Council to refund hundreds of overcharged tenants

Hundreds of social housing tenants in Mid Devon could receive compensation - on top of refunds - after overpaying rent.

Mid Devon District Council previously said an external audit had exposed the "historical anomaly", with about 1,200 tenants overcharged, and more than 1,600 undercharged.

The council said it did not apply government guidance when calculating social housing formula rents "as it should have", adding it based rents on an average capital value for each property by bedroom size.

The district council has estimated it will need about £1.5m to repay overcharged tenants.

Andrew Jarrett, deputy chief executive who is responsible for finance, said: "Residents will be told whether they will get compensation on top [of their repaid rent].

"The tenants that have no benefits and who paid the rent in totality themselves are the ones who we should be able to get refunds to in the next couple of months."

The council was waiting on information from the Department for Work and Pensions (DWP) to calculate refunding people whose rent was partly paid through benefits, Local Democracy Reporting Service said.

Legal advice means the council will only refund overpaid rent for a six-year period.

The issue, which goes back to 2002, was identified towards the end of 2024 by the council's new auditor, Bishop Fleming.

Jarrett said it was an "embarrassing error".

He said: "We have taken all the actions we should have done and we have spoken to the regulator of social housing and they seem confident with how we are dealing with it."

In a statement on its website, the council said it did not intend to claim back money from underpayments, but said it was "likely" new charges would come into effect at the end of a tenancy agreement.

The council has £2m in reserves in one housing finance pot, with other housing-related reserves amounting to more than £21m.

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