Agenda item


To consider and approve the proposed 2023-24 Base Case Option 1 for the HRA Business Plan.



Further to Minute No. 123 of the meeting of the Cabinet held on 13 February 2023, consideration was given to the report which explained that the Council was required to produce a Housing Revenue Account (HRA) Business Plan setting out its investment priorities over a 30-year period. The report also provided a detailed technical overview of the current position and the reason for changes to the Business Plan.


The report was also considered alongside the Housing Revenue Account Rents and Service Charges 2023/24.


The council was required to produce an annual business plan that covered a 30-year period. The plan was refreshed annually. The key priorities that influenced the plan remained largely as they were previously. These were:


·      Investing in future housing growth.

·      Replacing homes lost through Right to Buy.

·      Maintaining Decent Home standards and service standards.

·      Ensuring compliance to statutory functions, part of which was achieving energy performance C across the housing stock.

·      Sustaining the current levels of investment in front line services.

·      Safeguarding and supporting the most vulnerable tenants.


A critical consideration of the plan was to set the rents at a level to enable the Council to meet those priorities and ensure long term viability over the plan.


A significant change that the plan responded to this year was the national introduction of the social rent cap had set rents at a maximum of 7%.  The report was very clear on what could and could not be achieved.  The proposed way forward meant there would be no cuts to existing housing stock, there would be no reduction to current build standards, there would be continued delivery of new homes to replace those lost through right to buy.


The proposal within the report was that dwelling rents were increased by 7% which included shared ownership. A 6% increase to service charges, which included garages and parking. District heating costs were proposed to in-line with national Government’s proposed dual fuel cap.


It was recommended to support the proposals presented at the meeting.


In seconding, the reports Councillor Allen explained the Council was legally required to review rents and make such changes as required. The circumstances everyone found themselves in were significant, challenges from increasing gas and electricity costs and high inflation. The Authority had a duty to balance the financial considerations as affected by those considerations and then impact on tenants. Under the proposal of a 7% increase, the average weekly rent would increase by £5.54 per week.


The Council had 19,807 properties and 16,227 of those households, who were in receipt of benefits would not be directly affected by those rent increases. Similarly on the district heating charges, there was an increase, but the increase would remain within parameters that all other tenants were experiencing. She explained that there were some drop-in sessions planned for residents to talk about what support was available around the district heating charges.


She explained that other options had been considered. A 5% increase had been considered. The difference between a 5% and a 7% increase was significant. If the Council levied a 5% increase it would not raise enough income to cover inflationary costs, it would mean that the Council would be able to deliver far less in terms of affordable housing and it would be delivered to a lower specification. A 7% increase gave the Council the ability to deliver a further 140 houses, bringing the total to around 700 in the years up to 2029.  It also allowed continued investment in housing growth and allowed achievement of the energy rating across the borough and to maintain the work carried out on decent home standards. It also allowed the Council to sustain current levels of investment in frontline services.


The business plan was about promoting growth rather than managing decline and it was for that reason she was seconding the proposals of the two reports.


Resolved: That Council:

1.    Approved the proposed 2023-24 Base Case Option 1 for the HRA Business Plan.

2.    Reviewed the Plan annually to provide an updated financial position.


Moved by: Councillor Brookes                           Seconded by: Councillor Allen


Supporting documents: