Fears over Norwich council rent hikes
The impact of the government's spending cuts on Norwich was today laid bare.
Among the hardest hit could be thousands of Norwich families, who face “horrendous” rises in the rent they have to pay to live in council homes.
However, there was some good news for Norfolk after funding to complete the dualling of the A11 was confirmed.
The announcements were made as part of Chancellor George Osborne’s comprehensive spending assessment.
Council house tenants have been warned they face big increases after Mr Osborne announced yesterday that new tenants would have to pay rents at about 80pc of the market rate.
City councillors warned that would lead to real financial hardship for many families in Norwich – where the council is landlord of about 17,000 council homes. They said the average rent paid by those tenants was £60 a week, but under government proposals unveiled in the comprehensive spending assessment, they could have to pay more than £80 a week for a one-bedroom flat and just over £200 a week for a four-bedroom house.
Brenda Arthur, the Labour-run city council’s cabinet member for housing and deputy city council leader, today said: “I think this is just horrendous.
“Our average rent for council homes is £60 a week and this is talking about new tenants being offered rents at 80pc the market rent.
“It will make it really hard for people to find that extra money and there’s a fear that if the changes in tenancies goes ahead then people will not even be secure in their homes.
“The thought of having to pay extra rent with the benefit cuts will see an awful lot of people in Norwich struggling. We are really, really concerned about this.
“We are being told this is the start of the consultation and, rest assured, as a council we will have plenty to say about this.”
She said private rent on a one bedroom property was £103 a week, up to £254 a week for a four bedroom house, so at 80pc of that value would see a big hike on the average council rent of £60 a week. Mr Osborne made clear terms for existing tenants would remain unchanged, but Ms Arthur said: “It will impact on them because in many cases it will be other members of their family such as their children who will be affected.
“We are told the government wants to devolve power so that local communities have more say and I’m sure the government would get the message from local people that they do not want to see council rents hiked.”
Mr Osborne said the current social housing system was “failing to address the needs of the country”, with more than half a million social rented properties lost and waiting lists shooting up.
He said: “While a generation ago only one in 10 families in social housing had no-one working, this had risen to one in three by 2008/9.
“We will ensure that, in future, social tenants and their rent levels will remain unchanged and new tenants will be offered intermediate rents at around 80pc of the market rent.
Mr Osborne said £4.4bn would be handed to councils to build up to 150,000 affordable homes in the next four years and the Decent Homes programme would continue to provide cash to improve the existing stock.
He added there was a £6bn commitment to the Supporting People programme, which gives vulnerable people help with housing costs.
And he said councils would get more freedom on how to spend their cash, by removing ringfencing of local government revenue grants.
But Ms Arthur said: “The solution is for the government to be building new homes. In Norwich we need 677 new affordable homes every year to keep up with demand and we haven’t been able to deliver that over the last few years.
“Optimism over us being able to use the housing revenue account rule changes to build houses rests in the detail, which we still don’t know.
“There is not much joined up thinking here and it seems the cuts are being aimed at the most vulnerable.”
Michael Newey, chief executive of Broadland Housing Association, said: “It means we will be charging our tenants higher rents to build more houses, but you can see the logic of it in an environment where there is not enough money.”
Campbell Robb, chief executive of Shelter, said: “The combined worry of cuts to housing benefit and the slashing of the affordable house building subsidy, coupled with the absence of a long-term strategy, will be devastating for the housing aspirations of thousands of young people consigned to increasing costs and bringing up their families in an insecure private rented sector.”
A Communities and Local Government spokesman said: “There is a huge waiting list for social homes and, given the huge pressures on the public finances, we need to find ways of making limited public investment go further.”
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