A 3.1 per cent reduction in rents for Lambeth Council tenants was announced yesterday.

Tenants - who are still faced with the biggest rent increase in the country of 13.9 per cent - will have £2.12 shaved off the average weekly rent increase of £12.

The Government decision to subsidise the rents comes after months of lobbying from the council, as well as the borough’s three MPs - for Lambeth to qualify for the same reduction offered to other councils earlier this year.

Lambeth did not originally qualify because its original increase was so high.

The council have promised tenants - who have been paying the massive rent increase since April - the reduction will be implemented as soon as possible.

It also said it will continue to lobby for further reductions - which could be provided by a one-off payment of £11m, or permission to release capital funds.

But tenants furious at the rent increase, as well as job cuts in Lambeth housing, and the the sell-off of council houses are still planning to protest at the town hall this Saturday.

Labour Council leader Steve Reed, blamed the previous Lib Dem and Conservative administration for the rent increase.

He said when it was voted out in 2006, it left behind out of control running costs, as well as £3m lost through fraud, an £8m overspend and £11m of possible Government subsidy that they did not claim.

Lib Dem housing spokesman Jeremy Clyne said blaming the previous administration was both pathetic and dishonest after three years in which Labour have managed to bring the housing department to its knees.

He said: "Coun Reed cannot deny that we handed over a Housing Revenue Account that was in balance, he has created the £10 million black hole out of nothing."

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