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INCREASED COUNCIL HOUSING RENTS CAUSE INFLATION

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Higher council and housing association rents are leading to inflation, according to a new analysis for the Joseph R...
Higher council and housing association rents are leading to inflation, according to a new analysis for the Joseph Rowntree Foundation.

Geoff Meen of Oxford Economic Forecasting says rent rises are leading to losses for the Treasury.

About two thirds of the rent increases are claimed back by tenants in housing benefits. And because these rents are included in the calculation of the Retail Price Index, higher rents mean higher government payments for pensions and certain social security benefits.

The inflation generated by higher rents feeds into the wide economy and the wage bargaining system, says Mr Meen.

His analysis shows there are adverse financial effects from higher rents on public spending and the national economy and presents different reasons for government to reconsider its policies on higher rents.
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