Council tenants to see rise in bills due to hike in cost of energy

The proposal to increase prices for tenants on scheme from next month was approved solely by the vote of the chair of the council’s housing policy committee as all the other seven members present abstained.

Committee chair Coun Douglas Johnson, council Green Party group leader, said: “We’re grappling with massive budget issues. This is the first of a number of uncomfortable budgeting decisions we’re going to be making.”

The council is forecasting overspending of its overall budget totalling £19 million. The housing repairs service faces cuts of £5 million this year.

The committee heard that the the council’s strategy and resources committee has set a target to make savings from the Housing General Fund of £723,000 (16 per cent), out of a budget for 2023/24 of £4.4m.

A decision will be made on this at the committee’s November meeting.

A report to the committee said that, because of months of uncertainty over energy prices, a predicted increase of 37% that was agreed actually stands at 107%.

The report said that if charges to tenants are not increased, the community heating account could face a shortfall of more than £1 million at the end of the financial year, which would need to be subsidised by the housing revenue account.

The increased costs would then be passed on to other council tenants.

The committee was asked to approve that the charge per killowatt hour increases from 5.69p to 12p.

The district heating scheme provides heat to city households and public buildings by burning waste that cannot be recycled at the Bernard Road incinerator operated by waste contractor Veolia. This is piped through from large public boilers, rather than the individual ones found in most homes.

Veolia sell the electricity generated by the process to the National Grid.

Housing department service manager Fiona Orr told the committee that a mid-year increase has never been proposed before.

Coun Fran Belbin, Labour member for Firth Park ward, said that she was told by fuel poverty umbrella group Sheffield Energy Network that many people using the scheme are vunerable tenants who are already paying quite high energy bills.

She asked: “Is there any benefit to those tenants being on the district heating scheme?”

Director of housing services Janet Sharpe said: “It is a ring-fenced account that can help stabilise payments during the year. It is normally clear what people pay throughout the year.

“That is not the case for people who have individual boilers at the moment.”

Committee deputy chair Penny Baker (LibDem, Stannington) said: “As members we are very concerned about this and not very happy. Can we have clarity about what would happen if we didn’t support this?”

Coun Johnson said: “Either they will have to pay or, if not, other tenants will have to pay it for them. It’s the very difficult first step of the very difficult budget decisions we are going to have to make.”

Coun Baker suggested deferring the decision to November but Janet Sharpe said housing staff want to prepare tenants for the rise and tell them what help they can access.

She said it was better to do that before the cold winter months.