Camden plans to raise council rents by 8% to cover subsidy cuts

A London borough plans to raise council rents by more than 8% from April to cover a shortfall in Government subsidy.

Camden Council is proposing to raise rents by 8.1% from April, following a £6 million reduction in Government subsidy, as part of the new “self financing” regime for council housing. 

The plans are subject to a cabinet decision on January 18.

Camden said that whilst the council is obliged to make up the shortfall in income for the next financial year - following the scrapping of the Housing Revenue Account (HRA) - in future years, the new system should provide the council with more resources.

This, it said, would give it far greater discretion and flexibility over rent increases, as there will be no further "grant clawback by the Government".  

Average rents after the increase will be £99 per week, which, it says, is below housing association rents and is around 25% of the level of private sector rents in Camden. 

Cllr Julian Fulbrook, Member for Housing, Camden Council, said: “It’s a shame that the Government is launching the new era of ‘self financing’ by effectively forcing the council to raise rents to balance the housing accounts. This increase is significantly higher than the Government’s 5.2% increase in the state pension and is not helpful for people already struggling to pay higher energy and household bills.

“The high rent increase is in stark contrast to the Government’s approach elsewhere where they have found extra resources to limit council tax increases, which perhaps highlights the relative priority that they give to less affluent residents in the borough.”