The National Housing Federation (NHF) has written to the prime minister, expressing its “grave” concern over the government’s plans to cut social rents by up to £260 million a year. The NHF said that the rent reductions would mean 4,000 fewer affordable homes would be built each year, totalling within a decade 40,000 “safe secure places for 40,000 families to thrive.” This planned cut in housing associations’ income comes weeks after the government’s announcement to deliver 20,000 additional homes with £1.5 billion funding, the federation also pointed out. Rental reduction was necessary to combat deflation, the government said. Housing rents are linked to a formula of September’s Retail Price Index (RPI) plus 0.5% each year. NHF’s chief executive David Orr said: “Despite the fact that the formula does not mention cuts at all, the government says it’s being generous by limiting cuts to 2% against a Treasury predicted RPI of -3% for this September.” Orr added that reducing rents next year would leave a permanent hole in capacity. <br>