London Tenants Federation calls for freeze on social rents

“A bigger and greatly improved stock of social rented housing will be worth it in the end, not only for the better health and living conditions of millions of people, but for the long-term value it will add to the nation’s housing stock,” she added. 

Ms Turnbull said social rent tenants have been faced with larger than normal increases over the past two years as a result of inflation. 

“These rent rises came at a time when social rent tenants, many of whom are on low incomes, were also faced with a general rise in the cost of living, in outgoings for food and energy. 

“So it is not surprising that there has been an increase in arrears, which faces landlords with loss of income and tenants with increasing debt and even the threat of eviction,” she said. 

She said the sector has been “neglected and underfunded for over 40 years, leading to the housing crisis we now find ourselves in”.

“Councils are approaching bankruptcy meeting the costs of housing homeless families in private rented accommodation, which does not meet the levels of security of tenure, nor often the standard or size of accommodation which these families need and should be able to expect. Government has also to pay out in welfare payments to meet these high private rents.”

The government consultation on the social rent settlement is ongoing. 

While the proposed five-year settlement has been welcomed by the sector, social landlords have said an “at least” 10-year settlement is needed to address the significant pressures they face. 

In response to the rent freeze call, Alistair Smyth, director of policy and research at the National Housing Federation, said: “Housing associations understand that any increase in costs will impact on residents. Many will offer significant support to tenants who may be struggling to pay their rent.

“Given that rents generate the majority of income for housing associations, striking the right balance between affordability for residents and the ability to invest sufficiently in homes and services now, and in the future, is always a priority.

“Successive rent cuts and caps over the last decade mean housing associations lost £3bn in income last year and today rents are 15% lower in real terms than in 2015. 

“These cuts, combined with the increased costs of meeting new regulations and making buildings safe, have severely impacted the sector’s financial stability and its ability to build new social housing at a time when these homes are needed more than ever.

“To rebuild the sector’s capacity, we need to see a package of supportive measures at the upcoming Spending Review, including long term certainly over rental income, equal access to building safety funding, and a big boost in funding for building new social rented homes.”

The Local Government Association (LGA) pointed to its response to the consultation, in which it argued for a 10-year settlement. 

It said: “We do not consider that five years is a sufficient length of time to provide the level of confidence and certainty needed.

“To really strengthen and provide stability to Housing Revenue Accounts (HRAs), a minimum 10-year rent settlement is needed, alongside restoration of the lost revenue due to the rent cap in 2023-24 and a review of the self-financing settlement of 2012.”

The LGA said 10-year settlement would provide councils “greater certainty” on rental income and support long-term business planning to “ensure they can deliver high-quality homes and associated support for their tenants”.

It described the proposed CPI plus 1% increase as “the absolute minimum required by councils”, adding an analysis from Savills “shows that while this will improve the national HRA projections, there will still be a deficit”. 

The LGA said it is therefore asking for the reintroduction of convergence of rents to formula rents for social housing tenants. 

“This should be in addition to the CPI plus 1% for a minimum of 10 years,” it said. 

The LGA said it is “also vital” that there is further government investment to “help respond to priorities” – from retrofit to building new council homes – to “avoid all the pressure falling on Housing Revenue Accounts and the residents whose rents and services charges fund them”. 

The Ministry of Housing, Communities and Local Government has been contacted for comment.