Issue - meetings

To consider a recommendation from Cabinet in respect of the Housing Revenue Account Business Plan 2020-21.

Further to Minute No. 88 of the meeting of the Cabinet held on 23^rd December, 2019, consideration was given to the report in respect of the Housing Revenue Account Business Plan 2020-21.

The Housing Revenue Account (HRA) recorded all expenditure and income relating to the provision of Council housing and related services, and the Council was required to produce a HRA Business Plan setting out its investment priorities over a thirty year period.

Following the introduction in 2012 of HRA self-financing, the Council was awarded control over its HRA in return for taking on a proportion of national housing debt.

Since the last update there have been no significant Government policy changes that affect the business plan. That said there were still some policies that have impacted on the plan:-

·                Roll out of full service Universal Credit to all remaining working age tenants in Rotherham since July 2018 onwards.

·                Ongoing Right to Buy eligibility.

·                Updated Guidance on Social rents permitting increases of CPI + 1% from 2020-21 onwards.

The Business Plan, therefore, recognised the importance of continuing investment in new affordable homes, focused on the next five years and would continue to be amended and reported annually. Given the economic uncertainty the overall position remained challenging, but given the level of reserves and the previous decision to defer some investment in stock until later in the Plan the ability to divert resources to fund housing growth and contribute to the Council Plan remained.

A detailed technical overview was provided of the current position and the reason for changes to the Business Plan and this report was to be considered alongside the proposed 2020-21 rents, service charges and budgets.

The priorities in the Housing Growth Programme over the next five years were:-

·           Developing 171 new homes in the town centre.

·           Piloting modern methods of construction in order to ascertain the potential to build homes at an increased pace and lower cost.

·           Delivering more shared ownership homes to enable first time buyers and older people wishing to downsize, to own an affordable home.

·           Continuing to build bungalows and other accessible accommodation to enable older people and people with support needs to live independently.

·           Releasing HRA owned sites for development by the private sector and housing associations.

Councillor Carter supported the sentiments of the report, but asked how greenfield sites could be protected.  He was advised and information shared about the strategic acquisition programme, the use of Section 106 Agreements and the development of housing with significant market discounts in order to deliver high quality homes across the Borough including a large proportion which would be added to the Council’s housing stock.

Councillor Beck recapped over the town centre housing programme delivering 177 new homes across three sites for those Members that sought clarification; former Henleys Garage, Millfold House on Westage and Sheffield Road car park.  This would deliver a mixture of tenures with homes for Council rent, some for shared ownership and some open market sales to sell to people to  ...  view the full minutes text for item 291

Report of the Strategic Director of Adult Care, Housing and Public Health

Recommendations:-

That Cabinet resolves to recommend to Council:

1.    That the proposed 2020-21 Base Case Option 3 for the Housing Revenue Account Business Plan be approved.

2.    That the plan be reviewed annually to provide an updated financial  ...  view the full agenda text for item 88

Consideration was given to a report which provided a detailed technical overview of the current position of the Housing Revenue Account (HRA) Business Plan and the reasons for changes to the plan.

It was reported that the Housing Revenue Account recorded all expenditure and income relating to the provision of  ...  view the full minutes text for item 88

Cabinet Portfolio:                 Housing

Strategic Directorate:           Adult Care, Housing and Public Health

Consideration was given to a report presented for pre-decision scrutiny ahead of the Cabinet meeting scheduled for 23 December 2019, which provided a detailed technical overview of the current position of the Housing Revenue Account (HRA) Business Plan and the reasons for changes to the plan.

It was reported that the Housing Revenue Account recorded all expenditure and income relating to the provision of council housing and related services, and the Council was required to produce a HRA Business Plan setting out its investment priorities over a 30 year period. Following the introduction in 2012 of HRA self-financing, the Council was awarded control over its HRA in return for taking on a proportion of national housing debt.

It was noted that since the last update to the plan, there had been no significant government policy changes that affected the business plan, however there were still some policies that had impacted on the plan:

·         Roll out of full service Universal Credit to all remaining working age tenants in   Rotherham since July 2018 onwards

·         Ongoing Right to Buy eligibility

·         Updated Guidance on Social rents permitting increases of CPI + 1% from 2020-21 onwards.

The Business Plan recognised the importance of continuing investment in new affordable homes, focused on the next five years and would continue to be amended and reported annually. Given the economic uncertainty the overall position remained challenging, but in view of the level of reserves and the previous decision to defer some investment in stock until later in the plan the ability to divert resources to fund housing growth and contribute to the Council Plan remained.

Members noted that, over the short to medium term forecast, the Business Plan showed a sustainable level of cash flow and balances; however over the longer term there would be a significant squeeze on resources due to inflationary pressures. It was further noted that the key risks in the Business Plan were increased Right to Buy sales above those planned for, interest rate rises above those planned and inflation. Those risks were monitored continuously and mitigated by the Housing Service with support from Financial Services.

Concerns were expressed that the level of rent arrears that had been amassed by claimants of Universal Credit and assurances were sought that the authority was responding positively to assist those individuals. In response, it was there were more officers were working closely with the Department of Work and Pensions (DWP), the government agency responsible for the delivery and implementation of Universal Credit, to mitigate the issue. In addition, officers were also working closely with Rotherham Citizens Advice Bureau and with colleagues in Neighbourhood Services. It was noted that approximately 2,500 tenants were also claimants of Universal Credit and the predictions in respect of bad debts against the HRA were better than forecast, but the arrears issue remained a significant challenge. Following on, the Cabinet Member for Housing confirmed that a political decision was taken to invest in the financial inclusion team in preparation for the impact of  ...  view the full minutes text for item 97