Agenda item - Report of the Leader and Executive - Housing Revenue Account 2024-25

To consider the Housing Revenue Account 2024-25.

Note - A recorded vote on these recommendations will be required as per the legislation.

Councillor Federica Smith-Roberts proposed the recommendations which were seconded by Councillor Liz Leyshon.

Having been duly proposed and seconded, the Council RESOLVED to approve:

1) Revenue Budget for 2024/25 (see section 8)

· The HRA Annual Revenue Budget for 2024/25 as shown in Appendix A.

2) Rent Setting for 2024/25 (see section 10)

· An increase of 7.7% to Dwelling Rents in line with the Governments 2019 (and updated 2023) Rent Standard.

· An increase of 7.7% for Sheltered and Extra Care housing rents in line with the dwelling rents increase.

· An increase of 7.7% for Shared Ownership properties.

· An increase of 7.7% on affordable rental tenures, with the rent being reviewed at relet based on 80% of open market rent capped at the LHA rate.

· The continuation of rent flex at relet for new tenants within the West of the Council for tenants part of the in-house service (dwelling stock inherited from the legacy Somerset West and Taunton Council) as included in the Rent Charging Policy. This would be levied at basic rent plus 5% for general needs tenants and 10% for sheltered and extra care tenants.

· The introduction of rent flex at relet for new tenants within the North of the Council for tenants part of Homes In Sedgemoor (dwelling stock inherited from the legacy Sedgemoor District Council) as included in the Rent Charging Policy. This would be levied at basic rent plus 5% for general needs tenants and 10% for sheltered and extra care tenants.

3) Fees & Charges for 2024/25 (see section 11)

· An increase in Service Charges for tenants in the North, managed by Homes In Sedgemoor, based on predicted costs in line with the service charging policy. The introduction of a transparent 10% service charge management fee. The service charges were contained in Appendix B.

· An increase in Service Charges for tenants in the West, managed by the In-House Service, of (a) 7.7% for Grounds Maintenance and the Support / Sheltered Housing and Extra Care accommodation services, (b) 6.8% for the Piper Lifeline service, (c) other charges based on actual costs incurred for laundry, heating, communal areas, communal door entry systems, (d) no change to the communal utilities charge, (e) a new charge for exceptional street cleaning, (f) sewerage would increase in line with the Wessex Water increases for 2024/25 once known. The service charges were contained in Appendix C.

· An increase of 7.7% for garage rents.

· An increase of 6.7% on temporary accommodation daily rates.

· An increase of 6.7% for Meeting Hall hourly rental rates.

· An increase of 6.7% for Guest Room charges.

4) Capital Programme from 2024/25 (see section 12)

· The HRA Major Works and Improvement Capital Programme for 2024/25 of £8,834,500 for HiS and £19,189,200 for the In-House Service.

· To approve a capital budget of £940,000 for the delivery of the Bespoke Homes Phase 2 scheme (North of Somerset). This scheme would deliver 2 large and fully adapted new homes that would be built to low carbon standards in excess of building regulations and extend two existing council dwellings to create larger adapted homes. The proposal was to finance this using an appropriate combination of up to 29.78% subsidy from Homes England and the remainder funded by borrowing. These homes would be let at social rents.

· To approve a capital budget of £968,000 for the delivery of the Rochester Road Step Down / Move on Accommodation (West of Somerset). This scheme would deliver 8 new homes and let to vulnerable adults or children such as low complex homeless or children leaving care. The homes would use Modern Methods of construction and be of built to low carbon standards in excess of building regulations. The proposal was to finance this scheme using a combination of Better Care Funding and the remainder funded by borrowing. These new homes would be let at affordable rents and discounted if appropriate.

· To approve a capital budget of £2,000,000 for the delivery of the Step Down / Move On Accommodation scheme (West of Somerset). This scheme would deliver 16 new homes for vulnerable adults or children such as low complex homeless or children leaving care. The homes would be built to low carbon standards in excess of building regulations and use Modern Methods of construction. The proposal was to finance this scheme using a combination of Better Care Capital Funding and the remainder funded by borrowing. These new homes would be let at affordable rents and discounted if appropriate.

