Agenda item

The Director of Community Services presented a report outlining the proposed Housing Revenue Account (HRA) budget for 2019-20 which covered all expenditure and income relating to the Council’s housing stock.  The budget estimates were predicated on the assumptions, ambitions and priorities contained in the HRA Business Plan 2019-2049 which was appended to the report.

The report set out progress with the new build programme, together with the proposed investment programme in tenants’ homes.  The Business Plan attached a lower priority to the repayment of debt principal inherited as part of the self-financing HRA settlement.

Since the previous HRA budget report, there had been three key Government announcements that improved the Council’s ability to deliver its ambitions to increase and improve social housing in the Borough, namely, the removal of the HRA borrowing restriction, reverting to an index-linked rent setting policy from 1 April 2020 and not implementing the enforced sale of higher value council houses.

The prevailing social rent policy set out in the Welfare Reform and Work Act 2016 required social housing providers in England to reduce social rents by 1% per annum for the four years from 1 April 2016.  Rents for 2019-20 would therefore be reduced by 1%.  A 3.4% increase in rents for the Council’s 1,700 garages was proposed from April 2019, based on the Consumer Price Index (CPI) plus 1%.  A consultation would take place in respect of the level of rent to be charged for new developments which would be decided on a case by case basis.  Fees and charges were closely linked to utility charges and a charge for alarms would be introduced as Surrey County Council had withdrawn the related subsidy it had previously provided.

There was a capital investment programme of £5 million to maintain the stock in a good modern condition.  Air source heat pumps were being introduced as they were economical to operate.  Work to repair subsidence damage resulting from the hot summer weather in 2018 was in the region of £400,000 and £600,000 was being expended on disabled facilities.

The new build programme was ambitious and the Council was free to borrow to fund it following the lifting of the previous Government restriction.  £10 million was budgeted for new land and property acquisition and progressing schemes.  Including a residential element in the Guildford Park multi-storey car park redevelopment was proposed.

The following points arose from questions and discussion:

·                  The EAB was pleased to note the lifting of the borrowing cap, the cessation of the rent setting policy and the non-implementation of the enforced sale of higher value council houses priced over £200,000 which affected the majority of the Council’s stock.

·                  Housing officers and the Lead Councillor for Housing and Development Management were congratulated on their successful management of the Council’s housing stock.

·                  Lobbying of the Government to resist the Right to Buy initiative should continue as approximately 25 homes were sold each year at a discount and needed to be replaced.

·                  New build properties should be let at social rent levels and not at the higher ‘affordable rents’.

·                  The operating surplus figure for 2019-20 in paragraph 7.4 of the report should be £10.469 million.

·                  To date approximately 50 people had been transferred to the Universal Credit scheme.

·                  The Council was acquiring analytical software to monitor payment patterns and focus on tenants experiencing difficulties paying their rent.  A rent payment telephone application was available.

·                  The General Fund included provision to house homeless people.

·                  The Local Plan would inform where the Council and social landlords could provide housing.

·                  Residents were reassured that the energy efficient composite cladding panels used on Council homes was safe and used on low rise buildings only.

·                  It was thought that there was a mixed use of Council garages for storage and housing cars.  Opportunities to redevelop under used garages to provide homes were identified.

·                  Where the cleaning of communal areas by tenants was unsatisfactory, the Council would arrange cleaning and recoup the costs from tenants through a service charge.

The recommendations to the Executive and Council, which were consistent with the objectives outlined in the HRA Business Plan, were endorsed.