Council house rents for city tenants are to go up by more than double the rate of inflation in April, it has been revealed.

The ruling Labour group on Oxford City Council agreed the average rent should go up by £3.10 to £48.10 - an increase of 6.9 per cent.

This would allow them to spend £3.5m on repairs andimprovements to council houses.

But Liberal Democrats said it would put more people in the poverty trap and proposed an alternative budget which would see rents fall by £2.20 instead.

Susan Brown, Labour's vice-chairman of the housing committee, said: "We have had to make some savings this year but we are also putting a large amount of money into improving the housing stock.

"Obviously, tenants are never going to look forward to a rent increase, but I think they can be satisfied that this rent increase is value for money."

City councillors were originally asked to put up rents by ten per cent to make up a £1.6m overspend on the housing budget.

The 6.9 per cent increase follows negotiations with tenants and alternative measures to save cash, such as transferring £300,000 from profits made by the council's city works department.

The Liberal Democrat group proposed using more than £2m of Government loans, set aside for capital housing projects, to prevent the rent rise. Housing spokesman David Connett said: "This rent increase will just put more people into the poverty trap."

Ms Mary-Jane Sareva, chairman of Oxford Federation of Housing Associations, said the worst hit would be people just above the threshold for housing benefit.

Story date: Tuesday 23 February

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