Issue - meetings

Decision:

Noted the final outturn position and endorsed the decision, taken under delegated authority to transfer £2.5 million to the reserve for future capital, and £7.84 million to the new build reserve from the revenue surplus of £10.339 million in 2021-22.

Reason(s):

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) recorded the income and expenditure associated with the provision and management of Council owned residential dwellings in the Borough. The requirement to maintain an 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 Leader of the Council introduced the report that set out the actual level of revenue spending on day-to-day services provided to tenants recorded in the HRA in 2021-22.

The comments arising from the Corporate Governance and Standards Committee meeting on 29 September 2022 along with some financial updates were set out in the Supplementary Information Sheet.

The report set out the income and expenditure on the HRA for the year 2021-22 and it was confirmed that a sustainable budget had been maintained with an £11.2 million operating surplus. The 30-year business plan supported expenditure of £2.5 million of the surplus to maintain and improve the Council’s housing stock. The focus of the expenditure was to support the continued wellbeing of tenants and to increase the energy-efficiency of homes. In addition, a further £7.84 million would be added to the new-build budget. Right to Buy (RTB) receipts had been utilised and an additional 21 homes had been purchased for social housing resulting in no repayment penalties. Overall, the report was in line with the 30-year business plan.

The Lead Council for Resources added that the rental income was £29.2 million, there had been a low instance of arrears and few void properties for the period resulting in a strong financial position justifying the investments in the housing stock. Consequently, the Executive,

RESOLVED:

That the final outturn position on the HRA for 2021-22 be noted, and that the decision taken under delegated authority to transfer £2.5 million to the reserve for future capital, and £7.84 million to the new build reserve from the revenue surplus of £10.339 million in 2021-22, be endorsed.

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 2021-22. 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 recorded in the HRA in 2021-22. The operating surplus for the HRA in 2021-22 had been £368,000 less than the budgeted surplus of £11.220 million at £10.339 million. The outturn therefore allowed a contribution of £2.5 million to the reserve for future capital and a contribution of £7.84 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 Community and Housing and Lead Councillor for Resources had used their 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.

During the debate, the Committee made the following comments:

·       A need to review the way in which we transfer money to different pots of reserves in relation to the HRA 

·       emphasis on the importance of making sure we are taking account of climate change impacts particularly in relation to insulation

·       the importance of lobbying government in relation to Right to Buy replacement in the 60/40 split when it comes to the spending of right to buy receipts and

·       concern over implications of an increase in right-to-buy numbers and where it might be heading in the future

Having considered the report, the Committee

RESOLVED: That the report be commended to the Executive subject to the various corrections set out on the Supplementary information sheet circulated at the meeting and to the comments referred to above made by the Committee during its debate.

Reason:

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

Decision:

That the final outturn position on the Housing Revenue Account be noted and that the decision taken under delegated authority to transfer £2.5 million to the reserve for future capital, and £8.15 million to the new build reserve from the revenue surplus of £10.65 million in 2020-21, be endorsed.

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) recorded all the income and expenditure associated with the provision and management of Council owned residential dwellings in the Borough as required by the Local Government and Housing Act 1989, and the requirement to publish final accounts was set out in the Accounts and Audit Regulations 2003.  The Executive considered a report setting out the actual level of revenue spending on day-to-day services provided to tenants recorded in the HRA in 2020-21 with a recommendation to transfer a contribution to the reserve. The Lead Councillor for Community introduced the report.

The HRA recorded a healthy operating surplus for 2020-21 of £345,000 less than the budgeted surplus of £10.999 million. The surplus was slightly lower than expected due to the level of maintenance and repairs requirements, notably in void properties, which was being addressed. Rental collection rates had remained high and arrears low for the period despite the challenges of the Covid pandemic. It was noted that support for tenants was in place should there be financial difficulties for individuals facing arrears.

The outturn allowed a contribution of £2.5million to the reserve for future capital and a contribution of £8.15 million to the New Build reserve.  The HRA working balance at year-end remained at £2.5 million which was described as a healthy balance to invest in new builds and existing stock. Developing the new build sites was a corporate priority for the Council and the lead councillor confirmed that progress on Council-led projects would be brought to the Executive in the coming months.

The Executive noted that lead times on housing delivery were lengthy and the Council was committed to quality and high standards.

The report had also been considered by the Corporate Governance and Standards Committee at its meeting on 29 July 2021. Having noted the Committee’s comments, the Executive

RESOLVED: That the final outturn position on the Housing Revenue Account be noted and that the decision taken under delegated authority to transfer £2.5 million to the reserve for future capital, and £8.15 million to the new build reserve from the revenue surplus of £10.65 million in 2020-21, be endorsed.

Reason:

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

The Committee received a report setting out the final position on the Housing Revenue Account (HRA) for the 2020-21 financial year including the actual level of revenue spending on day-to-day services provided to tenants recorded in the HRA in 2020-21.  The HRA recorded all the income and expenditure associated with the provision and management of Council owned residential dwellings in the Borough. 

The actual net income of revenue services in 2020-21 had been £1.319 million lower than the budget of £15.810 million.  This variation represented 3.97% of the total turnover of £33.20 million.  The final outturn (subject to audit) had shown a surplus for the year of £9.95 million compared to a budgeted surplus of £11.6 million.  This included the HRA working balance at year-end, which remained at £2.5 million.

The Chief Finance Officer, in consultation with the Leader of the Council and Lead Councillor for Community and Lead Councillor for Resources had used her delegated authority to transfer £2.5 million to the reserve for future capital programmes, with the balance of £7.45 million transferred to the new build reserve.  This continued the policy adopted in previous years, whereby the year-end surplus was applied to each of those reserves.

During the debate, officers responded to the various comments as follows:

(a)   With the inclusion of the proposed transfer of £2.5 million, the balance in the reserve for future capital programmes was £38 million at the end of the financial year.  The Council had not yet spent anything from that reserve. The Leader of the Council reminded the Committee of the current review of the Housing Strategy which included a review of investment levels in the Council’s existing stock, particularly in terms of repairs and maintenance to extend the life of the existing stock.  Work in respect of bringing void properties back into use had been delayed due to the pandemic, but it was hoped that work could progress more speedily on this moving forward.

(b)   The Council had approximately 5,000 HRA properties, which yielded nearly £10m per annum, or £2,000 per property, which was not a huge amount of money to spend on refurbishment per unit.

Having noted that this matter would be considered by the Executive at its meeting on 24 August 2021, the Committee

RESOLVED: That, subject to the comments referred to above, 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.