Issue - decisions

Matter for Decision

As part of the 2023/24 budget process, the range of assumptions upon which the HRA Business Plan and Medium Term Financial Strategy were based, have been reviewed in light of the latest information available, culminating in the preparation of the HRA Budget Setting Report.

 

The HRA Budget-Setting Report provides an overview of the review of the key assumptions. It sets out the key parameters for the detailed recommendations and final budget proposals and is the basis for the finalisation of the 2023/24 budgets.

 

Decision of Executive Councillor for Housing

      i.         Approved that council dwellings rents for all social rented and social shared ownership properties be increased by 5%, recognising that inflation measured by the Consumer Price Index (CPI) at September 2022, plus 1% would result in an increase of 11.1%, that the government has introduced a cap on rent increases at 7% from April 2023, but that a local decision is made to implement a lower rent increase to mitigate the impact on tenants. Rent increases will take effect from 3 April 2023. This equates to an average rent increase of £5.36 per week.

    ii.         Approved that affordable rents, inclusive of service charge, are also increased by 5% in line with the increase for social rents. This equates to an average rent increase of £7.81 per week.

   iii.         Approved that rents for affordable shared ownership properties are increased by 7% or RPI at January 2023 plus 0.5% whichever is the lower, from April 2023, recognising that although the government rent cap does not apply to this tenure, an increase of in excess of 7% may put undue financial pressure on these households.

  iv.         Approved that garage and parking space charges for 2023/24, are increased by inflation at 3%, recognising that although inflation is currently at a higher rate, there is a need to balance increases with the ability to let vacant garages, and that charges for parking permits are reviewed, with any resulting charges summarised in Section 3 of the HRA Budget Setting Report.

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

  vi.         Approved the proposed leasehold administration charges for 2023/24, as detailed in Appendix B of the HRA Budget Setting Report.

 vii.         Approved that caretaking, building cleaning, window 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 services, specialist equipment 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 2022 (10.1%) plus 1%, wherever possible.

viii.         Approved 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 2022/23 of £16,521,190.

  ix.         Approved 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.

    x.         Approved 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.

  xi.         Approved the resulting Housing Revenue Account revenue budget as summarised in the Housing Revenue Account Summary Forecast 2022/23 to 2027/28 shown in Appendix J of the HRA Budget Setting Report.

 

The Executive Councillor recommended Council:

        i.       Approve the revised need to borrow over the 30-year life of the business plan, with the first instance of this anticipated to be in 2023/24, to sustain the proposed level of investment, which includes ear-marking funding for delivery of the 10 Year New Homes Programme.

      ii.        Recognise that the constitution delegates Treasury Management to the Head of Finance (Part 3, para 5.11), with Part 4F, C16 stating; ‘All executive decisions on borrowing, investment or financing shall be delegated to the Head of Finance, who is required to act in accordance with CIPFA’s Code of Practice for Treasury Management in Local Authorities.

    iii.        Recognise that the decision to borrow significantly to build new homes impacts the authority’s ability to set-aside resource to redeem the HRA Self-Financing debt at the point at which the loan portfolio matures, with the need to re-finance debt in the latter stages of the business plan.

iv. Approve capital bids, as detailed in Appendix D (3) and Appendix E of the HRA Budget Setting Report.

v. Approve the latest Decent Homes and Other HRA Stock Investment Programme, to include re-phasing of elements of the programme into later years, as detailed in Appendix E of the HRA Budget Setting Report.

vi. Approve the latest budget sums, profiling and associated financing for all new build schemes, as detailed in Appendices E and H, and summarised in Appendix K, of the HRA Budget Setting Report.

vii. Approve allocation of £10,964,000 of funds from the budget ear-marked for the delivery of new homes into a scheme specific budget for East Road, in line with the scheme specific report presented as part of the committee cycle.

viii. Approve the revised Housing Capital Investment Plan as shown in Appendix K of the HRA Budget Setting Report.

ix. Approve inclusion of Disabled Facilities Grant expenditure and associated grant income from 2022/23 onwards, based upon 2022/23 net grant awarded, 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 any year, 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.

x. Approve delegation to the Head of Finance, as Section 151 Officer, to determine the most appropriate use of any additional Disabled Facilities Grant funding, for the wider benefit of the Shared Home Improvement Agency.

