Decision details

Matter for Decision

     i.        As part of the 2020/21 budget process, the range of assumptions upon which the Housing Revenue Account (HRA) Business Plan and Medium Term Financial Strategy were based, had been reviewed in light of the latest information available, culminating in the preparation of the HRA Budget Setting Report.

    ii.        The HRA Budget-Setting Report provided an overview of the review of the key assumptions. It sets out the key parameters for the detailed recommendations and final budget proposals, and was the basis for the finalisation of the 2020/21 budgets.

 

Decision of Executive Councillor for Housing

 

Under Part 1 of the agenda, the Executive Councillor resolved to:

 

Review of Rents and Charges

 

a)      Approve that council dwellings rents for all social rented properties be increased by inflation of 1.7%, measured by the Consumer Price Index (CPI) at September 2019, plus 1%, resulting in rent increases of 2.7%, with effect from 6 April 2020. This equates to an average rent increase at the time of writing this report of £2.65 per week on a 52 week basis.

 

b)      Approve that affordable rents (inclusive of service charge) are reviewed in line with rent legislation, to ensure that the rents charged are no more than 80% of market rent, with current rent levels increased by no more than by inflation of 1.7%, measured by the Consumer Price Index (CPI) at September 2019, plus 1%, resulting in rent increases of up to 2.7%.  Local policy is to cap affordable rents (inclusive of all service charges) at the Local Housing Allowance level, which will result in rent variations in line with any changes notified to the authority in this level if these result in a lower than 2.7% increase.

 

c)      Approve that rents for shared ownership are reviewed and amended from April 2020, in line with the specific requirements within the lease for each property.

 

d)      Approve that garage and parking space charges for 2020/21, are increased in line with inflation at 1.8%, with resulting charges as summarised in Section 3 of the HRA Budget Setting Report

 

e)      Approve the proposed service charges for Housing Revenue Account services and facilities, as shown in Appendix B of the HRA Budget Setting Report.

 

f)       Approve the proposed leasehold administration charges for 2020/21, as detailed in Appendix B of the HRA Budget Setting Report.

 

g)      Approve that caretaking, building cleaning, estate services, grounds maintenance, temporary housing premises and utilities, sheltered scheme premises and utilities, digital television aerial, gas maintenance, door entry systems, lifts, electrical and mechanical maintenance, flat cleaning, third party management and catering charges continue to be recovered at full cost, as detailed in Appendix B of the HRA Budget Setting Report, recognising that local authorities should endeavour to limit increases to inflation as measured by CPI at September 2019 (1.7%) plus 1%, wherever possible.

 

Revenue – HRA

 

Revised Budget 2019/20:

 

h)      Approve with any amendments, the Revised Budget identified in Section 4 and Appendix D (1) of the HRA Budget Setting Report, which reflects a net reduction in the use of HRA reserves for 2019/20 of £146,310.

 

Budget 2020/21:

 

i)       Approve with any amendments, any Non-Cash Limit items identified in Section 4 of the HRA Budget Setting Report or shown in Appendix D (2) of the HRA Budget Setting Report.

 

j)        Approve with any amendments, any Savings, Increased Income, Unavoidable Revenue Bids, Reduced Income proposals and Bids, as shown in Appendix D (2) of the HRA Budget Setting Report.  

 

k)       Approve the resulting Housing Revenue Account revenue budget as summarised in the Housing Revenue Account Summary Forecast 2019/20 to 2024/25 shown in Appendix J of the HRA Budget Setting Report.

 

Under Part 2 of the agenda, the Executive Councillor for Housing resolved that recommend to Council:

 

Treasury Management

 

l)        Approve the need to borrow over the 30-year life of the business plan, with the first instance of this anticipated to be in 2022/23, to sustain the current level of investment, which includes £10,000,000 per annum for the delivery of new homes.

 

m)     Recognise that any decision to borrow further will impact the authority’s ability to set-aside resource to redeem 25% of the value of the housing debt by the point at which the loan portfolio matures, with the approach to this to be reviewed before further borrowing commences.

 

Housing Capital

 

n)      Approval of capital bids and savings, shown in Appendix D (3) of the HRA Budget Setting Report, to include funding to begin to improve the energy efficiency of the existing housing stock.

 

o)      Approval of the latest Decent Homes Programme, to include an updated recharge of capitalised officer time and timing of decent homes expenditure for new build dwellings, as detailed in Appendix E of the HRA Budget Setting Report.

 

p)      Approval of the latest budget sums, profiling and associated financing for all new build schemes, including revised scheme budgets for Akeman Street, Meadows and Buchan Street and Campkin Road, based upon the latest cost information from the Cambridge Investment Partnership (CIP) or direct procurements, as detailed in Appendices E and H, and summarised in Appendix K, of the HRA Budget Setting Report.

 

q)      Approval of re-phasing of budget for the Estate Improvement Scheme, to also include reallocation of the resource between capital and revenue based upon the projects identified to date, as detailed in Appendix E, and summarised in Appendix K, of the HRA Budget Setting Report.

