SFHA and Scottish Government reach agreement on rent

The Scottish Federation of Housing Associations (SFHA) has reached an agreement with the Scottish Government on expected rent increases for the next financial year. The announcement means its members will continue to keep rents affordable, and the Scottish Government anticipates there will be no restrictions on rent setting in the social housing sector from 1 April 2023.

The certainty provided by the agreement will allow SFHA’s members to plan new-build developments and improvement programmes for existing homes as well as continue delivering support services for tenants. It also protects the active and direct role of tenants in rent consultation with their landlord.

SFHA has also published a statement (1) today, supported by the Scottish Government, which underlines its longstanding history of working with the government to protect tenants and communities across Scotland. The statement, which comprises six principles with accompanying actions, sets out SFHA members’ dedication to supporting tenants through the cost of living crisis as well as the Scottish Government’s commitment to investment to enable this work.

Sally Thomas, SFHA Chief Executive, said:

“Housing associations are committed to supporting tenants through the cost of living crisis and work tirelessly every day to reduce poverty across Scotland. Today’s announcement will mean the sector can continue its work to set rents in an open and transparent way, involving tenants in decisions for the upcoming year and allowing the sector’s essential work to continue.

“A rent freeze could have removed more than £200 million of investment from new and existing homes in the social housing sector, and any restriction would have resulted in reductions in vital support services, with little difference to individual tenants’ incomes (2).

“We are pleased that Scottish Government has worked closely with the sector, to understand the evidence and avoid unintended consequences of this legislation, and to find a collaborative way forward. Investing in good quality, warm homes for social rent is crucial to tackling poverty in Scotland and protecting new and existing tenants from the increasing cost of living.”

Ends 

Notes to editors:

1. Written answer: “Given the voluntary agreements reached we anticipate that the first statutory report on the Cost of Living (Tenant Protection) Act 2022, due by 14 January, will formally confirm our intentions to expire the social rented sector rent cap provisions from March 2023.” https://www.parliament.scot/chamber-and-committees/questions-and-answers/question?ref=S6W-13389
2. Scottish Government and Housing Associations’ Statement of Intent 2023/24
3. Around 70% of social housing tenants have their rents covered by social security, paid in part or fully by the UK Government, and the Scottish Housing Regulator estimated that those tenants who do pay full rent would save around £3 per week from a rent freeze.