Social rents in properties owned by Wokingham Borough Council are set to go up by less than the maximum allowed by the Government to help residents through the cost of living crisis.
In its draft budget for 2023/24, the authority is proposing an increase of just 5.99 per cent even though the national cap, announced in the Chancellor's Autumn Statement last November, permits up to seven per cent in the coming financial year.
Fair balance to maintain sound finances
This is part of the council's ongoing efforts to strike a fair balance between maintaining sound finances, which is getting harder as it faces unprecedented running costs and inadequate Government funding, and supporting householders who are struggling the most.
Before the Government introduced the cap, the council was allowed to increase social rents by one per cent above the forecast consumer price index, which in 2023/24 would have been about 14 per cent.
Even if it were to raise rents by the full seven per cent, it would therefore receive less income that it did without the cap so would still face some added pressure on its finances.
Reducing the increase to 5.99 per cent brings less income still, but the council can sustain this. It is making careful savings which will continue to protect essential services like adults' and children's social care or anti-poverty initiatives.
The added challenges of a 5.99 per cent increase are not insurmountable, and the council recognises its value as residents are facing cost increases across the board - from groceries to fuel and energy bills.
Council tax reduction scheme
This is why it recently allocated an extra £100,000 towards its council tax reduction scheme, which helps eligible residents who are finding it hard to pay their bills. Despite this and other investments, it remains on track to deliver a balanced budget.
This comes as Wokingham Borough continues to receive the least Government funding per resident of any unitary council in the UK - totalling about £30 million below the national average. In this year's Local Government Finance Settlement, it will once again get less than other areas because it is perceived as having less deprivation.
However, the council believes this is unfair as it can't raise council tax to plug the funding gap and shouldn't have to delay projects or increase charges for its services. Its leader Cllr Clive Jones has written to ministers explaining the added pressures this will cause.
Keeping social housing well maintained
Cllr Stephen Conway, deputy leader and executive member for housing, said: "We know that increasing rents by any amount will never be popular during a cost of living crisis, but - as with so many areas - we have to compromise between recognising this and continuing to keep our social housing stock well-maintained and in good repair.
"Given the current pressures, we're pleased that we're set to accomplish this in 2023/24. Maintaining robust finances will allow us to continue helping those hit hardest by the tough conditions that everybody is facing, ourselves included.
"Those who are concerned by the news of the rent increase should know that help is still out there if you're struggling, both from us and the organisations we work closely with. We're still here for you if you need it, and you shouldn't feel afraid to come forward."
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