Decision details

To agree the budget strategy and timetable for 2018/19, the net savings requirements, by year for the next 5 years, and revised HRA revenue, funding and reserves projections.

Recommendation (a) was chaired by Diana Minns (Vice Chair / Tenant Representative) and recommendation (b) was chaired by Councillor Todd-Jones

 

Matter for Decision

The Housing Revenue Account (HRA) Medium Term Financial Strategy provided an opportunity to review the assumptions incorporated as part of the longer-term financial planning process, recommending any changes in response to new legislative requirements, variations in external economic factors and amendments to service delivery methods, allowing incorporation into budgets and financial forecasts at the earliest opportunity.

 

Decision of Executive Councillor for Housing

       i.          (Recommendation 2.1) Approved the Housing Revenue Account Medium Term Financial Strategy, to include all proposals for change in:

·     Financial assumptions as detailed in Appendix B of the Officer’s report.

·     2017/18 revenue budgets as introduced in Section 5 of the Officer’s report, resulting from changes in financial assumptions and the financial consequences of change, as introduced in Section 5, detailed in Appendix D of the Officer’s report and summarised in Appendix G of the Officer’s report.

·     The revised Rent Setting Policy as detailed in Appendix L of the Officer’s report.

     ii.          (Recommendation 2.2) Approved proposals for changes in existing housing capital budgets, as introduced in Sections 6 and 7 and detailed in Appendix E of the document, with the resulting position summarised in Appendix H of the document, for decision at Council on 19th October 2017.

 

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 Business Manager and Principal Accountant.

 

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

       i.          Suggested that the coming year would be challenging for tenants.

     ii.          Stated that members of the public did not understand the terms such as Local Housing Allowance levels or Social Rents or Affordable Rents.

   iii.          Improved media messages would allow people to understand the constraints on new homes delivery.

   iv.          Questioned why such high reserves were being retained.

    v.          Councillor Cantrill welcomed the strategic approach but questioned the ability to deliver the 500 new homes target. He suggested that reserves should be used to address current issues and to deliver 300 homes in addition to the 200 that were already in the pipeline.

 

The Strategic Director stated that the timeframe set by Government for the delivery of the 500 homes required that work be started on site within 5 years rather than 500 new homes completed. The current programme included a number of small sites. Larger sites were in the pipeline and detailed reports would follow regarding future projects. She confirmed that the Combined Authority would hold the City to account for the delivery of new homes.

 

The Business Manager and Principal Accountant said the following in response to Members’ questions:

       i.          Stated that a budget was in place to buy new homes on the open market, in the short term, should Right to Buy receipts be in danger of being lost due to delays in using them.

     ii.          Confirmed that some units of shared ownership had proved difficult to sell due to the price and the lack of parking. The units would be revalued with the options of repricing or conversion to rented accommodation under consideration. 

   iii.          The move out of the South Area Office had resulted in savings. However, as no suitable sub-let had been agreed, the savings were less that those predicted.

   iv.          Confirmed that reserves were always maintained at a three million pounds minimum contingency fund. However, levels were currently higher than expected due to retention of Right to Buy receipts. Delays in the hand-over of new build properties also increased reserves as final payment had not been released on the intended dates.

 

The Strategic Director and the Business Manager and Principal Accountant the made the following comments in response to Councillor Cantrill’s suggestion that the depot site on Mill Road could be delivered as 100% affordable housing:

       i.          The identified housing need was for one bed properties and building them all in one place would not produce a mixed or balanced community.

     ii.          Other development had been required to offer a mix of housing tenures and failure to do so on this site would be hard to defend.

   iii.          The site was a general fund asset the Council had a duty to secure the best value for such assets. This would impact on any future decisions.  

 

The Committee asked for more information regarding Council owned garages, such as: who was currently using them, how many were empty and how many were too small to accommodate modern cars. The Strategic Director undertook to produce a briefing note on council garage stock.

 

The Committee resolved by 10 votes to 0 with 2 abstentions to endorse the recommendation 2.1 (i) in the Officer’s report.

 

The Committee resolved by 5 votes to 0 with 2 abstentions to endorse the recommendation 2.2 (ii) in the Officer’s report.

 

The Executive Councillor approved the recommendation.