FIFE Council tenants will have to pay, on average, an extra £3.92 a week from April after a five per cent rent rise was agreed.
The same increase will apply to service charges, garages, lock-ups and temporary accommodation, as well as council tax, with the Labour administration admitting they can't afford to improve homes and build new properties without putting the prices up.
In a survey, tenants already struggling with the cost of living crisis told the council they wanted a rent freeze but "spiralling inflation" has left a £10 million-plus hole in the council's finances.
The average rent is set to go up by more than £200 a year and housing spokesperson, Councillor Judy Hamilton, said: “I know the idea of any rent increase is challenging, especially now.
"For the first time in a long time, when we consulted with tenants last year, we consulted on two subjects – the rent increase and the priorities for housing.
"A slight majority of respondents said they’d prefer a freeze over a small increase.
"Unfortunately, since that consultation happened, spiralling inflation rates have seen the projected pressure on the housing account increase from £6.6m to £10.2m.
"We simply can’t deliver the tenants’ priorities, continue with home improvements and house building without a rent increase.
"I have met with the tenants’ federations to discuss the challenges and they support an increase to avoid reductions in critical services."
The five per cent increase for 2023-24 will take the average rent up to £82.41 a week, which she said was still "well below" the Fife Living Rent threshold of £106.12 a week.
Cllr Hamilton continued: “Around two thirds of tenants have their rent paid through housing benefit or Universal Credit, so much of the income we generate from higher rents will come directly from HM Treasury rather than Fifers’ pockets.
“And this year, I am setting aside £1.5m to support tenants struggling with rent payments or those just moving to Universal Credit.
"And an additional £500,000 to support tenants in fuel poverty."
Faced with a Housing Revenue Account (HRA) budget gap of £8.3m, Labour said the rent rise would bring in income of just over £6.4m and that cutting the Capital Financing from Current Revenue (CFCR) budget by more than £1.8m would balance the books.
The SNP had tabled a motion proposing a three per cent increase, bringing in £3.9m from rent and closing the remaining gap by reducing the CFCR budget by £4.4m, but this was defeated.
Cllr Hamilton concluded: "There is no doubt in my mind that good quality housing provides not just shelter, but also essential security for families.
"We have to be able to maintain existing services, reduce the number of households in fuel poverty, invest in our housing and continue to build in a climate emergency and a fuel-poverty emergency.
"I thank all our tenants for the way they engage with us and support the council’s housing service."
For housing help you can call 03451 55 00 44 or go to www.fife.gov.uk/rent
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