Council house rents in Northumberland will still rise by seven per cent despite £20 million of Government funding.
Northumberland County Council's Conservative administration said a council rent hike was necessary as it was the only way to provide the current levels of maintenance as well as future affordable homes.
But opposition councillors said the decision could no longer be justified after the local authority was given a £20m levelling up package for Blyth, with £18m being used to boost housing.
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Northumberland Labour Leader Scott Dickinson MBE said: “At the council meeting the case was made that a seven per cent council house rent rise and a 11.1% maintenance rise was to repair the council housing stock, yet the day after nearly half of the £20m funding is set to be awarded to repair housing.
"How can the seven per cent now be justified, and given that quotes had gone to print prior why was it not explained to councillors that external funding had been allocated so further debate could have had the full facts?
"Levelling the repairs on the least able to afford through huge rent rises, many will be left scratching their heads not only how to afford the rise but why such a dramatic one is needed."
But a Northumberland County Council spokesman said the decision to increase council house rents is still going ahead.
He added: "It is required to ensure that the council is able to manage, maintain and improve its housing stock.
"We do however recognise that at this time, due to increases in the cost of living, some of our tenants, who are unable to access benefits to help with their housing costs, may experience some financial difficulties and for this reason, we have established a £350k Hardship Fund to help those tenants with their rent who may be impacted by the increase.
"Through the council’s £45million affordable housing programme we are also working to deliver new housing, by working in partnership with other housing providers, to meet the needs of our communities.
“The recently announced government funding for Blyth is to be used to support new housing led regeneration schemes which will be specifically targeted to address energy efficiency improvements and conversion of commercial units to provide additional residential accommodation.
"It will also be used to deliver new housing to support independent supported living and extra care facilities within the town.”
Also included in the multimillion pound Government funding is £1.5m going towards employment support, with new training equipment at Blyth's Energy Central Campus.
There are plans to tackle crime too, with £200,000 set aside to extend CCTV provision in the town centre and establish a new partnership between local businesses and the police, aimed at targeting anti-social behaviour, substance misuse and theft in particular.
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