Issue - meetings

To consider a report setting out proposals for the Housing Revenue Account 2016/17.

(Report attached)

Members were presented, for recommendation to full Council, with the Initial Budget for the Housing Revenue Account (HRA) and the proposed dwelling rents for 2016/17.  Officers highlighted an error in the Housing Revenue Account Budget 2016/17 at Appendix A to the report, the 2019/20 Balances carried forward figure of which should have stated £20.415m and not £20.145m.

Officers explained the background to the report recommendations and the impact of the 1% rent reduction to be imposed by central government effective from 2016/17.  Over a 30-year period the loss of rent income was estimated at £120.873m, which was almost the same as the £122.158m housing debt, and which would have a significant impact on the HRA Business Plan. 

It was proposed that Officers be instructed to explore ways of balancing the HRA in 2019/20, including rental income from new housing stock and reviewing service charges.  Members proposed an additional recommendation that Officers take to Executive Committee a report setting out the available options in light of the implications on the HRA, such options to include, amongst others, further details in relation to the Council’s previously successful Mortgage Rescue and Buy Back Schemes.

For transparency purposes, Officers highlighted that the indicative costs of the Housing Business Case, which it had been hoped would be referred to Executive that evening but which had been delayed to the February meeting, had been included in report before Members that evening.

RECOMMENDED that

1)          the draft 2016/2017 Budget for the Housing Revenue Account attached to the report at Appendix A be approved;

2)          the four year budget projections 2016/17 to 2019/20, incorporating the 1% rent reduction, be noted and that Officers be instructed to explore ways of balancing the HRA in 2019/20 including rental income from new housing stock and reviewing service charges;

3)          the actual average rent decrease for 2016/2017 be 1% (as per the Welfare Reform and Work Bill 2015/16);

4)          the capital programme for new housing stock be increased from £0.500 million to £1.052 million in 2016/17 and a programme of £1.064m be created in 2017/18 to ensure that all capital receipts retained under the one for one replacement scheme are applied before the deadline;

5)          £2.182 million be transferred to the capital reserve in 2016/17 to fund the future Capital Programme and/or repay borrowing; and

RESOLVED that

6)          Officers take to Executive Committee a report setting out the available options in light of the implications on the HRA, such options to include, amongst others, further details in relation to the Council’s previously successful Mortgage Rescue and Buy Back Schemes.