Issue - meetings

To consider a report by Councillor Hugh Irving, Lead Member for Customers and Communities (copy enclosed) seeking Cabinet agreement of key principles to determine how service charges would be calculated and implemented from rents from April 2015.

RESOLVED that Cabinet agrees the key principles that will determine how service charges will be calculated and implemented from rents from April 2015 onwards as detailed within the report, specifically to –

·        adopt a Variable Charge Policy for apportionment and recovery to all Tenants who receive services, and

·        that individual rents are reduced at year one implementation by the amount of chargeable services that tenants receive, and

that Cabinet notes a further paper will be considered on the final charges as part of the council’s annual council house rent setting process in February 2015.

Councillor Hugh Irving presented the report seeking Cabinet agreement of key principles to determine how service charges would be calculated and implemented from rents from April 2015.  The report had been prepared in response to Welsh Government’s new rent setting policy which required service charges to be separated from tenants’ rental payments to clearly identify what services they were paying for and charges made.

Cabinet considered the options contained within the report in order to meet the requirement and accepted the reasoning behind the recommendation to adopt a variable charge policy to recover service charges and reduce rents for the first year by the amount of chargeable services received.  Councillor Bobby Feeley highlighted the complexity of the process and sought assurances that the changes would be effectively communicated to tenants.  She was particularly concerned about the disproportionate impact upon sheltered complexes which mainly affected older people and how that would be managed.  The Service Charge Officer (SCO) explained that charges would be higher in sheltered schemes due to the costs of maintaining communal areas which would be mitigated in part for those in receipt of housing benefit and by the proposal to reduce the rents in the first year and then follow an uplifting policy.  In response to communication concerns, he agreed to consider further contact with sheltered complexes to clarify matters.  Assurances were sought that the variable approach would not lead to significant cost increases in future years due to undercharging.  The SCO was confident that projections had been accurately calculated, detailing the amount of work undertaken in that regard.  He also confirmed that there was no opt out mechanism for tenants.

RESOLVED that Cabinet agrees the key principles that will determine how service charges will be calculated and implemented from rents from April 2015 onwards as detailed within the report, specifically to –

·        adopt a Variable Charge Policy for apportionment and recovery to all Tenants who receive services, and

·        that individual rents are reduced at year one implementation by the amount of chargeable services that tenants receive, and

that Cabinet notes a further paper will be considered on the final charges as part of the council’s annual council house rent setting process in February 2015.