 

r)       Approval of the revised Housing Capital Investment Plan as shown in Appendix K of the HRA Budget Setting Report.

 

General

 

s)      Approval of inclusion of Disabled Facilities Grant expenditure and associated grant income from 2020/21 onwards, based upon 2019/20 grant levels, with approval of delegation to the Head of Finance, as Section 151 Officer, to approve an in year increase or decrease in the budget for disabled facilities grants, in direct relation to any increase or decrease in the capital grant funding for this purpose, as received from the County Council through the Better Care Fund.

 

t)        Approval of delegation to the Strategic Director to review and amend the level of fees charged by the Shared Home Improvement Agency for disabled facilities grants and repair assistance grants, in line with any decisions made by the Shared Home Improvement Agency Board.

 

u)      Approval of delegation to the Strategic Director, in consultation with the Head of Finance, as Section 151 Officer, to draw down resource from the ear-marked reserve for potential debt redemption or re-investment, for the purpose of open market land or property acquisition or new build housing development, should the need arise, in order to meet quarterly deadlines for the use of retained right to buy receipts or to facilitate future site redevelopment.

 

v)      Approval of delegation to the Head of Finance, as Section 151 Officer, to make the necessary technical amendments to detailed budgets in respect of the outcome of the review of recharges between the General Fund and the HRA and the outcome of the review of the pension fund deficit contribution, with any net impact for the HRA to be incorporated as part of the HRA Medium Term Financial Strategy in September 2020.

 

Reason for the Decision

As set out in the Officer’s report.

 

Any Alternative Options Considered and Rejected

Not applicable.

 

Scrutiny Considerations

 

The Committee received a report from the Assistant Head of Finance and Business Manager.

 

The Committee noted that since publication of the report, the authority had received final confirmation of the pension figures, which were marginally lower than anticipated. The Assistant Head of Finance and Business Manager highlighted that a delegation to the Head of Finance had been included in the HRA BSR Covering Report to allow the required adjustments to be made once this figure was confirmed, and that this delegation would now be applied.

 

The Committee made the following comments in response to the report:

     i.        Noted the commitment in the budget to the Housing First Caretaker scheme.

    ii.        Welcomed the Housing First Caretaker roles but suggested that they should be employed on a higher pay grade as the job would be complex and demanding.

 

The Assistant Head of Finance and Business Manager, assisted by other officers (Head of Housing, Strategic Director, Head of Housing Development and Head of Housing Maintenance and Assets) stated the following in response to Members’ questions:

     i.        Explained why the figure for disabled adaptations had been reduced. This was based on previous demand trends which had reduced. This was in part due to the number of properties within the portfolio that had already been adapted. Confirmation was given that demand would be reviewed and the budget reconsidered in future years if demand increased.

    ii.        Confirmed that the Energy Officer would initially look at energy efficiency in the Council’s own housing stock.

  iii.        Explained that the Tenancy Auditor was for an initial pilot period of one year. In the long-term any post may be expected to be self-financing as it should help identify tenancy fraud, preventative repairs and tenants in need of additional support services. Extending the project to include Leasehold properties could be considered later.

  iv.        Confirmed that Cambridge had been late in the roll out programme of Universal Credit and the full impact had not yet been seen.

   v.        Confirmed that the net unavoidable revenue pressure in cyclical maintenance was the net position for the cost centre after virements between areas of spending. The officer confirmed that under the Council’s financial standing orders, cost centre managers have the ability to move funds between expenditure heads within a cost centre to better deliver services. The Assistant Head of Finance and Business Manager undertook to circulate the detailed virements that resulted in the net revenue pressure, after the meeting, for information.

 

Councillor Cantrill introduced the Liberal Democrat Amendment to the 2020/21 Housing Revenue Budget.

 

The Committee made the following comments in response to the report:

 

     i.        Suggested that targeting rent reduction to larger homes would be targeting support to larger families who may not need that support rather than to those on lower incomes. Stated that this would be unfair, and that the reduced rental income would in turn reduce the ability to build more properties.

    ii.        Stated that a move to Passive House Building methods would require an evidenced based analysis of what could be achieved. It would also significantly increase the spend on new build properties.

  iii.        Agreed that further advice on alternatives was needed before gas boilers were replaced like for like.

 

 

The following vote was chaired by Diana Minns (Vice Chair  / Tenant Representative)

 

The Liberal Democrats Group alternative budget: 3 votes in favour to 8 against. The amendment was lost.

 

Resolved (8 votes to 0) to endorse the original recommendations a to k of the budget proposal. 

 

The following vote was chaired by Councillor Todd-Jones

 

Resolved (5 votes to 0) to endorse the original recommendations l to v of the budget proposal. 

 

The Executive Councillor approved the recommendations.

 

Conflicts of Interest Declared by the Executive Councillor (and any Dispensations Granted)

No conflicts of interest were declared by the Executive Councillor.