Agenda item

To submit a report by the Head of Housing Services.

Councillor Alun Mummery, Portfolio Member for Housing and Supporting Communities presented the report by the Head of Housing Services which sought the Executive’s approval for rent and service charges increases for 2022/23.

In recognising that it was difficult to be proposing a rent increase in the current economic climate the Portfolio Member highlighted that all local authorities as instructed by the Welsh Government are required to implement the Rent Policy. Rejecting this policy would ultimately mean a loss of income for the Authority and inevitably affect the services provided.  Rejecting the policy could also jeopardise the annual Major Repairs Allowance of £2.66m received from Welsh Government as it could be seen that the Authority is not maximising its income generation opportunities.

The Head of Housing Services confirmed that on the 29 December, 2021 a letter was received from the Welsh Government confirming that as the Consumer Price Index for September 2021 falls outside the range of 0% to 3%, the Minister for Housing would determine the appropriate change for Social Housing Rents for 2022/23. The Minister has determined that all local authorities should use the CPI only with the value of the CPI in September being 3.1%. The Welsh Government has again decided to suspend the Target Rent Bands for 2022/23 and the overall increase of 3.1% would generate approximately £574k of additional rental income for the Authority. The Head of Housing Services clarified how the annual rent increase would be applied to ensure fairness and equality amongst tenants without exceeding the annual increase threshold whilst continuing to work towards achieving rent convergence with other social housing providers as outlined under paragraph 2.4 of the report. For tenants who might face financial hardship as a result of the increase in their weekly rent cost, the Service’s Financial Inclusion Officers are available to provide information, advice and support. It should also be noted that the 2,765 Council tenants who are currently in receipt of full or part Housing Benefit or Universal Credit will face no additional hardship as a result of the proposed rent and service charges increase.

In response to a question about the implications of not implementing the proposed rent increase, the Head of Housing Services advised that the level of rent increase is being used as the base model for the Housing Business Plan. If this method is not followed, alternative methods may be required to finance the business plan. Also the Authority is expected to maintain its housing stock to the Welsh Quality Housing Standard (which it achieved in 2012) on an ongoing basis and receives a major repairs allowance from Welsh Government to help with its council houses. Not implementing the rent increase could raise questions about the Authority’s need for this extra allowance. The Authority is also working toward the decarbonisation of its housing stock  by 2030 which makes the generation of additional rent income all the more important.

The Director of Function (Resources)/Section 151 Officer advised that the rent increase formula applies in the same way to other social housing providers  as it does to local authorities with housing stock and that not implementing the rent increase would therefore widen the gap between the Council’s rent levels and those of other social housing providers on Anglesey.

It was resolved to approve the following –

·         The rent increase in line with the Welsh Government rent policy on collection over 51 weeks.

·         That all rents below current target rent bands be increased by 2.25% +£2.00 per week to continue working towards rent convergence.

·         That all rents on target be increased by 2.25%.

·         That the rent for the 226 properties that are above target rent should remain at their current level.

·         An increase of 27p per week for the rent of all garages.

·         That the service charges set out in section 3.3 of the report be applied to all tenants who receive the relevant services.