Agenda item

Report of the Director of Finance. To be presented by the Cabinet Member for Housing and Planning, and Deputy Leader of the Council.

This report is for the Council to set a business plan for its Housing Revenue Account (HRA) 2025/26 & its Medium-Term Financial Strategy 2025/26-29/30

The Cabinet Member for Housing and Planning, and Deputy Leader of the Council introduced the report. It was explained that Haringey was committed to fairer housing, explaining that means making sure residents had safe, stable, warm and comfortable homes. It was noted that the Council invested the HRA (Housing Revenue Account) into repairing and renovating existing Council homes and into building new homes for people on the waiting list. It was explained that the Council wanted both existing Council tenants and new Council tenants to live in high quality homes and that more families and individuals in the borough who needed the security of social housing to be able to set down roots and thrive. It was explained that key investments made in existing council homes included: improving kitchens and bathrooms; keeping estates safer, and; keeping homes warm and dry – and making homes cheaper to heat.

It was explained that investment in new Council homes and renovation work to existing council homes would help reduce the need for future expenditure on repairs.

The Cabinet Member explained that, as well as capital investment, the HRA delivered important services to tenants and leaseholders, including tenancy services, income services (including the financial inclusion service), estates and neighbourhood services. It was noted that that residents that need support would be able to live well in their homes and communities utilising these services.

It was stressed that setting a sustainable HRA had become significantly more challenging in recent years. It was noted that higher interest rates and inflation were driving up costs across the board and that construction costs had been rising for some years, increasing the cost of repairs and important building safety works. It was explained that, at times, Council rent rises were kept below inflation, either by national government or by local councils, with a series of 1% rent cuts between 2016 and 2020 and a sub-inflation rise in 2023-24. The Council were able to continue to provide services to tenants and leaseholders, to invest in their homes and to build thousands of new council homes over time, a major programme that is delivering genuinely affordable homes that local people need.

In response to comments and questions from Cllr Cawley-Harrison, the following information was shared:

·         That new builds go through a value engineering process to ensure that development contracts offer the best value for money at the time.

·         That Long-Term Voids, those that required major structural works, had work nearly completed, and that the Voids team has been exceeding targets. It was noted that there was an impetus to continue and expand this work.

·         Officers explained that the business plan had reduced the cost of the housing delivery programme by 14% through good procurement and forward planning.

·         Officers explained that they had increased the budget in the Housing Revenue Account to support target of delivery of additional homelessness discharge acquisitions and that the Council had also applied to the Greater London Authority (GLA) for additional funding for acquisition of Council homes to discharge this duty.

RESOLVED:

That Cabinet:

1. Approved the proposed increases in rent of 2.7% to existing tenancies and noted that rents on other forms of tenancies would continue as approved in prior years by Cabinet.

2. Approved the proposed average service charge increases. However, noting that the increases in service charges to individual tenants would vary depending on the service they receive.

3. Proposed that the Council approve on 3 March 2025 the HRA 2025/26 Budget and 2025/26-29/30 MTFS, which included the proposed revenue and capital spend over the period.
   
   

Reasons for decision

The Council must legally set a balanced HRA budget and have a sustainable HRA Business Plan to ensure that it is able to manage and maintain its homes, provide services to tenants and leaseholders and build much needed new Council homes.

Alternative options considered

Not Applicable