RENTS will rise and services will suffer if council house tenants in Derwentside opt to remain under local authority control, it was claimed last night.

Alex Watson, leader of Derwentside District Council, made the bleak prediction as members agreed to inform residents of their options over the future of their housing stock.

They voted to send a document outling the proposed change of ownership for 7,600 council houses at a specially-called meeting at the Civic Centre in Consett last night.

The council needs to invest £117m in its housing stock to bring it up to the modern standards residents have asked for.

Its current budget allows for £51m to be spent on major works, repairs and improvements over the next 13 years.

The council wants to transfer its a stock to Derwentside Homes, a non-profit organisation that will be able to access more money.

Council leader Alex Watson said: "This is not something we are happy about, but it is the best option.

"It is because a housing association can borrow £117m against its assets and we, as an authority, cannot.

"It will be run by a board of 15 people, including five tenants, five councillors and five housing experts, so there will plenty of influence and they will determine how the money is invested.

"It really is the only way forward because, if we retain the housing stock, we are going to have to increase rents to make the improvements and, as a result of that, other services are going to suffer."

The final decision will be made by residents in a secret ballot in November.

Earlier this year, council house residents in Sedgefield and North Tyneside voted for their local authorities to retain control following campaigns by the trade union Unison.

Unison regional convenor Clare Williams said: "We will be opposing this because we believe that housing should be in the public sector.

"When councils own housing, there is some democratic accountability. But private companies are there to make money.

"This is about providing decent housing, not maximising profit.

"This is not the only option people have and they tend to prefer to stay with their local authority."

Anyone with questions can call the stock transfer team at Derwentside District Council on 0800 977 6018.