Agenda item

Annual Housing Revenue Account - Rent And Service Charge Increase

Decision:

*RESOLVED -

1. That for 2016/17 the level of individual social rents are based on the current National Social Rent Policy, giving a real rent decrease of 1.0% with effect from 4 April 2016.

2. That for 2016/17 and onwards, where a social rent property is re-let to a new or transferring tenant, the rent level is increased to the target rent for that property.

3. That for 2016/17 the level of individual affordable rents are based on the current National Social Rent Policy, giving a real rent decrease of 1.0% with effect from 4 April 2016.

4. That for 2016/17 and onwards, where an affordable rent property is re-let to a new or transferring tenant, that the rent level is set at 80% of the market rent for a similar property at the time of re-letting.

5. That from 1 April, 2016;

I. there is no increase in the heating service charge for sheltered housing schemes.

II. that garage rents are increased from £5.72 to £6.22 per week.

III. that the annual rental charges for garage sites are increased as below:

· Shale sites from £39 to £42.50

· Asphalt sites from £49 to £53.50

· Other sites from £54 to £58.50

IV. that the charges for metered water supplies are increased by 2%.

V. that the weekly charges for the Garden Assistance Scheme are increased as below:

· Grass cutting and hedges from £3.95 to £4.45

· Grass only from £2.80 to £3.15

· Hedges only from £1.15 to £1.30

VI. that the sheltered scheme support charge is set at £8 per week.

VII. that the weekly charges for the Careline service (inclusive of equipment rental) are:

· Monitor only, £4.50

· Monitor and Response, £5.50

· Monitor, Response and weekly visit, £8

VIII. that there is no increase in the community hire charges for Community Rooms.

IX. that the weekly charge for communal staircase cleaning is increased from £1.66 to £1.74

X. that the Tenant Home Contents Premium Tax increases from 6% to 9.5%.

REASONS FOR DECISIONS

To enable the Council to set the level of Council house rents in accordance with Government guidelines and to set service charges for 2016/17.

To contribute to the Council’s Corporate Priority ‘To improve the quality of life for local people’.

Minutes:

In accordance with the Local Government and Housing Act 1989, the Housing Service Manager – Business Planning and Strategy and the Chief Finance Officer submitted a report setting out proposed changes in Council house rent and service charge levels for 2016/17.

In 2012 the Council had entered into a Housing Revenue Account (HRA) self-financing agreement, and as a consequence was required to produce a HRA Business Plan that was financially viable, delivered reasonable standards for tenants and maintained properties to at least the minimum Decent Homes Standard. It was noted that due to the self-financing arrangement, investment in the Housing Service and housing stock was therefore largely funded through income from the properties, and the amount required directly influenced decisions on rent levels, additional borrowing and the use of cash reserves. The HRA self-financing agreement had also meant that the Council had no longer been obligated to follow the National Social Rent Policy on the setting of rent levels; however the Council had assumed that rents would rise in line with National Social Rent Policy. The Housing Service Manager noted that if rents did not increase at this rate, then the Council’s ability to finance future capital investments to maintain or improve the council’s housing to required or desired standards, as well as the council’s ability to service and repay debt could put at risk.

In the Government’s Summer Budget, the Chancellor of the Exchequer had announced that as part of the Welfare Reform and Work Bill, social housing rents would be reduced by 1% per annum in each of the following four years. The Government had stated that this legislative requirement to reduce social housing rents was intended to ensure that Local Authorities and Housing Associations delivered efficiency savings in order to make better use of the £13 billion annual subsidy (Housing Benefit) they received and to play their part in reducing the welfare bill. The Housing Service Manager provided details how the Housing Service proposed to respond to these changes and introduce the 1% rent decrease in 2016/17 as well as in subsequent years.

The Housing Services Manager’s report also outlined proposed increases to the Housing Revenue Account Service Charges for tenants. Increases to service charges were only proposed where current charges did not cover the cost of providing the service, or in the case of garages and garage sites, to finance capital improvements. It was also proposed that there should be no increase to the community hire charges for community rooms as usage remained low, and there was concern that increasing charges could reduce demand for the hire of the rooms further.