Issue - meetings

Decision:

To note the final outturn position and to endorse the decision, taken under delegated authority, to transfer £2.5 million to the reserve for future capital, and £5.26 million to the new build reserve from the revenue surplus of £7.76 million in 2022-23.

Reason:

To allow the Statutory Statement of Accounts to be finalised and subject to external audit prior to approval by the Council.

Other options considered and rejected by the Executive:

None.

Details of any conflict of interest declared by the Leader or lead councillors and any dispensation granted:

None.

The Housing Revenue Account (HRA) was a separate ringfenced account that recorded all the income and expenditure associated with the provision and management of Council-owned residential dwellings and other properties in the Borough.  The requirement to maintain a Housing Revenue Account was set out in the Local Government and Housing Act 1989 and the requirements to publish final accounts was set out in the Accounts and Audit Regulations 2003.

The Leader and Lead Councillor for Housing introduced the report.

The Executive heard that the outturn report set out a surplus for the year of £7.76m. This was £3.12m less than the budgeted surplus of £10.89m. The reconciliation was set out in paragraph 7.4. The variance was made up of three parts: Higher total expenditure net of revaluation movements resulted in £3.5m overspent predominantly in repairs and maintenance; rental income was lower by £1m due to voids and increasing interest rates.

The surplus had been transferred to two reserves. A contribution of £2.5m to the reserve for future capital and a contribution of £5.26m to the New Build reserve.  The HRA working balance at year-end remained at £2.5 million.

HRA capital expenditure totalled £26.3m against an original budget of £53.9m. Of this expenditure, major repairs totalled £20.3m against a budget of £24.5m. Provision of new housing was £6m expenditure against a budget of £27.5m due to delays of progression of schemes in the programme.

The Executive,

RESOLVED:

To note the final outturn position and to endorse the decision, taken under delegated authority, to transfer £2.5 million to the reserve for future capital, and £5.26 million to the new build reserve from the revenue surplus of £7.76 million in 2022-23.

Reason:

To allow the Statutory Statement of Accounts to be finalised and subject to external audit prior to approval by the Council.

The Committee considered a report on the Housing Revenue Account (HRA) final accounts for 2022-23. The HRA recorded all the income and expenditure associated with the provision and management of Council owned residential dwellings in the Borough. The requirement to maintain a HRA was set out in the Local Government and Housing Act 1989 and the requirement to publish final accounts was set out in the Accounts and Audit (England) Regulations 2015.

The report had set out the actual level of revenue spending on day-to-day services provided to tenants and recorded in the HRA in 2022-23. The operating surplus for the HRA in 2022-23 had been £3.12 million less than the budgeted surplus of £10.89 million (Section 7.5) at £7.76 million.  The outturn allowed a contribution of £2.5 million to the reserve for future capital and a contribution of £5.26 million to the New Build reserve.  The HRA working balance at year-end remained at £2.5 million.

The Chief Finance Officer, in consultation with the Leader of the Council and Lead Councillor for Finance and Property had usedtheir delegated authority to make the necessary transfers to reserves. This continued the policy adopted in previous years, whereby the year-end surplus was applied to each of the two reserves referred to above.

The HRA capital programme had budgeted expenditure of £53.9 million with an actual spend of £26.3 million.  There had been £24.5 million of major repairs estimated with an outturn of £20.3 million.  £27.05 million had been budgeted for new developments, where actual expenditure had been £6 million due to delays in the progression of some of the new schemes.

During the debate, the Committee made the following comments:

·      In response to a question, the interim Section 151 Officer confirmed that the figures in the report represented all the HRA expenditure both in terms of revenue and capital incurred in 2022-23, including the unbudgeted sums in relation to housing maintenance. There were, however, outstanding orders and other work that was ongoing, which were not included in those figures, but would be included in the current year's figures.

·      Whilst the Committee could be reassured that the figures represented what had actually been spent, it could not at this point be assured as to what had been delivered in terms of physical improvements to the housing stock as a consequence of that expenditure.

·      The Committee noted that the Monitoring Officer would be submitting a report to the Committee at its special meeting on 29 November outlining the governance around the housing maintenance issue.

·     In response to a question as to whether the 3% loss of rental income compared to estimates due to voids was within the normal range, or whether it was something about which the Committee should be concerned, officers indicated that the quarterly Performance Monitoring Report considered by the Overview and Scrutiny Committee included a KPI on void properties.

Having considered the report and noted that this matter would also be considered by the Executive at its meeting on 23 November,  ...  view the full minutes text for item 40

The Committee received a report setting out the final position on the Housing Revenue Account (HRA) for the 2019-20 financial year.  The HRA recorded all the income and expenditure associated with the provision and management of Council owned residential dwellings in the Borough. 

This report sets out the actual level of revenue spending on day-to-day services provided to tenants recorded in the HRA in 2019-20.

Rental income from dwellings had been £165,000 (0.55%) below the estimate. The actual net cost of revenue services in 2019-20 had been £432,916 higher than the budget of £15,809,270.  This variation represented 2.73% of the total turnover of £32.37 million.  The final outturn (subject to audit) had shown a surplus for the year of £10.3 million, compared to a budgeted surplus of £10.93 million.  The HRA working balance at year-end remained at £2.5 million.

In accordance with the authority delegated to the Chief Finance Officer, in consultation with the Lead Councillors with responsibility for Housing and Finance, the surplus had been used to make a transfer of £2.5 million to the reserve for future capital programmes, with the balance of £7.8 million being transferred to the new build reserve.

This continued the policy adopted in previous years, whereby the year-end surplus was applied to each of the above two reserves.

During the debate, the Committee noted that there were approximately 5,200 properties held in the HRA, and although 19 had been sold under the Right to Buy during the year, the Council was adding to the stock with its new build programme.

Having noted that this matter would be considered by the Executive at its meeting on 22 September 2020, the Committee

RESOLVED: That the report be commended to the Executive.

Reason:

To allow the Statutory Statement of Accounts to be finalised and subject to external audit, prior to approval by the Corporate Governance and Standards Committee, on behalf of the Council.