The 7.5% increase to public sector rents in the Isle of Man was ‘necessary’, according to the Chief Minister Alfred Cannan.

Speaking during Tuesday’s House of Keys sitting, Mr Cannan explained that the Council of Ministers agreed to the increase because of significantly high cost pressures for the Department of Infrastructure (DoI).

It was announced in January that islanders living in social housing will see their rents shoot up by 7.5% from April, a decision made by the DoI after consultation with the island’s 15 local housing authorities.

Minister for Infrastructure Tim Crookall said that ‘building materials, fees, labour and other expenses have all increased in price, and it’s vital that this is taken into consideration alongside concerns around affordability for tenants.’

When asked what discussions the Council of Ministers had held on the increased rent prices, Mr Cannan said: ‘I can advise that on December 21, 2023, the Council of Ministers noted a paper from the DoI regarding its decision.

‘Any charges that are applied in any form of public service is always concerning, but one has to obviously deal with the realities of the situation that departments are facing in terms of cost pressures.

‘I would also say that rent increases have been kept considerably low over the last five years - 2.1% in 2019-20, 1.9% in 2020-21, 1% in 2021-22, 2% in 2022-23 and 5% in 2023-24.

‘Between the 2022-23 and 2023-24 financial years, there’s been an increase of £321,338 in the DoI’s costs, which is a 30% rise. This is a large increase, and with rents going up by 7.5%, I think that’s a pretty fair formula to apply.’

Asked whether cost of living pressures were considered by the Council of Ministers when accepting the increase, Mr Cannan said: ‘Government budgeting needs to reflect this increase in pressure versus the need for the supply of services from the government.

‘I wouldn’t say that these charges are politicised at all, and I think they’re realistic and appropriate in the circumstances.

‘The value for money in public sector housing compared to that in the private sector is still extremely good and supportive of those on lower incomes.’

Help is available for tenants who find themselves struggling to meet their financial obligations.

In the first instance, they could contact their housing provider who may be able to assist them with a repayment plan.

Housing customers could also consider contacting the social security division within the Treasury to discuss alternative payment methods.