Agenda item

15.1

The Executive Directors, Communities, Place and Resources submitted a joint report providing the 2014/15 update to the Housing Revenue Account (HRA) Business Plan. The report also presented a 2014/15 revenue budget for the HRA.

15.2

RESOLVED: That this Cabinet recommends to the meeting of the City

Council on 5th February, 2014 that :-

(a)

the HRA Business Plan update report for 2014/15 be approved;

(b)

the HRA Revenue Budget for 2014/15 as set out in Appendix B to the report be approved;

(c)

the rent increase for Council dwellings by an average of 6.2% from April 2014 be approved;

(d)

the rents for Council dwellings being set at target rent, when re-let following vacancy, from April 2014 be approved;

(e)

the increase of annual rents for garages and garage sites by an average of 6.2% from April 2014 be approved;

(f)

the increase of community heating charges by 3% in 2014/15 be approved;

(g)

it notes that it may be necessary to amend the sheltered housing service charge, in the event of a review of the service, if the Supported Housing Subsidy changes as part of the Council’s wider budget setting process;

(h)

it resolves that charges for furnished accommodation and temporary accommodation are not increased;

(i)

it delegates authority to the Director of Commissioning, Communities to amend the burglar alarm charge in 2014/15 in line with the costs incurred under the new contract. Until the contract is in place and the charges are known the burglar alarm charge will remain unchanged; and

(j)

it delegates authority to the Director of Commissioning, Communities and the Director of Finance, in consultation with the Cabinet Member for Homes and Neighbourhoods to authorise prudential borrowing as allowed under current Government guidelines.

15.3

Reasons for Decision

15.3.1

To maximise the financial resources to deliver key outcomes on key services in the context of a self-financing funding regime.

15.3.2

To contribute to making neighbourhoods a great place to live by ensuring continued investment into Sheffield’s Council housing.

15.3.3

To continue to plan for the long term sustainability of services whilst taking every opportunity to introduce service improvements.

15.4

Alternatives Considered and Rejected

15.4.1

To increase rents for Council dwellings by less than the Government formula – The Government’s self-financing debt settlement of 2012 assumed an amount of rental income over 30 years which was in line with the National Social Rent policy and was deemed sufficient to support the debt allocated to Council housing in Sheffield and the delivery of Council housing in the long term. Although the social rent policy is changing, the level of debt to be supported has not and so a reduction in income has a direct impact on the capacity of the plan.

15.4.2

Not to prioritise a Council housing stock increase programme – the reinvigoration of the Government’s Right to Buy policy means that if the Council is to retain any ‘additional’ receipts generated by the increased sales discounts now available to tenants, the receipt must be used as a contribution (30% maximum) to new affordable housing. Forecasts in 2013 suggest the level of such receipts will be significant in the coming years. The alternative to retaining these receipts would be to pass the receipts to a registered provider such as a housing association. Retaining the receipt in the HRA allows the Council to invest in new Council housing units to offset Right to Buy losses in a way which is beneficial to the plan, tenants and potential Council tenants over the long term.

(NOTE:1.This item is referred for approval by the City Council and cannot, therefore, be called in for scrutiny; and

2. The report on the Housing Revenue Account will be circulated to all Council Members).