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Council house rents will increase by 1.5% in 2021/22, Caerphilly County Borough Council’s cabinet has agreed.

This will see the average weekly rent for council house tenants go up by £1.36 – equalling £92.02 a year.

A council report says this is the lowest increase “for a number of years” – with the average across the last seven being 3.33%.

Between 2020/21 and 2024/25, councils in Wales can only increase their rents by the CPI inflation rate plus 1%. CPI (consumer price index) is measured based on the average value of a shopping basket.

As the inflation rate in September was 0.5%, 1.5% was the maximum increase the council was allowed.

Council rents go towards the council’s housing revenue account (HRA), which manages the council’s housing stock.

The council had budgeted for a 2.5% increase in its business plan and the reduction to 1.5% will reduce the housing revenue account’s income by £500,000.

The report says: “Inflationary increases on providing all aspects of the housing service are experienced annually, however as the HRA cannot legitimately set a deficit budget, the loss of additional income will result in reduced resources being available to effectively manage and maintain the stock, or result in increased levels of borrowing.”

Rent on council-owned garages will also increase by 1.5% for the next financial year. Unlike council homes, these rents have not been increased for three years.

Currently the council charges £8.11 a week, but 75% of garage tenants are not council tenants.

For council tenants the new weekly garage charge will be £8.23 and for non-council tenants it will be £9.88.