Cabinet Member for Finance and Resources
In accordance with Council Procedure Rule 19.3, immediately after any vote is taken at a budget decision meeting of the Council, the names of Councillors who cast a vote for the decision or against the decision or who abstained from voting shall be recorded in the Minutes of that meeting.
At its meeting on 7th February 2024, Cabinet considered Paper MCa/23/43, the Housing Revenue Account Budget for 2024/25. Paper MC/23/41 now includes all relevant updated information and the necessary recommendations.
Minutes:
105.1 The Chair invited Councillor Eburne, Cabinet Member for Finance and Resources to introduce the report.
105.2 Councillor Eburne introduced the report and proposed the recommendations. Councillor Winch seconded this motion.
105.3 Councillor Matthissen asked for more detail on the issue of compliance. Councillor Winch responded that as gas and electricity checks were behind the Council self-referred to the regulator, and the Council had made progress on their notice. Councillor Eburne added that following the referral fire safety issues were also discovered and it was requested that issues with damp and mould be addressed under the referral.
105.4 Councillor Hicks referred to recommendation E in the report and questioned whether the utility charge to tenants would be lowered if charges fell. Councillor Eburne responded that if costs did fall charges would be reduced. The Finance Business Partner – HRA added that the utility charge costs were backdated costs from the previous year.
105.5 Councillor Mansel questioned whether the increased charges in recommendations D and E in the report made the Council cost neutral. The Finance Business Partner – HRA responded that work was ongoing for cost neutrality, and low costs were taken so tenants were not overcharged.
105.6 Councillor Scarff questioned whether sheltered housing schemes would be made more energy efficient to reduce the increase in cost to tenants. Councillor Eburne responded that sheltered housing had been identified as an area that needed work and was currently being reviewed.
105.7 Councillor Caston queried the time period used to calculate the increased charge as it was when energy charges were above average. Councillor Eburne responded that under the rules in which the accounts work in the HRA this time period was used, however looking forward to these rules could be changed under the upcoming 30-year business plan.
105.8 During the debate, Councillor Patchett outlined that the funding model agreed by the Council in 2012 was a model that relied on interest only loans that needed to be refinanced, and a solution to this model was needed.
105.9 Councillor Mansel highlighted that the Council did not have any other option on the HRA and whilst this was not an easy decision for the Council to make groups needed to work together to find a solution going forward.
105.10 Councillor Scarff highlighted the period of 5 years with 1% rent reductions enforced by central Government and uncertainty due to Government restrictions on when rents could be raised or reduced, and that the Council would have been in a different position if restrictions were not enforced.
105.11 Councillor Carter outlined that essential services needed to be sustained and maintained and the backlog on maintenance and repairs which could not get worse as it would create further costs.
105.12 Councillor Stringer highlighted that the Council did not know when the HRA was originally agreed that rent reductions would be enforced by Central Government, and a better way to run this was needed.
105.13 Councillor Hicks stated that he did not support the report and increase in utility charges for tenants, and that splitting this charge over a period of two years would be a better approach.
105.14 Councillor Caston outlined that whilst he supported the increase in rents, he did not support the increase in utility charges and the period that heating costs were calculated over was not a reflection of current costs and he believed tenants were being overcharged.
105.15 Councillor Lawrence supported the report and outlined that if the utility charges were covered over the current year, then the tenants would see the benefit the following year. Additionally, for many of the tenants paying rent the costs would be covered by housing benefits and was not a true reflection of costs to residents.
105.16 Councillor Matthissen outlined that the HRA was a dysfunctional system and when the debt was taken on there was doubt as to how the housing stock had been paid for and how the Right to Buy scheme reduced the housing stock available, and the Council was left paying the mortgages on these houses due to the reduced cost to residents.
105.17 Councillor Davis outlined that whilst there was an increase in rents, in comparison to private rents the cost was lower and would help residents who could not afford private rents.
105.18 Councillor Lay highlighted the need for cross party working to find a solution to the HRA, and thanked Cabinet and officers for their work on the HRA.
105.19 Councillor Whitehead outlined that many issues such as a backlog on repairs from Covid, increased labour and material costs, and the long term borrowing system put in place by central Government to finance Council Housing contributed to the position the Council was in. However, he did not support the increase in rents and utility costs for tenants.
105.20 Councillor Walters commended the suggestions for cross party working to develop a better system, and he supported the recommendations in the report, as it was important for the Council to hold onto Council Houses and provide value for money as landlords.
105.21 Councillor Eburne thanked Members for their contributions to the debate and thanked officers for their work on the report. Whilst many tenants of Council Homes received housing benefit, the local housing allowance had increased and would make increases in charges less noticeable. Additionally, for residents most in need the Council was working with other organisations to provide support for tenants. The Council’s duty was to the tenants, and it was necessary to ensure that funds were in place to maintain their homes. She encouraged Members to contribute to and engage with the upcoming 30 Year HRA Business Plan.
In accordance with Council Procedure Rule 19.3, the vote was recorded as follows:
For |
Against |
Abstentions |
David Bradbury |
James Caston |
John Whitehead |
Terence Carter |
Matthew Hicks |
|
Teresa Davis |
Anders Linder |
|
Rachel Eburne |
Gilly Morgan |
|
Lucy Elkin |
|
|
Nicholas Hardingham |
|
|
Terry Lawrence |
|
|
Colin Lay |
|
|
Sarah Mansel |
|
|
Adrienne Marriott |
|
|
John Matthissen |
|
|
Andrew Mellen |
|
|
Jen Overett |
|
|
James Patchett |
|
|
Janet Pearson |
|
|
David Penny |
|
|
Daniel Pratt |
|
|
Miles Row |
|
|
Keith Scarff |
|
|
Andrew Stringer |
|
|
Ollie Walters |
|
|
Rowland Warboys |
|
|
Tim Weller |
|
|
Nicky Willshere |
|
|
Richard Winch |
|
|
By a vote of 25 votes for, 4 against and 1 abstention.
It was RESOLVED: -
1.1 That the Council approves:
a) The HRA Budget proposals for 2024/25 set out in the report.
b) An increase of 7.7% for council house rents, equivalent to an average rent increase of £7.33 for social rent and a RPI + 0.5% (9.4%) increase for affordable rent of £10.65, a week be implemented.
c) That the RPI increase of 8.9% in garage rents, equivalent to an average rent increase of £3.84 a month, be implemented.
d) That an increase of 18% for sheltered housing service charges, equivalent to £27.19 a month, be implemented.
e) That an increase of 44% for sheltered housing utility charges, equivalent to £29.63 a month, be implemented.
Supporting documents: