Agenda item

Key Decision - Draft HRA Budget 2014/15, Draft MTFS 2015/16 to 2017/18, Draft HRA Capital Budget 2014/15 to 2017/18

Joint Report of the Corporate Director of Community, Health and Wellbeing and Resources.

Decision:

RESOLVED: That

(1) the draft HRA Budget be approved for consultation;

(2) the proposed increase of 5.1% to housing rent charges for 2014/15, resulting in an average rent of £112.43 per week for 2014/15 be approved for consultation;

(3) the proposed increases in facility and water charges set out in appendices 4 and 5 to the report be approved for consultation;

(4) the draft four year Capital Programme be approved for consultation;

with final approval being sought from Cabinet and Council in February 2014;

(5) the government’s proposals to change national rent policy from 2015/16 onwards be noted.

Reason for Decision: To publish the draft HRA Budget and Capital Programme for consultation.

Alternative Options Considered and Rejected: As set out in the report.

Conflict of Interest relating to the matter declared by Cabinet Member / Dispensation Granted: None.

Minutes:

The Portfolio Holder for Adults and Housing introduced the report, which set out the Draft Housing Revenue Account (HRA) Budget for 2014/15 and the Medium Term Financial Strategy (MTFS) for 2015/16 to 2017/18. He added that the HRA was in ‘good health’ since the introduction of the reforms by government, as it allowed Councils to do more to improve the quality of their estates. He explained that the Retail Price Index (RPI) was 3.2% in September, which had resulted in a proposed average rent increase of 5.1% for 2014/15. There would be no increase in garage rents pending finalisation of the Garage Strategy Review. Additionally, a proposal from the Tenants’, Residents’ and Leaseholders’ Consultative Forum (TLRCF) meeting held on 11 December 2013 to introduce a pilot scheme in which estate residents and voluntary groups paid a reduced rate for hire of community halls would be explored and reflected in the budget.

The Portfolio Holder responded to questions from the non-voting non?Executive Cabinet Members who asked about his involvement in the HRA Budget process. He explained that he had taken a longer term view at the nature of the HRA, including how the Capital Work Programme and that the structure of the debt was being maintained. Additionally, it was important the double-entry system was done on a 4-year basis/programme cycle and he intended to roll this out in order to save money.

A non-voting non-Executive Member enquired about the Portfolio Holder’s vision as he felt that the report did not set out a strategic view and the key priorities, including how stakeholders would be consulted. The same Member referred to recent government announcements on the Right to Buy Scheme and enquired about its impact on the HRA. The Portfolio Holder replied, as follows:

· the TLRCF had been consulted the previous evening, which he had reported upon;

· the impact on the HRA was difficult to predict and was dependant on the change in relation to the Retail Price Index (RPI) and the Consumer Price Index (CPI) as future rent increases would be based on the CPI;

· there was a need to lobby the government to ensure better outcomes, and look at revaluing the housing stock and abolish the cap imposed. Currently, there was a requirement to service the debt;

· he was examining ways in which there would be a sharing of services, including the carrying out back office functions for Housing Associations. Additionally, new build schemes were being explored, including the leveraging of money by working with other organisations, as it would help to finance the remainder of the development and increase the income stream.