Question to the Ministry of Housing, Communities and Local Government:

To ask the Secretary of State for Housing, Communities and Local Government, what assessment she has made of the potential impact of (a) trends in the level of local authority borrowing costs and (b) rent-setting policies on the ability of local councils to build and maintain housing stock.

The government recognises that access to low-cost borrowing and the certainty provided by a long-term rent settlement are essential to the ability of local authorities to build and maintain housing stock. To this end, the government is helping local authorities borrow more cheaply from the Public Works Loan Board until the end of 2025-26.

Local authorities are responsible for their own capital strategies and have wide freedoms to use borrowing to support local investment. Under the current framework, they must ensure borrowing is prudent, affordable, and sustainable.

The government recently consulted on a long-term rent settlement that would allow social housing rents to increase above inflation (by up to CPI + 1%) each year for five years from 2026. The consultation closed on 23 December and my officials and I are giving careful consideration to all the responses received. The government will issue its response to the consultation in due course.