Agenda item

Draft Housing Revenue Account (HRA) Budget and Rent Setting Report 2024/25

Minutes:

The Committee considered the report of the Executive Director of Finance and Resources and the Executive Director of Environment and Place, which had been referred direct by the Cabinet from the meeting held on 11 January 2024.

 

The report set out how investment from the Housing Revenue Account (HRA) would contribute towards meeting housing needs in Southend-on-Sea and presented the outcome of Southend-on-Sea City Council’s annual rent review and associated rent setting proposals for all council dwellings within the HRA for 2024/25.

 

The Cabinet Member responded to a number of questions in relation to:

·       Benchmarking of garage rents, the increase of garage rents following a consultation with South Essex Homes.

·       The progress of passive house project; active project and discussions were ongoing with architects and work was expected to be starting soon.

·       Damp, Mould and Condensation problems in South Essex Homes properties and whether this had been factored into the budget. It was explained that a number of workstreams were in place which included a damp, mould and consultation working group, retrofit and passive house projects informing the longer-term programme and communication with tenants to identify and rectify issues more swiftly.

·       It was highlighted that the current repairs and maintenance contract was due to end in June 2024, but a procurement process was underway for a new contract and there would not be a gap in provision.

·       The projected net operating surplus of the HRA budget of £4.8 million as working capital.

 

Resolved:

 

That the following decisions of the Cabinet be noted:

 

“That Cabinet recommends to Council that, as part of the budget setting process, it approves the following increases with effect from 1 April 2024:

 

1.     An average rent increase of 7.7% on all tenancies.

 

2.     An average rent increase of 7.7% on shared ownership properties.

 

3.     An increase of 10% for garage rents to £15.38 per week for tenants and £18.46 for non-tenants (being £15.38 plus VAT), a rise consistent with the standard approach taken across the range of City Council’s fees and charges for 2024/25. All variants on a standard garage will receive a proportionate increase.

 

That Cabinet recommends to Council that, as part of the budget setting process, it approves:

 

4.     South Essex Homes core management fee be agreed at £7,678,000 for 2024/25.

 

5.     South Essex Homes proposals for average decreases of 3.1% in service charges to reflect the estimated costs incurred be agreed for 2024/25.

 

6.     South Essex Homes proposals for an average 7.4% decrease in heating charges for sheltered housing tenants and for hostel tenants to reflect the estimated costs incurred be agreed for 2024/25.

 

7.     The following appropriations be agreed:

·       £60,000 to the Repairs Contract Pensions Reserve.

·       £4,761,000 to the Capital Investment Reserve.

·       £8,015,000 from the Capital Investment Reserve.

 

8.     Subject to the approval of items 2.1 through to 2.7 above, the HRA budget for 2024/25 as set out in Appendix 1 be agreed and

 

9.     The value of the Council’s capital allowance from 2024/25 be declared as £57,098,000 as determined in accordance with regulation 16 of the Local Authorities (Capital Finance and Accounting) (England) Regulations.

 

That Cabinet notes:

 

10.  The developing draft 30-year Housing Revenue Account Business Plan (structure and text only) as set out in Appendix 4 and supports any minor amendments to be completed by the Executive Director (Environment and Place) in consultation with the Cabinet Member for Housing and Planning. The final version of the Business Plan will be submitted to Cabinet for approval in February 2024.”

 

Note: This is an Executive Function, save that approval of the final budget following the 13 February 2024 is a Council Function.

Cabinet Member: Councillor D Garston.

Supporting documents:

 

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