On Air Alex in The Afternoon Alex Brindley | 3:00pm - 5:30pm

Rent rise of 2% for public sector homes

Increase to fund future investment - DoI

Rents for the Island's public sector housing tenants are to go up by 2% from April 2017.

The rise will mean an increase of just under £1.90 per week for a three bedroom house and £1.10 for a one bedroom flat.

The Department of Infrastructure says the increase is vital to fund  future capital projects - building and major refurbishments - and anything less would leave the department with a budget shortfall.

The cost of providing public sector housing outstrips rental income, with the difference, known as a housing deficiency payment, funded by the DoI.

The shortfall currently stands at £4.1 million (2016-17). Minister Ray Harmer says means-testing as a way to link tenants' income with the rents they're asked to pay, is still being considered by government - but is "a complex issue with much wider implications than housing."

He's confirmed all 15 local housing authorities in the Island were consulted about the rise - and says public sector rents remain significantly lower than the private sector equivalent.

The rise won't affect those whose rents are paid by social security benefits.

More from Isle of Man News