Councillors in Dundee have voted to increase rent for council tenants by at least 3% despite concerns the move will heap more misery on people already struggling.
The rise will come into effect on April 1 after the council’s neighbourhood services committee voted marginally in favour by 14-13 on Monday.
The exact rate of increase is still to be decided but three options will be put to tenants in a public consultation. These are:
- 3% increase with a maximum rise of £2.41 per week.
- 3.25% increase with a maximum rise of £2.62 per week
- 3.5% increase with a maximum rise of £2.82 per week
Increase will hit after rent freeze ends
It will come into effect just after a Scotland-wide rent freeze, introduced recently by the Scottish Government, ends on March 31.
Labour councillor for Broughty Ferry, Pete Shears, put forward an amendment against any rise if the nationwide freeze ends as expected.
SNP majority representatives on the council however said a rent rise is needed to meet tenants’ repair needs and expectations and that without one, a future increase could be double.
The cause of the proposed hike, according to council documents, is a £1.56 million hole in the annual Provisional Housing Revenue Budget.
Mr Shears was supported by Liberal Democrat councillors and other Labour members.
The Labour amendment proposed using £1.6 million from the council’s renewal and repair fund which currently stands at £9.86 million.
Mr Shears said: “We are living in the most volatile times that any of us can remember. Food prices, inflation, energy prices – all at record levels.
“Three pounds a week doesn’t seem a lot, but when you’re budgeting for every single penny, it can make a huge difference.
“To those who need it the most, it will make a difference.”
Mr Shears continued: “There doesn’t need to be a denigration of services, repairs or maintenance.
“It’s a one-off extraordinary move in what are extraordinary times.”
‘Convener of the committee, SNP councillor for Coldside, Heather Anderson, said: “There will be an expected deficit of £1.563 million…
“This deficit can only be met by applying a rent increase of 3%, which is considerably lower than the current rates of inflation.”
It’s a one-off extraordinary move in what are extraordinary times.
Councillor Pete Shears
Ms Anderson continued: “(This) would allow services to continue investing in areas that tenants have highlighted as their priorities.
“These include: energy efficiency schemes, help to sustain their tenancies and increase the supply of affordable housing.”
‘It will make a difference’
Responding to Mr Shears’ amendment, Heather Anderson said: “We investigated all the options…we decided the 3% increase would ensure that we could carry on with the work that we’re doing, work that tenants are asking us to do.
To offset some of the impact of the rise it was agreed to double a hardship fund from £500 thousand to £1 million. But the logic of doing this was tested by another councillor after Heather Anderson spoke on the matter.
Ms Anderson said: “(It would) also ensure that the 26% of tenants who pay their rents from private means are not disadvantaged. So, that’s why there’s a proposal to double the hardship fund.”
‘Something slightly perverse’
Liberal Democrat group leader, Baillie Fraser Macpherson responded:
He said: “I hear what you say about the hardship fund and that’s welcome.
“But…we would be increasing rents, to help increase a fund, to help mitigate the effects of the rent increase that we’ll have just imposed on our tenants.
“There’s something slightly perverse about that.”
‘Store problem for next year’
SNP council leader, Councillor John Alexander said: “All we do is store up a problem for the next year. So, instead of £1.6 million this year and then it disappears because we’ve done it for one year, it’s a recurring cost.
“That means, £1.6 million pops back up next year…so we could very much be looking at a 6% rent increase, if what we do, is freeze rents this year.”
