The rises will apply to tenants in rented and shared ownership properties with the scale of added costs determined by government guidance which allows housing providers to put up affordable rents by the same rate as the consumer price index (CPI), the price of goods and services, plus one per cent.
For those in shared ownership properties the rise is linked to the retail price index (RPI), which measures the cost of living and rises in wages, plus one per cent.
In either case, increases will only be applied if the new bill remains 20 per cent or more below the market rate for the area. Eligible tenants must still be able to have rent costs covered by benefits.
Councillor Sean Woodcock (Lab, Banbury Ruscote) argued it was “not the appropriate time” to be adding to bills, particularly with the cost of living expected to shoot up.
“Inflation is predicted to be five per cent next year, we have the removal of the Universal Credit uplift, proposed tax changes for people at the lower end of the income scale, many of whom will be in these council-owned properties,” he said.
“People are already set to be hit by a council tax increase and now we want to take more money. I would ask that the political leadership of the council reconsiders this.”
Robert Jolley, assistant director of growth and economy at Cherwell District Council, argued the move was necessary.
“Such a policy is perhaps long overdue for this council,” he said.
“It is actually prudent business practice for the council to have such a procedure in place. This is bringing in some good housekeeping as well as anything else.
“It is also up to the administration whether they want to implement such an increase on a year-by-year basis.
“We need to bring this back in line, I do hear what Councillor Woodcock has said but I think this is the right thing to do.”
Councillor Barry Wood (Con, Fringford & Heyfords), leader of the council, said: “The political leadership of the council has thought long and hard about this, it is not an off-the-cuff recommendation.
“Our view is that the wording in the recommendation is particularly important... in line with government guidance, considering the need to ensure that rents remain affordable using the two measures of Local Housing Allowance and comparable data for the district.
“We are not operating in our own little world, we are seeking to make this fit with the rest of the market.
“There is a benefit to do a little bit annually rather than hold back and then face having to contemplate a larger increase at some point in the future.”
The increases were passed by the council’s executive.