5:35 to 5:45pm
Councillor Perkins, as scrutiny committee appointee to the Housing Revenue Account Business Plan steering group, to provide a verbal update from the meetings of the group.
Minutes:
Councillor Perkins, along with the Cabinet Member for Housing and Housing Manager, provided an update from the meetings of the Housing Revenue Account Business Plan (HRA BP) steering group.
Councillor Perkins reported that the HRA BP steering group had met twice since being established. The meetings focussed on the HRA finances, how they were managed and the implications of new legislation. Changes to the Welfare Reform Act and the introduction of the Housing and Planning Act 2016 were expected to have a big impact on HRA finances in the future. The purpose of the steering group was to find ways to fill revenue gaps in the HRA and put forward a revised business plan.
The steering group comprised of Officers and Members with Councillor T Murphy, the Cabinet Member for Housing, Chairing the meetings. The steering group also worked in conjunction with the tenants sub-group. Councillor Perkins, as the Scrutiny representative on the steering group, explained that involving Scrutiny right from the start in this way provided good opportunities for pre-decision Scrutiny.
There had been discussions in the steering group about recommendations for policy changes which included:
· Pay to stay – from April 2016 the market rent would be charged to households with an income exceeding £31k.
· Flexible tenancies – from April 2016 any transfer tenant would have a fixed term tenancy rather than a tenancy for life.
· Disposal of high value assets – the Council would be required to pay money back to the Government on vacant properties.
The recommendations had been difficult decisions to make and there was an uncertainty over what they would mean for Chesterfield. There would be a 1% reduction per year in rent for the next 4 years which equated to a loss of income amounting to £10m. Additionally there were certain types of property, largely flats, that were difficult to let resulting in a loss of rental income. The steering group had discussed the possibility of working with other local authority areas to exchange tenants where there was a need for a certain property type.
On 5 October, 2016 there would be the first in a series of workshops looking at each service area within HRA spending. The first workshop would look at repairs and maintenance which absorbed 60% of HRA costs.
The Cabinet Member for Housing added that there would also be a meeting involving senior officers that would explain the current situation of the HRA to tenants.
The Housing Manager advised that a review into repairs and maintenance had been commissioned as that was the biggest area of spend and CBC were currently spending above average on repairs costs. The workshops would be looking at the tenants’ obligations, investment standards and life cycles. In addition, on 30 October, 2016 there would be a workshop with the tenants steering group. Following the outcome of the workshops, the HRA BP steering group would make recommendations back to Cabinet.
Members had concerns that there was a limited stock of smaller houses and helping tenants to move into a private tenancy could bring higher rents and uncertain rent increases for tenants. Members acknowledged that the Council was facing severe challenges and that the new policies from the Government had an adverse impact on the Council’s HRA. Members thanked Councillor Perkins for the excellent report, and thanked the Cabinet Member for Housing and the Housing Manager for attending to provide support.
RESOLVED –
1) That the approach taken by the Housing Revenue Account Business Plan steering group to include scrutiny and other representatives be supported.
2) That it be noted the difficulties being caused are as a result of government policy.
3) That a report be brought back to the Enterprise and Wellbeing Scrutiny Committee after the next meeting of the Housing Revenue Account Business Plan steering group.