xi. Approve 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 recommendations made by the Shared Home Improvement Agency Board.

xii. Approve delegation to the Strategic Director, in consultation with the Head of Finance, as Section 151 Officer, to draw down resource from the ear-marked reserves 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 deadlines for the use of retained right to buy receipts or to facilitate future site redevelopment.

xiii. Approve delegation to the Head of Finance, as Section 151 Officer, to make any necessary technical amendments to detailed budgets in respect of recharges between the General Fund and the HRA, with any change in impact for the HRA to be reported and incorporated as part of the HRA Medium Term Financial Strategy in September 2023.

xiv. Note the result of the Homes England Compliance Audit in respect of rough sleeper property acquisitions at confidential Appendix M, recognising there is no corrective action to be taken.

 

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.

 

In response to a member question the Executive Councillor advised that rents were proposed to be increased by 5% as they felt this was the appropriate level of increase in the current economic climate. An increase of 7% would be too much. 

 

The Head of Housing Maintenance and Assets noted that funding had been allocated within the budget to pay for works to bring council homes up to Energy Performance Rating (EPC) rating C. Works could include external wall insulation, ventilation upgrades and new windows. Each property would be surveyed and assessed to see what works would be suitable to bring the property up to an EPC C rating. 

 

Councillor Howard introduced the Green and Independent Group’s commentary on the Housing Revenue Account Budget Setting Report.

 

Councillor Porrer introduced the Liberal Democrat Amendment to the 2023/24 Housing Revenue Account Budget Setting Report.

 

Lulu Agate read out a comment on behalf of Tenant Representative Colin Stevens regarding the Liberal Democrat budget amendment papers. Colin felt it was possible to keep homes warm and have an airflow (by opening windows) and by educating people this may reduce the need for repairs and empower people to live in a property in a responsible fashion.  The Housing Ombudsman had carried out research into how best to communicate with tenants about how tenants can better their own situation.

 

Mandy Powell-Hardy noted that if tenants did not report repairs to the Council this could create and exacerbate DMC issues.

 

The Assistant Head of Finance and Business Manager and the Head of Housing Maintenance and Assets said the following in response to Members’ questions:

i.               Advised that there was not an existing backlog in response repairs. There had been a significant underspend during the financial years 2020/21 and 2021/22 during the Covid pandemic period for a variety of reasons. There was not a dedicated officer employed to deal with damp, mould and condensation (DMC) as per the Liberal Democrat Budget amendment. Officers [a surveyor, tenant liaison officer and multi-skilled officer] were currently seconded to deal with DMC issues. Reporting levels for responsive repairs were back to pre-covid levels, but it was noted that these appear to be lower value repairs. It was expected that reporting levels of DMC would reduce during the summer months even if a level of proactive works continued. DMC concerns were also expected to be picked up through the tenancy audits.

ii.             Advised that a surveyor had been seconded from the Void Inspections Team to respond to responsive repair issues and a surveyor from the Responsive Repair Team was covering DMC inspections. A tenant liaison officer was providing administrative support. The was no backlog of work created by the secondments.

iii.            There was not an out of hours service for routine repairs but there was an out of hours service for emergency repairs (24 hours per day 365 days a year). Senior Officers were looking into whether appointments for tenant repairs could be offered outside officer’s contracted working hours of 8-4pm. A discussion with officer’s would be required as potentially changes to officer’s contracts of employment (which specifies certain working hours) would be required.

iv.           The only way to speed up the tenancy audits process would be to put more resource into it to deliver it more quickly. Tenancy audits were undertaken by a number of housing officers but the resource currently equated to one full-time post.      

 

The Liberal Democrat Group amendments were voted on and recorded separately.

 

The following votes were chaired by Diana Minns.

 

1.3 a) A proposal to employ two full time equivalent additional Multi-Skilled Operatives for a fixed period of 2 years (£100,840 per annum), with a view to these posts working specifically to address any backlog in responsive repairs and to avoid future underspends in this budget by giving staff the additional resources required to catch up. These posts will be employed on contracts (full or part time) that support out of hours working to allow the backlog to be addressed in late afternoons, evenings and on Saturdays, thus reducing some of the persistent ‘no access’ issues that have been experienced by the service and which may often be caused by tenants being out at work and not able to allow access during standard working hours.

