Agenda item

This report sets out the proposed Housing Revenue Account (HRA) Business Plan, Revenue Budget and Capital Programme for 2023/24.

This report contains the following Annexes:

·         Annexe 1 – HRA 30 Year Business Plan 2023/24 to 52/53

·         Annexe 2 – HRA Business Plan Movements 2023/24

·         Annexe 3 – HRA Key Budget Variances 2023/24

·         Annexe 4 – HRA Fees & Charges

·         Annexe 5 – HRA Capital Programme

·         Annexe 6 – Housing Delivery Programme

·         Annexe 7 – HRA Reserves Statement

·         Annexe 8 – HRA Contracts over £100k

Recommendation

It is recommended that the Executive, after considering the comments from the Resources Overview and Scrutiny Committee, makes the following recommendations to Council, that:

1.    the rent level for Council dwellings be increased by up to 4% from the 22/23 level with effect from 1 April 2023 within the permitted guidelines contained within the Government’s rent setting policy;

2.    the service charges in senior living accommodation be increased by4% per week from 1 April 2023 to £20.90;

3.    the recharge for energy costs in HRA properties be increased by 4% per week from 1 April 2023;

4.    the revised HRA Business Plan for 2023/24 to 2053/54 as set out in Annexe 1 be approved;

5.    the approval change for the fees and charges as set out in Annexe 4 is noted

6.    the Housing Revenue Account Capital Programmes as shown in Annexe 5 & Annexe 6 be approved; and,

7.    the financing of the capital programmes be approved in line with the resources shown in Annexe 7.

8.    to deliver the works identified in the maintenance budgets it is recommended that authority is delegated to the Executive Head of Housing, in consultation with the s151 Officer, to procure and enter into contracts valued over £100,000 shown in Annexe 8

The Executive RESOLVED to recommend to Council that:

1.    the rent level for Council dwellings be increased by up to 4% from the 22/23 level with effect from 1 April 2023 within the permitted guidelines contained within the Government’s rent setting policy;

2.    the service charges in senior living accommodation be increased by4% per week from 1 April 2023 to £20.90;

3.    the recharge for energy costs in HRA properties be increased by 4% per week from 1 April 2023;

4.    the revised HRA Business Plan for 2023/24 to 2053/54 as set out in Annexe 1 be approved;

5.    the approval change for the fees and charges as set out in Annexe 4 is noted

6.    the Housing Revenue Account Capital Programmes as shown in Annexe 5 & Annexe 6 be approved; and,

7.    the financing of the capital programmes be approved in line with the resources shown in Annexe 7.

8.    to deliver the works identified in the maintenance budgets it is recommended that authority is delegated to the Executive Head of Housing, in consultation with the Co-Portfolio Holders for Housing and the s151 Officer, to procure and enter into contracts valued over £100,000 shown in Annexe 8.

Reason: In order to approve the use of reserves and resources to fund Waverley Borough Council’s Landlord Services, the 30 year maintenance programme, deliver proposals for building new affordable homes and stock remodelling.

[This matter is recommended to Full Council for decision.]

The Portfolio Holder for Finance, Commercial and Assets, Cllr Mark Merryweather, presented the report which set out the proposed budget and capital programme for the Housing Revenue Account (HRA), which was the ring-fenced account entirely funded by council house rent income to meet the annual cost of operating, administering and maintaining council homes as well major repairs and upgrades, building new affordable homes, and servicing the legacy £189m mortgage the Council was required to take out in 2012 to transfer the HRA to a self-financing basis.

The HRA was self-financing and the annual budget had to balance. The rolling 30-year business plan had been reviewed during 2022/23 and in December 2022, Council had agreed to revise the mortgage debt strategy to rephase net repayments and free up rent income in the short-term to fund housing maintenance and the energy efficiency programme.

The net impact of inflation on costs in 2023/24 was estimated at around £1.1m and this had been part of the careful consideration of the appropriate level of rent increase. On balance, the Executive proposed a 4% increase in rents, service charges and energy recharges in 2023/24. Higher and lower rates of increase had been considered, and while 4% was felt to be fair, the Portfolio encouraged Council to consider and debate this fully.

The final recommendation, to delegate certain authority for work in the maintenance budget was considered beneficial for the delivery of the works identified.

Cllr Merryweather again thanked Officers for their work in developing the HRA budget over many weeks.

Cllr Jerry Hyman spoke on this item and noted that on Annexe 5, the budget for sewerage works would end after 2023/24. He also noted that the stock condition survey had been promised for many years and was desperately needed to plan works required for council housing stock.

The Leader advised that the cost for ongoing sewerage works would be met from the revenue budget rather than the capital budget. The Co-Portfolio Holder for Housing (Operations), Cllr Paul Rivers, advised that the council held a great deal of data about its housing stock, but recognised the need for a comprehensive stock condition survey to update records, and the procurement of a contractor was at an advanced stage.

In moving the recommendation, the Leader advised an amendment to recommendation 8, to include the Co-Portfolios for Housing in the delegation arrangements.

The Executive RESOLVED to recommend to Council that:

1.    the rent level for Council dwellings be increased by up to 4% from the 22/23 level with effect from 1 April 2023 within the permitted guidelines contained within the Government’s rent setting policy;

2.    the service charges in senior living accommodation be increased by 4% per week from 1 April 2023 to £20.90;

3.    the recharge for energy costs in HRA properties be increased by 4% per week from 1 April 2023;

4.    the revised HRA Business Plan for 2023/24 to 2053/54 as set out in Annexe 1 be approved;

5.    the approval change for the fees and charges as set out in Annexe 4 is noted

6.    the Housing Revenue Account Capital Programmes as shown in Annexe 5 & Annexe 6 be approved; and,

7.    the financing of the capital programmes be approved in line with the resources shown in Annexe 7.

8.    to deliver the works identified in the maintenance budgets it is recommended that authority is delegated to the Executive Head of Housing, in consultation with the Co-Portfolio Holders for Housing and the s151 Officer, to procure and enter into contracts valued over £100,000 shown in Annexe 8.

Reason: In order to approve the use of reserves and resources to fund Waverley Borough Council’s Landlord Services, the 30 year maintenance programme, deliver proposals for building new affordable homes and stock remodelling.