Council approves housing revenue budget

Aberdeen City councillors today (Thursday 12 December) approved its housing revenue and capital budget for the forthcoming financial year 2025/26.

Council rents are to increase by 7.5% in 2025/26 to help generate funds to help maintain and modernise the city's housing stock.

At today's meeting of the Full Council it was also agreed to continue with the Rent Assistance Fund, with an increase to the Fund to a maximum of £1m, which was launched last year and directly supported more than 150 tenants at risk of escalating arrears.

A report from officers had recommended raising rents by 12% to balance the Housing Revenue Account (HRA). However, Councillors instead agree to draw on reserves and take other measures to ease the ask being made of tenants.

Councillor Miranda Radley, convener of the Housing, Communities and Public Protection Committee, said: "Aberdeen City Council is investing in our existing housing stock, and driving forward investment in the new build programmes at Cloverhill, Craighill and Kincorth.

"This budget comes during incredibly challenging times, and we have allocated up to £1 million to a rent assistance fund, to protect our tenants who are struggling through this cost-of-living crisis.

"There are significant challenges our Housing Revenue Account faces, with the impact of rising cost of construction and repairs, made worse by the Employer National Insurance contribution by the UK Government, but we are continuing to deliver high quality homes and investment for our tenants."

Council Co-leader, Councillor Ian Yuill, said: "For the last four years, rents in Aberdeen have increased by an average of just over 2% a year, the lowest of all Scottish local authority landlords."

Included within the budget is £70 million of investment required to maintain the Council's stock to Scottish Housing Quality Standards. This spend includes a range of Health and Safety works, bathroom and kitchen replacement, energy efficiency works including window and door replacement along with roof and structural repair works. A further £55 million is allocated for new build projects, community initiates and specialist property adaptations to help people remain in their properties.

Last year, 42% of income went on repairs and maintenance - on simply meeting acceptable accommodation standards in a housing stock which is ageing and will require more investment going forward.

Housing sector costs have increased significantly in recent years due to construction costs inflation, borrowing charges, and ever improving environmental standards.

The HRA budget has also come under acute pressure from an increase in Employers National Insurance, introduced in October.