Regulator finds council overcharged tenants £4.2m

Councillor Geri Bird said the authority was working to put things right

A regulator has found that a council overcharged its tenants a total of £4.2m over a number of years.

The Regulator of Social Housing (RSH) said Cambridge City Council had "overcharged about half of its tenants as a result of errors that it has made in setting rents over a prolonged period".

The authority said in January that it had identified the mistakes and referred itself to the regulator.

The council apologised and said it was working out how much tenants were owed, and said it could take "some months" for refunds to be processed.

Two historic errors were identified by the council in how it had set its rent and service charges, according to the Local Democracy Reporting Service.

The first error related to a failure to apply a 1% reduction required for about 300 affordable rented properties between 2016/17 and 2019/20, and refunds will cost the council £1m.

The second mistake related to a 2004 policy that de-pooled service charges for gas and lift maintenance erroneously from rents, which the regulator said resulted in a "significant number of tenants" being overcharged in subsequent years, and refunds will equate to about £3.2m.

The regulator said the council had been "transparent" and was "engaging constructively".

'We are really sorry'

Kate Dodsworth, chief of regulatory engagement at RSH, said the issue needed to be addressed promptly.

Labour's Geri Bird, executive councillor for housing, said: "When we created the affordable rents policy, we could have set rents higher than we did without breaching government guidance, but because of misinterpreting the guidance we have unfortunately overcharged some tenants.

"We are really sorry and we’re working to put this right as soon as we can."

She said a small amount of tenants "might receive thousands of pounds" but "the majority won't".