Wandsworth Council is considering an additional annual rent increase for council tenants whose rents sit below the government’s formula-rent target. The proposal would start in April 2027, adding up to £1 a week to affected rents, then allow an extra £2 a week in each following year until each home reaches its target.
The increase would sit on top of the ordinary annual rent adjustment, which is currently capped at consumer price inflation plus one per cent. It would apply only to social-rent homes below formula rent, not automatically to every council tenancy. The target is calculated using factors including the home’s number of bedrooms and relative property value.
Wandsworth’s model identifies 9,969 of about 16,550 existing tenancies as below the target and therefore potentially affected if the council uses the maximum permitted increases. That is roughly six in ten council homes. The rent policy remains a proposal: the council’s financial plan assumes the maximum, but the decision to use the additional power would still be made through its annual rent-setting process.
The catch-up period would differ from home to home. The council’s rent-gap analysis estimates that 6,092 affected homes would take at least six years to reach formula rent under the proposed schedule. Tenants whose current rents are furthest below the target could therefore face the additional element for longer, while those with a smaller gap would stop receiving convergence increases sooner.
Who would feel the increase directly?
Housing Benefit or the housing-cost element of Universal Credit is recorded or believed to cover rent for 6,819 affected households, around 68 per cent. Eligible housing costs would normally rise alongside rent, although the amount covered depends on each household’s entitlement and circumstances.
A further 3,160 households, about 32 per cent of those affected, are not believed to receive housing-related benefits and may have to meet the extra charge themselves. The council’s assessment says its current information does not establish whether those tenants can afford the increase. Universal Credit data is not complete: the benefit is normally paid to tenants, and the council does not hold definitive, current records of every recipient or their entitlement.
The impact assessment also flags that older tenants are more heavily represented among homes below formula rent and may remain below the target for longer. It identifies older people on fixed incomes, disabled tenants and carers as groups that could have less room in their budgets. Disability information is incomplete, so the recorded figures cannot rule out effects that are not captured in the data. Planned safeguards include rent notifications, benefits advice and support for tenants who encounter difficulty.
The council’s Housing Revenue Account, the ring-fenced budget for its housing service, faces pressure from building-safety work, damp and mould, repairs, inflation and regulatory requirements. Its reserves closed the last financial year at £165.97 million, below the level previously expected. The business plan estimates that using rent convergence would add about £500,000 in 2027/28 and a further £1 million in 2028/29, with roughly £37 million added by 2036/37. That extra income is intended to support investment in existing homes and reduce reliance on borrowing.
Decision due in October
The Borough Residents’ Forum, which brings tenant representatives together with the council, considered the proposal on 30 September. The Housing Overview and Scrutiny Committee is due to review the housing-account business plan in public at Wandsworth Town Hall on 1 October. Cabinet is scheduled to consider the revised rent policy on 12 October.
A Cabinet decision to adopt the policy would not, by itself, settle any tenant’s rent or guarantee that the maximum is used in every year. The council would still set rents annually. April 2027 is the earliest point at which an additional convergence increase could appear, and the applicable amount would depend on the home’s remaining gap to formula rent.
For tenants, the immediate question is therefore not whether a new bill has already been approved, but whether the council will adopt the framework and later use its full discretion. The scrutiny stage comes before Cabinet’s decision, while the council’s own assessment leaves a central affordability question unanswered for the households expected to pay the extra themselves.
