Council home rents in Portsmouth will increase by 2.7 per cent in late March as part of measures to address a budget shortfall.
The decision to raise social rents was made at a recent Portsmouth City Council cabinet meeting. Councils face pressure to raise rents in line with inflation to recover costs and maintain service delivery.
The council based the increase on the September Consumer Price Index (CPI) inflation rate plus one per cent—the maximum permitted under government guidelines.
Despite this, the council has stated that a five per cent rise would be necessary to fully fund services. The 2.7 per cent increase will generate £2.4m in revenue, but an additional £1.994m will need to be drawn from reserves to balance the budget if no further efficiencies are found.
Rent charges will remain below housing benefit and universal credit limits, ensuring tenants’ full eligibility based on their household, income, and savings.
Service charges will vary by property type. A 1.9 per cent reduction is proposed for tenants in houses and bungalows, while tenants in flats and maisonettes will see a 7.5 per cent increase, reflecting higher staffing costs due to pay awards and changes to employer national insurance contributions.
Sheltered housing charges are also set to rise, with increases ranging from 5.6 per cent to 8.5 per cent, reflecting the growing costs of employing staff.
Heating charges for tenants in 15 blocks, which include heating and, in some cases, hot water, are set to fully recover costs. However, this year all heating charges are recommended to decrease, with a 5.4 per cent reduction for tenants in blocks with electric heating.
Councillor Darren Sanders, cabinet member for housing and tackling homelessness, criticised the government’s policies, saying: “Our government says capping private sector rents discourages developers from building new homes, just like the Tories, yet they think it’s good to cap council rent rises. “We have to provide the services people want, let alone the new homes people need.
“For me, under the Tories it felt like councils had their hands tied behind their back—unfortunately this government has added weights to our feet and hope we float. “I’m sorry to be blunt about this but frankly this means less repairs for our tenants.”
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