Agenda item

To consider a report by Councillor Hugh Irving Lead Member for Customers and Communities (copy enclosed) on the Housing Revenue Account and Capital Budgets 2013/14.

Councillor H.C. Irving presented the report which sought approval for the Housing Revenue Account Revenue and Capital Budgets for 2013/14.

RESOLVED:- that

(a)   the Housing Revenue Account Budget for 2013/14, Appendix 1, and the Housing Stock Business Plan, Appendix 2, be adopted.

(b)   rents for Council dwellings be increased in accordance with the Rent Setting Policy guidance from Welsh Government with effect from Monday, 1st April 2013, and

(c)    rents for Council garages and Heating Charges be increased in line with Guideline Rents with effect from Monday 1^st April 2013.

Councillor H.C. Irving presented the report which sought approval for the Housing Revenue Account Revenue and Capital Budgets for 2013/14.

Councillor M.Ll. Davies declared a personal interest as he rented a garage form the Council.

Councillor Irving introduced the report and explained that the budget for 2013/14 would need to be set to conform with the Housing Stock Business Plan (HSBP) established when the Council decided to retain its housing stock and fund improvements to reach WHQS by the end of 2013 and maintain it until 2041.  The latest forecast out-turn had been detailed in Appendix 1 and balances at year end had been forecast to be £857,000, an improvement of £17k when compared to the December, 2012 forecast out-turn.  The proposed budget for 2013/14 had been detailed in Appendix 1.

The Chief Accountant (CA) summarised the process for calculating the budget, which had been outlined in the report, and the Final HRA Subsidy Determinations were imminent.  The Determination governed the negative subsidy paid to Welsh Government annually and it was assumed that “Guideline Rents” were charged, “Management and Maintenance” costs were fixed and older supported capital repayments were made.  The “notional” HRA account produced from the calculation was in surplus and paid to Welsh Government and then to the Treasury as negative subsidy.  It was unlikely that there would be any significant change to the Housing Revenue Account Subsidy System until 2014.  Welsh Government had indicated that it would be suspending the rent convergence policy for another year and reducing the Guideline Rent to 1% above the September, 2012 inflation figure and this had resulted in the following recommendations from Welsh Government:-

·         Management and Maintenance allowances to be uplifted by 6.6% to £2,610 compared to £2,267 per dwelling in 2012/13.

·         Guideline Rent increases to £69.45 per dwelling per week which equated to a weekly increase of £3.37 or 5.18% increase.

·         Benchmark Rents (RSL) would increase to £75.21 from £72.95, an increase of £2.26 equating to 3.10% uplift.

The estimated HRA Subsidy payment to Welsh Government for 2013/14 would total £3,243,000, an increase of 5.3% compared with 2012/13.  Details of the work undertaken by Housing Services on scoping the impact of welfare reform and developing strategies to manage and mitigate the risks associated with it had been summarised in the report.  The Corporate Director: Modernising and Wellbeing confirmed that all affected tenants would be supported with housing options advice and the service had been restructured to create a bespoke income management function to develop a more pro-active and interventionist approach to manage and mitigate the risks of increased arrears as a result of wider welfare reforms.  It had been recommended that all tenants pay the Guideline Rent uplift for 2013/14 and a summary of the charges being applied to the stock had been provided in the report.

The Community Housing Manager (CHM) explained that the Housing Stock Business Plan (HSBP) would be monitored and a Due Diligence exercise would be undertaken on an annual basis.  The latest review confirmed that many of the original assumptions remained unaltered and concluded that the Business Plan was both viable and robust and the plan would be viable over the next 30 years.

It was explained by the CHM that the 2012 stock condition survey had identified a need for significant additional expenditure over the next 30 years ranging from £50million to £33 million.  The plan would be viable over the 30 year period with balances rising from £43 million from the original Savills survey to £52 million when taking account the stock investment requirements through the Rands Survey.  The Capital Programme for 2013/14 would consist of completing the framework contracts so that all properties would meet WHQS and the total cost of capital works for 2013/14 would be in line with the Housing Stock Business Plan.  Details of heating charges, garage rents and contractor appointments, framework agreement had been included in the report

In reply to questions from Councillor R.L. Feeley, the CHM provided details of the implications relating to the introduction of welfare reform.  He referred to the restructure process being undertaken which incorporated projects being implemented in respect of garages and home heating systems.  The Leader emphasised the importance of maintaining a consistent approach by the Authority and Voluntary Sector, regarding information provided to the public in relation to the welfare reform.

During the ensuing discussion, the CHM agreed to provide a response to concerns raised by Councillor J. Butterfield regarding rental parity between the North and South of the County.

RESOLVED:- that

(a)   the Housing Revenue Account Budget for 2013/14, Appendix 1, and the Housing Stock Business Plan, Appendix 2, be adopted.

(b)   rents for Council dwellings be increased in accordance with the Rent Setting Policy guidance from Welsh Government with effect from Monday, 1st April 2013, and

(c)    rents for Council garages and Heating Charges be increased in line with Guideline Rents with effect from Monday 1^st April 2013.