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Caerphilly Council has agreed to a 6.5% rent increase for its tenants for the next financial year, in one of the first indications of the highest rent hikes for social tenants in decades.
The county council said in a release that the increase was in line with the maximum cap set under the Welsh government’s rent-setting policy for 2023-24, which was announced in November.
This will increase the current average rent by £6.10 per week, from £93.80 to £99.90.
Caerphilly Council estimated that 78% of tenants will not be affected by the increase as they are in receipt of housing benefit or Universal Credit.
Rent for council-owned garages in the county borough will increase by 5.5% to £8.85 per week.
Both decisions were taken after cabinet members considered many issues, including affordability for tenants and the impact of high inflation on service delivery.
Shayne Cook, cabinet member for housing at Caerphilly Council, said: “We currently have one of the lowest local authority rents in Wales and are committed to ensuring our rents remain affordable.
“While next year’s increase remains lower than inflation, we understand that any increase is a concern, particularly given the current cost of living crisis.
“The financial challenges facing us are unprecedented and if rents are not increased, this would result in a reduction in services and the need for even greater borrowing.
“Supporting our tenants and helping them sustain their occupation contracts is a key priority for us. We give tenants our assurance that we will not evict anyone because of financial hardship when they engage with us to seek support.”
He said this approach had resulted in no evictions in the previous year and highlighted that the council’s housing support service helped secure £3.2m in additional benefit income for tenants during 2021-22.
Mr Cook added: “I urge anyone who may be concerned about their finances to contact our housing support service to find out what advice and assistance is available.”
The announcement comes after a number of leading housing organisations in Wales warned in December that the government’s draft Budget amounts to a real-terms cut and could leave service delivery unaffordable.
Community Housing Cymru and Cymorth Cymru made the warning after the Welsh government described its Budget for 2023-24 as “one of the hardest since the start of devolution”.
While the Budget aimed to build on the spending plans set out in the three-year Budget outlined in March, it was lacking in new support for the housing sector in Wales.
Last year’s draft Budget, confirmed in March, revealed plans to spend £310m in Social Housing Grant in 2022-23, up from £250m in the previous year.
It also confirmed plans to spend £330m on Social Housing Grant in 2023-24 and £325m in 2024-25, as well as allocated £27.5m on homelessness prevention and housing support over the next three years.
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