Fife Council has unanimously approved its Housing Revenue Account (HRA) budget for 2016/17.

Rent for council tenants and charges for housing services, lock-ups, garage sites, launderettes, caretaking, heating, garden care and hostels will increase by 2.5 per cent in 2016-17.

This rent increase was supported by 52 per cent of people who responded to the tenants survey, and was also unanimously backed at the Annual Tenants’ Conference last October.

Councillor Judy Hamilton, executive spokesperson for housing & building services, said: “I am delighted the council has agreed to take forward the HRA budget and our housing plans for next year.

“Our rents are still below the Scottish average and the money we collect is used solely to benefit housing tenants.

“We’re developing our improvement plans together, through a programme of regular consultation and listening to tenants’ feedback. Tenants are now represented on the council’s scrutiny committee as well.

“The agreed rent increase will help us deliver improvements that people tell us are changing their lives. Our tenants want warmer, drier, healthier homes and we’re delivering that by investing in energy efficiency solutions - new windows and central heating systems – as well as new kitchens.

“Fife is still the highest investing local authority in Scotland, putting three quarters of our HRA back into the fabric of our housing stock. And we remain committed to delivering 2,700 new homes by 2017 to give more people access to good quality, affordable housing.”

John Mills, head of housing, also welcomed the outcome: “There was unanimous support from councillors for the HRA budget. This is particularly pleasing as it reflects the views of our tenants and will allow us to keep working towards better homes for them all.”

Overall, the council said reduced funding and increasing demand for its services has saw its budget gap reach £91 million in three years.

The budget for 2016-17 identifies savings worth £30.9m but £10.6m of this will be reinvested in services to help create a fairer, healthier Fife – which will also save public money in the long run.

Council leader David Ross said the sheer scale of the savings that need to be made and the short timescale the council had to respond to a revised situation had made it impossible to plan a sustainable budget.

“Like other councils, we didn’t expect such a large reduction in our government grant and, since December, we’ve had to very quickly find ways to save another £17m in the year ahead,” said Councillor Ross.

“As an administration we had planned to propose a council tax increase of 7.5 per cent. This would have cost most households in Fife between just 80p and £2.00 a week and given us over £7m to put towards local services. In public feedback, two out of three people said they supported this idea. However, the government attached new conditions to our funding package and would have withheld £25m from Fife services if we’d increased council tax, ruling out this option.

“The Scottish Government has allocated £16.8m extra funding for health and social care. So we have cut back our ongoing funding by 3.6 per cent or £5m, in line with the cut to the council’s grant funding, but we’ll re-invest £1.8m to account for growth.

“And we’re making other recurring savings, including £1.5m from the operational budget for nursery education, although £700,000 of this will be reinvested in early years services such as family nurture. This will build on our £7.8m investment in early years services which are proving successful in helping to close the educational attainment gap.

“To bridge the bigger than expected gap this year, we’ve identified over £13m from temporary savings. These are one-off cutbacks which will undoubtedly put strain on services and staff. These savings will give us some breathing space as we consider ways to transform services and spending on a permanent basis to meet the ongoing budget challenge.

“Temporary savings will include £2.7m from supplies and services, a £2m reduction in building maintenance and a £1.1m reduction in roads maintenance.

“No one wants to reduce funding for the upkeep of our roads. But it is an area where we can choose to do less, and so temporarily save money. However, in the year ahead we plan to undertake a full review of our roads service, in consultation with the public, councillors and professionals.”