2.5% or 5%.

The Rent Strategy Member Officer Working Group, initially set up to consider the impact of Covid 19 on the council’s rent strategy, examined projected rates of inflation, the cost of borrowing and rental income on the council’s housing revenue account (HRA) business plan.

Committee members heard of the challenges faced by tenants, with 19% of those who responded to a survey saying they were coping ‘quite poorly’ or ‘very poorly’ in the face of cost-of-living pressures.

Tenants indicated a preference for a rent freeze or 2.5%, although both options would lead to a reduced income for the HRA and impact delivery of the associated 30-year business plan.

Head of Housing & Building Standards Rob Simpson explained that a rent freeze would lead to a fall in income of around £1.5million, which would have required savings to be identified within the service, either through reducing spend on projects or perhaps even affecting jobs.

As such, an interim review of the account is to be undertaken to determine the impact of the reduced income that the limited 2.5% rise would generate, with recommendations to be prepared for adjustments in services provided to tenants and service users.

The committee also considered heating and lighting costs for sheltered housing facilities, which for the past two years have risen well below the significant rise in energy costs.

Having previously been able to limit the impact of the energy crisis on sheltered housing residents, lighting and heating costs will rise by an average of just under £20 per week from April if the recommendation is supported. Other sheltered housing service and support charges will increase by 5.9%.

As part of the council’s work around tackling poverty and inequalities, pathways of support are being developed with partners including NHS Grampian and the Aberdeenshire Health & Social Care Partnership to ensure quick access to support and advice for those experiencing cost-of-living challenges.

Discussions will take place directly with sheltered housing tenants, including advice around energy costs and details of national funding schemes as they become available. This is in addition to support provided directly by the housing service.

Working group member Cllr Glen Reynolds spoke of the detailed work undertaken to ensure the rent strategy remains affordable and deliverable and the importance of a detailed review of the service’s business plan.

Committee chair Cllr Anne Stirling assured the committee that the review would be ‘inclusive and comprehensive’ and would continue to take account of various perspectives, including those of tenants.

As part of ongoing engagement with tenants, council officers have met with the Sheltered Housing Tenants Forum and have contacted the Tackling Poverty and Inequalities Lived Experience Forum.

Speaking after the committee, Cllr Stirling said: “The committee’s recommendations are the result of a significant amount of data, discussion and engagement involving council officers, councillors and, most importantly, tenants.

“The recommended increase would mean an average rise of around £4.40 per week for the majority of tenants, but we do recognise the additional pressures around energy costs for those in sheltered housing and a programme of support is being put in place to help those who are finding things difficult.”

Committee vice-chair Cllr Hannah Powell said: “Limiting the rent increase to 2.5% minimises the impact for tenants and provides vital funding for the housing revenue account but there remains a need to review our business plan to ensure it remains deliverable and affordable.

“We will continue to involve tenants and tenant groups as we undertake this comprehensive review over the coming months, while continuing to make support available to all those who need it.”

The recommended rent increase and other charges will be brought before a full meeting of Aberdeenshire Council on Thursday, February 9.