 

The amendment was lost by 4 votes in favour, 8 against and 1 abstention.

 

1.3 b) A proposal to pilot the potential for the existing workforce to volunteer to work additional hours as overtime in the late afternoons, evenings or on Saturdays to support catching up the backlog, should staff wish to undertake this work. This would supplement the work done by the two FTE additional posts above, and the opportunity to earn overtime pay would be entirely voluntary. A fund of £11,470 is set aside to allow this pilot to proceed. This is equivalent to 300 hours overtime including all on-costs.

 

The amendment was lost by 3 votes in favour, 7 against and 3 abstentions.

 

1.3 c) A proposal to include a revenue bid of £51,840 per annum to employ a dedicated Damp, Mould and Condensation (DMC) Officer. The post would work proactively with data on existing repair requests from tenants and from void inspections to future proof the housing stock across the city against case of damp, mould and condensation. They would deploy mitigation measures to ensure that if one house experiences a problem, the knowledge is rolled out to all similar stock types before future problems arise and ensure that operatives are empowered to treat the root cause and not just the effects of DMC. They would also work with environmental health to educate residents to help reduce risk.

 

The amendment was lost by 4 votes in favour, 6 against and 3 abstentions.

 

1.3 d) A proposal to invest £10,000 in additional consultancy input to complete the energy modelling assessment exercise across the entire portfolio of council housing stock. This would build upon an earlier exercise that was completed for a small proportion of the housing stock as part of submitting a current bid for Social Housing Decarbonisation Grant Funding in the autumn of 2022. Importantly, it would ensure that the data is readily available for future government bids.

 

The amendment was lost by 4 votes in favour to 9 against

 

1.4 a) Amendment to revenue bid B5038 for increased staffing capacity for Housing IT Development, to make the post a two year fixed term post, as opposed to a permanent post. This would reduce costs by £50,930 per annum from 2025/26 onwards, whilst still allowing IT development, improvement and enhancement to take place over the next two years. This fits within the Corporate Transformation timescales and with the proposed review of ICT provision across the council and allows future HRA IT development to align with General Fund provision.

 

The amendment was lost by 2 votes in favour, 8 against and 2 abstentions.

 

b) Amendment to revenue bid B5083 for increased staffing capacity for Service Improvement, to make the post a two year fixed term post, as opposed to a permanent post. This would reduce costs by £59,550 per annum from 2025/26 onwards, whilst still allowing service improvement to be delivered over the next two years. This then fits within the Corporate Transformation timescales and allows for review once the impact of the additional resources from Bids LDB1 and LDB2 has been assessed alongside this post in two years.

 

The amendment was lost by 2 votes in favour, 8 against and 2 abstentions.

 

1.4 c) An increase in garage rents of 5%, as opposed to the 3% currently incorporated into Budget, recognising that this will still impose an increase at a rate far lower than inflation. This will generate additional income of £16,060 per annum and is in line with the current proposals to raise rental income to 5%.

 

The amendment was lost by 5 votes in favour, 6 against and 1 abstention.

 

The Committee resolved:

i.               by 9 votes in favour to 0 against and 3 abstentions to endorse the recommendations a-d

ii.             unanimously to endorse recommendations e-g.

iii.            by 9 votes in favour to 0 against and 3 abstentions to endorse the recommendations h-k

 

The following vote was chaired by Councillor Thittala Varkey.

 

The Committee resolved by 7 votes in favour to 0 against and 1 abstention to endorse recommendations L - y.

 

The Executive Councillor approved the recommendations.

 

Post meeting note

 

An amended version of the Housing Revenue Account (HRA) Budget Setting Report (BSR) was presented to Council on the 23 February 2023 following a number of key changes which arose since Housing Scrutiny Committee had met on the 24 January 2023. The changes are set out in the Housing Revenue Account Budget Setting Report (BSR) 2023/24 to Council. Agenda for Council on Thursday, 23rd February, 2023, 6.00 pm - Cambridge Council. The report amended some of the Executive Councillor for Housing decisions which had previously been taken on 24 January 2023 and the Executive Councillor for Housing recommendations to Council on 23 February 2023. Please refer to the 23 February 2023 Council minutes for the final decisions.

 

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

No conflicts of interest were declared by the Executive Councillor.