The fight against a high rise in rents

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Police in Middle Street, Portsmouth, over the weekend.

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Tenants in social and council housing could end up paying more rent under new rules being brought in by the government.

But councils in the News region say they will oppose the plan, with one councillor branding it unacceptable to put the level of rent potentially out of people's reach.

The government has announced a series of measures designed to raise more cash from social housing, and attempt to 'break the cycle' of people staying in subsidised, low-cost council houses.

It hopes to introduce laws allowing local authorities and housing associations – the only providers of homes at discounted rents – to raise the amount they charge to 80 per cent of private rental charges.

The rents would be raised only for new tenants. At the moment they are less than half the amount charged by private landlords.

But Councillor Steven Wylie, Portsmouth City Council's leader for housing, said: 'We won't raise prices to that level. It's just not affordable for people and we don't think it's an acceptable thing to do. At the moment, these measures are government guidelines and we oppose them. Our job is to provide affordable homes for people who need them, and we can't do that if we or housing associations are charging 80 per cent of market rates.'

The government hopes the increase in charges will enable associations to build new homes, and help ease council housing waiting lists.

In Portsmouth, where there are 15,000 households in social housing – and a further 5,000 in Havant, where properties are run by Portsmouth City Council – there is a waiting list of 2,750 people hoping for a home.

Rents for a two-bedroomed council home are 70 a week, compared to 88 a week for housing association properties and 144 for a similar privately-rented house.

If raised to 80 per cent, council tenants would have to pay 45.20 more, while those living in housing association houses would be charged 27.20 more per week.

Peter Pennekett, Portsmouth City Council's finance manager for health, housing and social care, said: 'We have to make sure we don't price people out, so I'm in agreement about not having an 80 per cent increase. It could be very difficult indeed for the city if housing associations started increasing their rents by that amount, as there is a lack of housing across the city, and the private market is slow in terms of sales.

'It could see people pushed out of the market and in that case we'd have a duty to find them somewhere they could afford.'

Fareham Borough Council has 1,151 people living in social housing, and 2,434 occupied council houses. It has a waiting list of 2,200 people.

Council leader Sean Woodward said: 'We hope we can encourage private owners to offer properties to reduce numbers, and we are looking at all options, including rent increases, to help us build more properties through housing associations.'

In Gosport, where there are 3,222 council houses and 2,768 housing association-owned properties, Tory council leader Cllr Mark Hook said: 'We won't raise rents in the way housing associations can, but prices must go up in the next year. We're looking at a 6.8 per cent raise on our current two-bedroomed charge of 62.40 a week.'

The government also plans to encourage councils to offer two-year leases on properties, instead of the standard practice of an 'indefinite lease'.

But Cllr Wylie said: 'We've been working hard to improve cleanliness, and reduce graffiti and litter. These are places where people live and they can all see the benefits of their community being improved. So we oppose the introduction of two-year leases, because if people are there in the short-term before having to move on, they won't be a community. They will be people passing by while neighbours move on.

'It will break the community feeling and if people don't have a long-term investment in properties, they won't be prepared to invest as much care and time in keeping homes and surrounding areas at a good standard, because these won't feel like anything other than a temporary stop-over.'


Alongside measures to cut housing benefits, and reduce tenancies, the government has also asked councils to take on 'nominal debt' – a request Portsmouth City Council's lead councillor for housing, Cllr Steven Wylie, describes as 'theft from the city'.

The government wants all councils to shoulder the burden of debt some local authorities have run up building social and council homes over the past three decades.

Although Cllr Wylie admits Portsmouth will be better off than at present, he said the measures are still a penalty for the city as it does not have any debt at the moment.

Cllr Wylie said: 'Portsmouth City Council has managed its housing very well, and we don't have any debt at all. It's not reasonable for the government to tell us we have to hand it cash every year. It's like someone coming to your door with a massive credit card bill and saying you have to pay a share of it because you live on the same road as him. Taking this money is theft from the city.'

The proposed system, which would see the council take on roughly 60m of debt, to be paid back in yearly instalments, would replace the current scheme, under which the council pays the government 75 per cent of all rents it makes per year.

Under the current system, that money is redistributed to councils which are in dire need of new funding. The council has lost money every year this way.

The government also proposes allowing councils to keep all the money they make from their legal obligation to sell council properties to people who qualify for the 'right to buy'. That part of the policy could make Portsmouth City Council up to 2m per year.

Peter Pennekett, the council's finance manager for health, housing and social care, said: 'The change from the system in which we 'pay in' to government, to one where we have to pay off the 'nominal debt' could leave us better off.

'We estimate it could make us 2.5m in the first year, and that may rise to 60m over a 10-year period. We hope we can do it, though it is a shame, because we would be able to use all the money we made from rents for ourselves if we hadn't been tied into the nominal debt.'

Cllr Wylie added: 'We have a desperate need for new housing, but we also have to remember people already in our homes need a decent standard of living. We need some money to deliver these services and that's why the nominal debt's so frustrating. We are told the government wants us to be more local, but they're stepping in and taking money back.'