· To approve a capital budget of £2,615,430 for the delivery of the Taunton Road scheme (North of Somerset). This scheme would deliver 11 new homes that would be built to low carbon standards in excess of building regulations. The proposal was to finance this using an appropriate combination of up to 40% subsidy from RTB receipts and the remainder funded by borrowing. These new homes would be let at affordable rents.

· To approve a supplementary budget of £656,760 for the current Cricketers scheme (North of Somerset) to fund the projected overspend to complete the scheme. This scheme was delivering 16 new homes and would be built to low carbon standards in excess of building regulations. The proposal was to finance this using Homes England capital grant, Hinkley Point C funding and the remainder funded by borrowing. These new homes would be let at affordable rents.

· To approve a supplementary budget of £375,000 for the current Oxford Inn scheme (West of Somerset) to fund the projected overspend to complete the scheme. This scheme was delivering 8 new homes would be built to low carbon standards in excess of building regulations. The proposal was to finance this using an appropriate combination of up to 40% subsidy from RTB receipts and the remainder funded by borrowing. These new homes would be let at affordable rents.

· To approve a budget return of £20,274,207 for the North Taunton Woolaway Project Phase D (West of Somerset).

· To approve a budget return of £10,499,189 for the Zero Carbon Affordable Homes scheme(West of Somerset).

· To approve a budget return of £950,000 for the Tuckerton Lane scheme (North of Somerset).

· To approve a budget return of £500,000 for the Purchase of Properties for RTB scheme (North of Somerset).

5) Medium Term Financial Plan 2024/25 – 2029/30 (see section 9)

· To note the reviewed and updated assumptions in the 2024/25 5-Year Medium Term Financial Plan (MTFP).

· To approve the transfer of four dwellings from the General Fund to the Housing Revenue Account and delegate authority to the Lead Member for Communities, Housing and Culture and the Section 151 Officer to approve the final land transfer value.

· To approve an increase in the HRA’s strategic approach to generate capital receipts of approximately £1.225m through the sale of uneconomical assets on the open market.

6) 30-Year Business Plan (see section 8)

· The updated assumptions and figures in the 2024 HRA 30-Year Business Plan as summarised in section 7.

· That members note the challenges and next steps for the HRA and landlord services.

The Lead Member for Communities, Housing and Culture, Councillor Federica Smith-Roberts, introduced the report which was considered at the Executive meeting on 7 February 2024.

The report included the proposed Housing Revenue Account (HRA) Annual Revenue Budget and Capital Programme for 2024-25, along with the proposed Rent Setting, Fees and Charges for 2024-25.

The report also provided an update on the 5-year Medium Term Financial Plan and the 30-year Business Plan Review.

The Council discussed the report and the following points were raised:-

· Concern was raised on the impact the cost-of-living crisis was having on the council’s tenants. Councillors further queried what support was available for the tenants and whether the information was clear and communicated out to all the tenants.

The Lead Member for Communities, Housing and Culture advised that details of what support was available was included in the tenant newsletter and that they would also promote details using the Council’s social media accounts.

· Councillors hoped that the Council would become the lead on building ‘homes for life’ which would see an increase in specially adapted homes being built in the future.

· Councillors praised the Lead Member for the work that had been achieved on the North Taunton Woolaway Project.

· Concern was raised that the new houses being built in Seaward Way, Minehead would be allocated to people from outside of Somerset.

The Lead Member for Communities, Housing and Culture advised that applicants would need to have a local connection to apply for the new properties in Minehead.

· Concern was raised on the Homefinder Somerset system and that it did not work well for applicants.

The Lead Member for Communities, Housing and Culture advised that they were looking into an improved system as they were aware of the challenges faced by those who used the Homefinder system.

· Councillors queried what would happen to the HRA if a Section 114 notice was issued.

The Section 151 Officer advised that the HRA was a ring-fenced account but that it could be used by the commissioners as they could use all councils’ funds. However, it did not mean that the Council would look to dispose of the HRA, especially if it was self-funding.

· Councillors thanked officers for their hard work.

Councillor Federica Smith-Roberts proposed the recommendations which were seconded by Councillor Liz Leyshon.

Having been duly proposed and seconded, the Council RESOLVED to approve: