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5 Housing Revenue Account Budget Setting Report (HRA BSR) PDF 605 KB
Covering report to follow
Additional documents:
Minutes:
Matter for Decision
At this stage in
the 2013/14 budget process the range of assumptions on which the HRA Business
Plan Mid-Year Update was based need to be reviewed, in light of the latest
information available, to determine whether any aspects of the strategy need to
be revised. This will then provide the basis for the finalisation of the
2012/13 revised and 2013/14 budgets.
The HRA
Budget-Setting Report provided an overview of the review of the key
assumptions. It set out the key parameters for the detailed recommendations and
final budget proposals.
Housing Management
Board scrutinised the detailed rent, and service charge proposals and revenue
bids and savings proposed, The Executive Councillor noted the support of
the recommendations by Housing Management Board, gave provisional approval to
the recommendations and will formally
record a decision in respect of recommendations (i) to xiii) at a
meeting of Strategy & Resources on 15th February 2013
Decision of Executive Councillor for Housing
Following scrutiny and debate at Housing Management
Board the Executive Councillor provisionally, with the decision to be formally
recorded at the meeting of Strategy & Resources on 15th February
2013.
Review of Rents and Charges
(i)
Approved the proposed
charges for Housing Revenue Account services and facilities, as shown in
Appendix B of the HRA Budget Setting Report.
(ii)
Approved that council
dwellings rents be increased in line with rent restructuring guidelines to seek
to achieve convergence with formula rent by 2015/16, with a maximum in
individual increases of inflation (RPI at September 2012 of 2.6%) plus half
percent (0.5%) plus £2.00 per week with effect from 1 April 2013, in accordance
with the latest government guidelines.
(iii)
Approved inflationary
increases of 2.4% in garage rents for 2013/14, in line with the base rate of
inflation for the year assumed in the HRA Budget Setting Report, pending future
recommendations in respect of garage pricing structures following the findings
of the Garage Working Group.
(iv)
Approved that service
charges for gas maintenance, door entry systems, lifts and electrical and
mechanical maintenance are increased by a maximum of inflation at 2.6% plus
0.5%, if required, to continue to recover full estimated costs as detailed in
Appendix B of the HRA Budget Setting Report.
(v)
Approved that caretaking,
communal cleaning, estate services, grounds maintenance, window cleaning,
temporary housing premises and utilities, sheltered scheme premises, utilities,
digital television aerial and catering charges continue to be recovered at full
cost, as detailed in Appendix B of the HRA Budget Setting Report.
(vi)
Approved revised leasehold
administration charges for 2013/14 as detailed in Appendix B of the HRA Budget
Setting Report.
(vii)
Approved the revised Rent
Write Off Policy, as detailed in Appendix A(1) of the HRA Budget Setting
Report.
(viii)
Approved the revised Rent
Policy, as detailed in Appendix A(2) of the HRA Budget Setting Report.
Revenue – HRA Revised Budget 2012/13:
(ix)
Approved with any amendments, the Revised Budget items
shown in Appendix D of the HRA Budget Setting Report.
Budget 2013/14:
(x)
Approved with any
amendments, of the Non-Cash Limit items shown in Appendix E of the HRA Budget
Setting Report.
(xi)
Approved with any
amendments, of the Unavoidable Revenue Bids and Savings shown in Appendix F of
the HRA Budget Setting Report.
(xii)
Approved with any
amendments, of the Priority Policy Fund (PPF) Bids shown in Appendix G of the
HRA Budget Setting Report.
Treasury Management
(xiii)
Approved the continued
approach to determining the most appropriate borrowing route in respect of any
additional HRA borrowing requirement, as outlined in Section 6 of the HRA
Budget Setting Report, delegating responsibility to the Director of Resources for
the final decision, in consultation with the Executive Councillor, Chair, Vice
Chair and Opposition Spokesperson for HMB.
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 & Principal Accountant
regarding the Housing Revenue Account Budget Setting Report
(HRA BSR).
The Business Manager &
Principal Accountant requested a change to the recommendations. She
formally proposed that instead of making a decision at HMB, the Executive Councillor for Housing would take
final decisions in respect of recommendations (i) to (xiii) at a meeting of
Strategy & Resources in February 2013.
The Business Manager & Principal
Accountant formally proposed to withdraw the following
recommendations from the her report:
The Executive Councillor recommended to Council:
Revenue – HRA Revised Budget 2012/13:
(ix)
Approval with any
amendments, of the Revised Budget items shown in Appendix D of the attached HRA
Budget Setting Report.
Budget 2013/14:
(x)
Approval with any
amendments, of the Non-Cash Limit items shown in Appendix E of the attached HRA
Budget Setting Report.
(xi)
Approval with any amendments,
of the Unavoidable Revenue Bids and Savings shown in Appendix F of the attached
HRA Budget Setting Report.
(xii)
Approval with any
amendments, of the Priority Policy Fund (PPF) Bids shown in Appendix G of the
attached HRA Budget Setting Report.
Treasury Management
(xiii)
To approve the continued
approach to determining the most appropriate borrowing route in respect of any
additional HRA borrowing requirement, as outlined in Section 6 of the HRA
Budget Setting Report, delegating responsibility to the Director of Resources
for the final decision, in consultation with the Executive Councillor, Chair,
Vice Chair and Opposition Spokesperson for HMB.
The following
recommendations were formally proposed:
Revenue – HRA
Revised Budget 2012/13:
(ix) Approve with any amendments, the Revised
Budget items shown in Appendix D of the attached HRA Budget Setting Report.
