Agenda item

To consider and approve the Housing Revenue Account Rents and Service Charges 2026-27.

Further to Minute No. 90 of the meeting of Cabinet held on 15 December 2025, consideration was given to the report which sought approval for the Housing Revenue Account Budget for 2026/27 and proposed increases in housing rents, non-dwelling rents and other service charges. It was proposed that Council dwelling rents be increased by 4.8%.

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 an HRA Business Plan setting out its investment priorities over a 30-year period.

From the 1 April 2026, the Government would implement a 10-year social rent settlement. This was the Government's Policy on the annual increase for social housing rents. The 10-year settlement set the maximum rent increase at the Consumer Price Index (CPI) as of September the year prior plus 1%. The 10-year rent settlement had given greater certainty on the level of forecast income to fund the HRA Business Plan, going forward. It would enable longer term planning for investment, delivery of services and growth. The rent settlement was part of the Government’s plan for the future of social housing which promised to enable local authorities and housing associations to deliver thousands of new affordable homes to meet need and drive up the safety and quality of existing homes.

The proposed 2026/27 HRA Business Plan incorporated the Council’s commitments to continue and extend the Council’s Housing Delivery Programme, alongside significant additional investment to support decency and thermal efficiency in existing council homes. The Plan included provision for £1.329bn investment in the housing stock over 30 years, an increase of £350m compared to the 2025/26 plan. This was alongside continuing to fund day-to-day housing management, repairs and maintenance costs. £122.9m would be invested to deliver an estimated 500 further Council homes by 2037/38, in addition to the £90.9m that was earmarked to support the current Housing Delivery Programme which is on track to deliver 1,000 homes by summer 2027.

Alongside providing the draft HRA budget for 2026/27, the report recommended proposed levels for housing rents, non-dwelling rents, District Heating charges and other service charges for 2026/27. It was recommended to Council that dwelling rents be increased by 4.8% and up to £2 per week (equivalent to CPI+1% and up to £2 per week rent convergence). This was dependent upon a Government decision expected in January 2026, which would clarify the approach to social rent convergence.

During the meeting, the Cabinet Member explained that a correction to Appendix 4 was required. It stated that Garage rents would be increased from £6.56 per week to £6.76 per week for Council Tenants. It should have stated that the rent would increase to £7.21 (10%) as correctly stated in paragraph 2.7.23 of the main report. Similarly, the Garage rents for non-Council Tenants line in Appendix 4 should have stated that rents had been increased by 10%, from £7.88 to £8.67, as correctly stated in the report.

Some members expressed concerns regarding rent convergence. Others supported the ambition in the business plan and were supportive of proposals to build a further 500 homes on top of the 1000 Council homes already planned. The Cabinet Member agreed to raise the issue of off-road parking for Council homes and the distribution of HRA funds in a meeting with officers. Members on all sides of the Chamber had praised the Cabinet Member for the work she had done since taking over the Housing Portfolio. 

Resolved:

That Council:

1.    Approve the proposed 2026/27 HRA Business Plan.

2.    Note that the Business Plan will be reviewed annually to provide an updated financial position.

3.    Agree that Council dwelling rents are increased by 4.8% and, dependent upon the Government announcement in January 2026, implement a policy of rent convergence. Allowing rents for social housing properties that are currently below the Government-calculated formula rent to increase by an additional £2 per week in 2026/27. If convergence is capped below £2 that will be the level applied.

4.    Agree that the Council should retain the policy of realigning rents on properties at below formula rent to the formula rent level when the property is re-let to a new tenant.

5.    Agree that affordable rents are calculated at relet, based on an individual property valuation.

6.    Agree that affordable rents are increased by 4.8% in 2026/27.

7.    Agree that shared ownership rents are increased by 5% in 2026/27.

8.    Agree that charges for communal facilities, parking spaces, cooking gas and use of laundry facilities are increased by 3% in 2026/27.

9.    Agree that charges for garages are increased by 10% in 2026/27.

10. Agree that the District Heating unit charge per kWh remains at 13.09 pence per kWh.

11. Agree that the decision to reduce the price of District Heating Charges during 2026/27 be delegated to the Service Director of Housing in conjunction with the Service Director of Financial Services following consultation with the Cabinet Member for Housing. The delegation would only be used to respond to a change in Government policy or a significant change in the Ofgem price cap that has the effect of a lower unit price.

12. Approve the draft Housing Revenue Account budget for 2026/27 as shown in Appendix 8.

Mover: Councillor Beresford                              Seconder: Councillor Alam

Councillor Bennett-Sylvester requested that his vote in favour of the resolutions be minuted.

Councillor Bennett-Sylvester and Councillor Harper declared a disclosable pecuniary interest in Minute No. 109 (HRA Business Plan, Rent Setting and Service Charges 2026-27) on the grounds of being a Council tenant and having a partner who was a Council tenant respectively and were granted a dispensation to vote.

Councillor Cusworth declared a non-pecuniary interest in Minute No. 109 (HRA Business Plan, Rent Setting and Service Charges 2026-27) on the grounds that a family member was a Council tenant. She remained in the chamber and voted on the matter.