Tenant rental payments are credited to the Housing Revenue Account (HRA) which every council is legally obliged to maintain, and this account cannot be topped up by other council monies, nor can it be used to contribute to the general finances of the council either. Its ring-fenced, in other words. Additionally, by law the HRA is not allowed to go into deficit.
All in all, it means the HRA account is, unless something is done is heading for deficit, something it legally cannot do.
The council have used a outside firm, called Tribal Consulting, (is this the same one used to recruit potential candidates for the Conservatives at local elections?) to come up with various scenarios on what happens if we do this, this or this.
The proposal is that council rents are increased by 3.9% plus inflation representing an overall increase of over 6% in real terms.