Budget 2013/14:
(x)
Approve with any amendments, the Non-Cash Limit
items shown in Appendix E of the attached HRA Budget Setting Report.
(xi)
Approve with any amendments, the Unavoidable
Revenue Bids and Savings shown in Appendix F of the attached HRA Budget Setting
Report.
(xii)
Approve with any amendments, the Priority Policy
Fund (PPF) Bids shown in Appendix G of the attached HRA Budget Setting Report.
Treasury Management
(xiii)
Approve the continued approach to determining the most
appropriate borrowing route in respect of any additional HRA borrowing
requirement, as outlined in Section 6 of the HRA Budget Setting Report,
delegating responsibility to the Director of Resources for the final decision,
in consultation with the Executive Councillor, Chair, Vice Chair and Opposition
Spokesperson for HMB.
The Committee unanimously
approved amending the recommendations.
The Committee made the
following comments in response to the report:
(i)
Labour
Councillors and Tenant Representatives expressed concern at the above inflation
rent rises.
(ii)
Labour
Councillors and Tenant Representatives expressed concern regarding the right to
buy policy. They felt Central Government policy would lead to a reduction in
City Council housing stock as tenants could purchase their properties at a
faster rate than replacements could be built.
(iii)
Tenant
Representatives referred to comments from a member of the public at the 19 June
2012 HMB regarding Tenant Representatives voting stance on rent rises. Tenant
Representatives were placed in a difficult position as their role on HMB was to
represent tenant and leaseholder views. Tenant Representatives abstained from
voting on increasing rents as they had reservations about the rise, but
recognised that not increasing the rents would lead to consequences in terms of
the ability to deliver services, due to Central Government assumptions on rent
increases in the HRA Self-Financing Settlement.
In response to
Members’ questions the Head of City Homes plus Business Manager & Principal
Accountant confirmed the following:
(i)
A charge of
£10 was imposed for retrospective consent for improvements. This was intended
only to be a disincentive, thus encouraging leaseholders to obtain permission
in advance, and was not set to recover the costs associated with giving the
required permissions. If the direct costs for all approvals were to be
recovered, other methods were available to reclaim these.
(ii)
The Council
had 19 cases between 2009 – 2012 where retrospective permission was sought.
The Head of City Homes undertook to liaise with the Executive Councillor
for Housing and Mrs Best regarding a future report to HMB on possible
amendments to the £10 charge. Also ways to avoid penalising
tenants/leaseholders who sought approval when others may undertake work without
seeking approval in order to avoid being charged.
(iii)
A blanket
policy was not in place for void property rent increases. Rent would increase
for properties where work had been undertaken to improve energy efficiency as
the reduced energy bills should help to offset rent increases. Rent would not
move directly to target for all properties.
(iv)
The Housing
Needs Register was revised in line with national property guidelines and would
be reported to 17 January Community Services Committee.
(v)
The Council
preferred to house people on a short term basis in its temporary housing stock rather
than bed and breakfast accommodation where possible. Maintenance costs were
higher than other council housing stock due to the high turn over of residents.
The Council had 63 temporary housing units that it owned or managed. More had
been taken on as a way to house people in the City instead of sending them
elsewhere or placing in bed and breakfast accommodation as had sometimes
occurred in the past. The Housing Team reviewed individual circumstances to
place families and workers in Cambridge where possible.
(vi)
The Business
Manager & Principal Accountant undertook to clarify Disabled Facilities
Grant plus Private Sector Housing Grants and Loans figures with Councillor Bird
post HMB. A reduction was proposed in response to less demand in 2012/13.
In response to
Members’ questions the Executive Councillor for Housing and Director of Customer & Community Services confirmed the following:
(i)
The impact on
tenants from the proposed redevelopment of Water Lane and Aylesborough Close
was implicit in the 11 October 2012 Community Services Committee report, but
was made more explicit in the report being taken to 17 January 2013 committee
meeting.
(ii)
Noted Labour
Councillors and Tenant Representatives concerns regarding the right to buy
policy. The Council had a right to replace housing stock as of April 2012.
The Business
Manager & Principal Accountant said that under the new right to buy policy,
for any right to buy sales over and above those assumed in the Self-Financing
settlement, the authority is able to retain a proportion that relates to the
debt associated with the dwelling. The authority has also signed an agreement
with Communities & Local government to be able to retain any balance
remaining, as long as it is invested in the delivery of new social housing. The
right to buy receipt can only form 30% of the funding required to build or
acquire a new social housing dwelling, with the balance to be met from Council
resources or through additional borrowing.
The Council
could buy back existing dwellings in the city, but Central Government
encouraged the development of new housing, wherever Councils are in a position
to do so.
The Chair decided
that the recommendations highlighted in the Officer’s report should be voted on
and recorded separately:
The Committee considered and endorsed recommendations (i), (iv), (v), (vi), (vii),
(ix), (x), (xi), (xii) and (xiii) by 8 votes to 1.
The Committee considered and endorsed recommendation (ii) by 4 votes to 0.
The Committee considered and endorsed recommendation (iii) by 3 votes to 0.
The Committee considered and endorsed recommendation (viii) by 4 votes to 0.
The
Executive Councillor noted the recommendations, and deferred considering for approval until the special Strategy & Resources
Committee meeting 15 February 2013.
Conflicts of Interest Declared by the Executive Councillor (and any
Dispensations Granted)
Not applicable.