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 2023/24.

Matter for Decision

The Housing Revenue Account (HRA) Medium Term Financial Strategy (MTFS) provides 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 national and local 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.               Approved the Housing Revenue Account Medium Term Financial Strategy attached to the officer’s report, and included all proposals for changes in:

a.    Financial assumptions as detailed in Appendix B of the document.

b.    2022/23 and future year revenue budgets, resulting from changes in financial assumptions and the financial consequences of changes in these and the need to respond to unavoidable pressures and meet new service demands, as introduced in Section 5, detailed in Appendix D and summarised in Appendices G (1) and G (2) of the document.

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

 

The Executive Councillor for Housing recommends to Council to:

iii.            Approve proposals for changes in existing housing capital budgets, as introduced in the officer’s report at 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 20 October 2022.

iv.           Approve proposals for new housing capital budgets, as introduced in the officer’s report at 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 20 October 2022.

v.             Approve the revised funding mix for the delivery of the Housing Capital Programme, recognising the latest assumptions for the use of Grant, Right to Buy Receipts, HRA Resources, Major Repairs Allowance and HRA borrowing.

 

 

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 Assistant Head of Finance and Business Manager and the Director of Enterprise and Sustainable Development said the following in response to Members’ questions:

i.               With reference to Section 6 of the MTFS, it was noted that the contract for external planned works to housing stock was with Fosters Property Maintenance and the Council was looking to extend this contract. The outcome of the recent procurement regarding the internal planned investment works would be announced soon. It was also noted that the companies currently running both contracts did sub-contract some of the works.

ii.             Noted the challenge regarding financing the retrofit of existing council housing stock. Looked to Government funding to bring forward more opportunity for retrofit financing.

iii.            Noted comments on section 8 of the MTFS which referred to how amendments to the budget would be member led rather than officer led going forward.

iv.           There was a risk that interest rates could increase further, the MTFS assumed an interest rate of just under 3.5%. If the interest rate increased, then there could be an impact on the new build housing programme and the council would need to consider what type of housing it could deliver. Noted that a lot of the services provided by the Housing Department are in response to statutory responsibilities.

v.             The Council had considered whether it could deliver its own cheaper electricity however it was noted that other Local Authorities which had explored this option had not been successful. This issue would require significant investment and consideration would need to be given as to why other Local Authorities had failed.

 

The Committee resolved by 9 votes to 0 to endorse recommendations i and ii.

 

The Committee resolved by 5 votes to 0 to endorse recommendations iii to v.

 

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.