Issue - meetings

Report of the Director of Finance. To be introduced by the Cabinet Member for Housing and Planning(Deputy Leader).

Cabinet to note the proposed Housing revenue account capital programme and revenue budgets, which includes proposed tenants rent & service charge increases for 2025/26.

The Cabinet Member for Housing and Planning (Deputy Leader) introduced the report which proposed  the draft annual business plan for its Housing Revenue Account (HRA) for 2025/26, as part of the wider budget/MTFS proposals. The Housing Revenue Account covered income and expenditure relating to the Council’s own housing stock. It was an account that is ring-fenced from the Council’s general fund, as required by the Local Government Act 1989. The HRA business plan considers projected income and expenditure over a 10- and 30-year period and the income generated from tenants and leaseholders was used solely for the purpose of investment in its homes, in delivering new Council homes, and providing good quality services to tenants and leaseholders.

In response to questions from Cllr Cawley- Harrison, the following information was noted.

-       With regards to the confidence in the reserve position of the HRA, the annual revenue contribution to capital outlay (RCCO), which was the revenue surplus after expenditure, set out in the plan was to maintain an ongoing £8m minimum annual surplus. The plan also assumed a year on year working balance of £20m. This increased position was established at the end of 2021/22 and was recommended to be retained to enable the Council to deal with any unforeseen risks in the light of the extensive programme it was undertaking and the challenging external environmental factors.

-       Regarding the assertion that failure to invest in housing stock long-term had an  impact on repair costs and the associated overspend on repair costs from adopting a fire-fighting approach to repairs, it was noted that the fundamental issue was that rents had not kept up with inflation for many years, as rents had been capped by successive governments. The result of this was an under-investment in housing stock over many years. The Cabinet Member set out that there was a move in government for rent convergence, which would see rent levels brought back in line with where they should have been. The Cabinet Member cautiously welcomed this proposal and advised that it would help local authorities with investment and sustainability of their housing stock.

-       In relation to general needs void properties and clearing this backlog to address the budget surplus gap in the HRA, the Operational Director for Housing challenged the assertion that the Council had failed to make improvements in turning around void properties. It was commented that last year the Council had a backlog of voids going back many years. As of the current financial year, that back-log had reduced. . However, at the same time there had also been around 350 properties that had become void in the current financial year, so there was significant churn in this area. Of the 350 voids, 120 of those were the direct result of a Neighbourhood Moves scheme. The Operational Director of Housing acknowledged that the number of voids was higher than the organisation would like it to be. However, the issue was that a significant number of new voids were coming  ...  view the full minutes text for item 86