Agenda item

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

Recommendations:-

That Cabinet recommends to Council to:-

1.           Approve the proposed 2021-22 Base Case Option 1 for the HRA Business Plan.

2.           Approve the reprofiling of housing growth budgets to ensure resources are available at the right time to deliver on the annual housing development programme commitments as set out within paragraph 1.6 of the report.

3.           Review the plan annually to provide an updated financial position.

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

It was reported that the 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 30-year period.

It was noted that there had been no significant Government policy changes that affected the business plan since the last update but there were some significant changes to the Consumer Price Index as a consequence of the COVID-19 Pandemic. This had resulted in the CPI being 1.5% lower than predicted when the Plan was last reviewed.

The Business Plan recognised the importance of continued investment in new affordable homes, focus 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 Year Ahead Plan remained.

The Business Plan operating account was at or around the minimum balance over the short to medium forecast. However, due to inflationary pressures, there was significant pressure on the longer term forecast. The key risks in the Business Plan were increased Right to Buy sales above those planned for, interest rate rises above those planned for and inflation. The risks were continuously monitored and mitigated by the Housing Service with support from Financial Services.

The Cabinet Member for Housing confirmed that £114 Million including grant income had already been, and would continue to be, invested in the Housing Growth Programme which supported the building of new affordable housing, shared ownership housing and open market housing. All projects not yet agreed would be subject to future Cabinet approval. There was also a focus on maintaining the existing Council Housing stock to the agreed standard and it was anticipated that over £1 Billion would be spent to achieve this over the course of the 30 year Plan. The Cabinet Member also confirmed that the Arundel Avenue and Braithwell Road schemes had been redesigned to deliver 14 bungalows rather than 12 as previously agreed.

Cabinet Members were very supportive of the Business Plan and expressed their pride at being able to deliver additional, high quality Council homes.

The report had been considered by the Overview and Scrutiny Management Board as part of the pre-decision scrutiny process. The Board expressed their support for the recommendations and requested that a sub-group of the Overview and Scrutiny Management Board be established to feed into the work being carried out to develop housing on garage sites.

Resolved:-

That Cabinet recommends to Council to:

(1)  approve the proposed 2021-22 Base Case Option 1 for the HRA Business Plan;

(2)  approve the reprofiling of housing growth budgets to ensure resources are available at the right time to deliver on the annual housing development programme commitments as set out within paragraph 1.6 of the report;

(3)  review the plan annually to provide an updated financial position; and

(4)  That Cabinet agrees that a sub-group of the Overview and Scrutiny Management Board be established to feed into the work being carried out to develop housing on garage sites.