Rents for council homes in Hackney are set to go up by an average of £4 a week from April.

The move represents an increase of 4.1 per cent – the rate of consumer price inflation plus one per cent, which is the standard set by the Social Housing Regulator.

The council said rents will go up by £4.17 on average – from £103.42 per week to £107.59 – when the new financial year starts.

It said it had to increase rents and make savings to set a balanced budget, which it has to do by law.

The council said a lower increase would have forced it to make more savings and that would have affected services for tenants.

It had to find £2m savings from the housing revenue account between 2020 and 2023.

Between 2016 and 2020, government policy meant rents were cut by one per cent.

Cllr Clayeon McKenzie, the cabinet member for housing services, said Universal Credit and other benefits will cover the increase for many tenants.

However he said the economic impact of the pandemic has also brought “massive arrears”.

In 2020/21, the council made provision for an extra £1.5m in arrears from its homes and another £0.5m from commercial properties.

The number of people in council homes on Universal Credit doubled in the last year, with residents hit by job losses and cost of living increases amid the pandemic.

Cllr McKenzie added: “The pandemic has continued to impact on the budget for managing and maintaining council homes, with more tenants put into financial difficulty and struggling to pay their rent, higher costs from
providing additional support to those residents most in need, and less extra income from other sources such as hiring out community halls."

Most tenant service charges are staying the same for another year, but Cllr McKenzie said communal lighting and heating costs are going up because utility prices “have doubled in the last year”.

He said the council was “regretfully passing on” the increase, but pointed to Hackney’s rent being the seventh lowest in the capital.

The concierge charge is also going up because of increases in the London Living Wage and National Insurance increases.