Council tenants in Newark could see their rent increase by over £200 a year if new plans are approved. Newark and Sherwood District Council is proposing to increase rent across all of its properties by 5% from April.
The average increase would cost tenants an extra £4.22 a week – or £219 a year. As of November 2022, the council had 5,441 tenants.
But Conservative Councillor Tim Wendels, portfolio holder for homes and health, said the move would affect the 35% of tenants who do not claim benefits. He said the council would also create a £300,000 fund to support tenants who struggle with the rise.
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Cllr Paul Peacock, leader of the Labour group, said he could not see a justification for the increase. The issue was discussed at the Newark and Sherwood District Council Cabinet meeting on January 17.
The proposals will now go to a full council meeting for further deliberations. Cllr Wendels said the Government capped rent increases this year at 7%.
He said: “While 7% is the most financially beneficial, the modelling shows that 3% is not affordable and would lead to borrowing at increasingly high interest rates. 5% is currently affordable and sustainable and is therefore the increase recommended on all of our tenanted properties, both general needs and supported housing.”
Cllr Wendels added that 65% of tenants are in receipt of housing benefits or universal credit and would not be impacted by the increases. Papers add that the council’s average social housing rents for general needs tenants are “significantly lower” than those in the private rented sector.
Cllr Peacock said: “It won’t be a surprise to know I’m not supportive of the 5% increase and certainly members of my group aren’t. The justification of the increase lacks any sort of detail whatsoever.
“I’ve not been privy to the detail I need. The 65%of people who claim benefits, I am not convinced they will be unaffected, I need clarity on that.
“I need clarity on how we would use the £300,000. I am also concerned in 12 months’ time we may not have another £300,000 to put aside to help people who are struggling to pay rent.”
Cllr Wendels added: “The recommendation we are putting forward recognises the impact on the 35% who are not in receipt of those benefits and seeks to minimise the increase for those tenants, while ensuring an excellent housing service can be provided to our tenants. For those tenants struggling to meet the rent increase, it is proposed to set up a £300,000 fund to support tenants including a tenant welfare fund.
“We are taking a balanced approach to support tenants as much as possible whilst continuing to take a responsible approach to ensure a suitably long term funded Housing Revenue Account business plan.”
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