Decision details

Approval of latest financial assumptions for the HRA financial forecasts, of any in year budgetary changes for the HRA and of the approach to setting the budget for 2019/20.

Matter for Decision

The Housing Revenue Account (HRA) Medium Term Financial Strategy (MTFS) 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 (part 1)

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

•      Financial assumptions as detailed in Appendix B of the officer’s report.

• 2018/19 revenue budgets and future year forecasts as introduced in Section 5, resulting from changes in financial assumptions and the financial consequences of change and the need to respond to unavoidable pressures, as introduced in Section 5, detailed in Appendix D of the document and summarised in Appendices G (1) and G (2).

•      The level of fees charged to new build schemes by the Housing Development Agency, as detailed in Section 7 of the Housing Revenue Account Medium Term Financial Strategy.

    ii.        Approved that delegated authority be given to the Strategic Director to be in a position to confirm that the authority can annually renew its investment partner status with Homes England.

 

Decision of Executive Councillor for Housing (part 2)

   iii.        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, for decision at Council on 18th October 2018.

 

 

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 Principal Accountant.

 

In response to the Committee’s comments the Principal Accountant and Strategic Director said the following:

     i.        Comments from the Committee on the Government’s Housing Green Paper should be sent to the Housing Services Manager. A draft response would then be circulated to the Chair, Vice Chair and Opposition Spokes. Members of the Committee would be sent a copy of the final response when it had been sent to Government.  

    ii.        Money could be taken from the strategic expenditure fund for work on the Storage in Communal Areas – Zero Tolerance Policy. This could occur if savings were identified in other areas and officers brought forward bids to carry out work on this project as part of the budget setting process in January 2019.  The five year Strategic Investment Fund and Savings Fund would also allow officers to put forward proposals for funding if required as the project continued.

   iii.        An additional £100,000 had been included in the MTFS to advance with the back log of work which had resulted from the stock condition survey.

  iv.        Due to staffing issues the stock condition data was not as up to date as it should be on the Council’s financial management system. The recommendation for additional resource would resolve the issue if approved by the Committee.

   v.        The demolition to disposal reported in the previous year (2017/18) mainly related to the demolition of the flats and bungalows at Anstey Way.  The new build programme on this site would double the properties that had been pulled down.

  vi.        Recruitment had been undertaken to all posts which had been created as part of the restructure for Housing Services /   City Homes. The budget allowed for 97% of the total salary bill recognising there would always be a natural turnover of staff.

 vii.        There would be a small underspend concerning staffing costs in Maintenance and Assets with a number of vacant posts covered by interim and agency staff; the new Head of Service would start in October while the Operation Managers post was being covered on an interim basis. The market was very competitive due to the upturn of residential and construction build in Cambridge and the surrounding areas.   

viii.        There could be a possible underspend in programme delivery due to the shortage of Surveyors in Maintenance and Assets. Recruitment in this area was proving difficult but was being covered by agency staff. 

  ix.        Was aware of the comments made by the Mayor of Cambridgeshire and Peterborough Combined Authority that it was possible to build a house of for £100,000 on land that they owned.

   x.        Independent consultancy advice was being carried out to review the cost that the Council were paying for staff and services.

  xi.        A range of measures were in place internally and externally to deal with the impact of Universal Credit internally and externally. Advisors from Citizens Advice Bureau funded by the Council would be present at Job Centre Plus, as would Revenue and Benefit Officers. Resource for an additional Financial Inclusion Officer in the City Homes Team was also in place.

 

Councillor Cantrill put forward the following questions to the Executive Councillor for Housing (highlighted in bold). 

 

When elected the Mayor of Cambridgeshire and Peterborough Combined Authority stated he would not go back to Government and request extra finances. But he has made a request to the Treasury last week. Would the Executive Councillor for Housing request a proportion of this funding to be spent on Cambridge; with the Authority receiving £100,000,000 to be spent outside of the City, there is an urgent need for money to be spent in Cambridge?

 

The approach taken by the Combined Authority seemed to concentrate on funding mechanisms, not where housing was most needed and solutions on how this could be provided; particularly in Cambridge and South Cambridgeshire where there was a greater need. It did not also address the problems that Housing Associations faced and how their housing stock could be increased. 

 

The Chancellor stated in the last Budget he was prepared to allow certain authorities to raise their borrowing cap to undertake new house building. To what extend has the Council made advances to Government to increase the borrowing cap to address the housing needs to in city? 

 

The issue had been raised with Government Minsters on several occasions, particularly during the devolution discussions about the need to review and revise the borrowing cap. It was disappointing the Green Paper had not addressed this issue as it was important that Councils had the freedom of flexibility in managing their Housing Revenue Account. It was a matter the Council would continue to lobby Central Government to change their approach.

 

The Committee resolved by 8 votes to 0 to endorse the recommendations (i to ii) in the officer’s report.

 

The next vote was taken after Item 14 of the agenda

 

The Committee resolved unanimously to endorse the recommendation (iii) in the officer’s report.

 

The Executive Councillor approved the recommendations.