Agenda item

To receive a presentation outlining the HRA budget.

The Committee had received a briefing prior to the meeting on the HRA to better understand the complexities of the budget.  Lindsay Kennedy introduced herself and advised she had redesigned the business plan and drawn up the HRA budget.

Members had queried in the briefing what efficiencies had been made by the Housing team.  Lindsay Kennedy advised that there were a large amount of high value spends going out from the HRA and these were put up to tender so we were getting value for money on these contracts.  Various efficiencies have been implemented over the area and contractors were regularly challenged over charge increases.

It had been raised that the rent increase proposed was above the rate of inflation and may be unaffordable to some.  It was explained that due to the Government’s ruling that rents must decrease by 1% each year for the last 4 years this had caused a deficit which needed to be ‘clawed’ back.

Some Members advised they had been frustrated by the rent decrease and that they felt a 2.7% rise was not unreasonable.  The Tenant Panel members suggested that it would be helpful for tenants if they knew where this money was spent. 

It was pointed out that the Council was dedicated to providing ‘affordable’ housing and that if we put up rents at a faster rate than inflation then the rents would not be ‘affordable’.  It was also pointed out that as 2019-2020 was a 53 week year this meant that a 2.7% increase pa meant a 5% increase weekly as this year would be split over 52 weeks.

Officers were asked to explain why, when the budget sheet showed good reserves,  we were looking to raise rents by so much. It was suggested we could make efficiencies by cutting out the ‘Back funding Pension Cost’; however, Graeme Clark advised this was a statutory charge and not in our power to not pay.  He explained it was a balancing act and that the balance sheet only showed 4 years.  The reserves would eventually run out.

Members were advised that many tenants had built up a credit on their rent accounts by not reducing their payments over the 4 year period and thus it was felt the rent increase was affordable.  It was also pointed out that if the rents had not reduced by 1% each year (over last 4 years) the rent was likely to have been similar if not more than the 2.7%.

The Chairman highlighted that in the draft capital program there were a lot of projects coming up but no indication of a budget to support this.  Andrew Smith advised that this was in the service plan discussed earlier in the meeting. 

The chairman asked that paragraph 23 of the report be strengthened as the Climate Change Emergency needed more weight applying.

It was felt that paragraph 26 was a little one sided and there should be a cap to the level of delegation allowed.  There should be a differentiation between a tactical need and a strategic need.

The committee then voted on the recommendations set out in the report.

Recommendation:

1.    AGREED with a majority vote (1 vote against)

2.    AGREED with a majority vote (1 abstention)

3.    AGREED with a majority vote (1 abstention)

4.    AGREED unanimously

5.    NOTED

6.    NOTED

7.    AGREED subject to the addition of leaseholder charges being added to annexe 3 which had been omitted.

8.    AGREED unanimously

9.    AGREED unanimously

10.  Officers to re-word this recommendation and send to Chairman to be circulated for agreement.

At 9.25pm the committee were advised that procedure rules stated that committees should not proceed for more than 30 minutes over the allotted time slot without a vote being taken as to whether to conclude the agenda or reconvene at a later date.  A vote was taken and it was AGREED to continue to the conclusion of the agenda.