Agenda item

Housing Revenue Account Estimates 2019-20 and Housing Capital Programme


The Cabinet was presented with the draft revenue and capital estimates for Housing Revenue Account Services in 2019-20 together with the determination of the level of rents and service charges for 2019-20.


The report was presented in four sections and the Assistant Director (Corporate Services) provided Members with a detailed summary of each section:-


·         Section One – HRA Revenue Account Budget;

·         Section Two – Housing Capital Programme;

·         Section Three – Robustness of Estimates and Adequacy of Reserves; and

·         Section Four – HRA Business Planning.


Members were reminded that the Government made a commitment in the Summer 2015 Budget to reduce social rents by 1% a year for four years from April 2016 to April 2019 inclusive (i.e. for financial years 2016-17 to 2019-20) to help reduce the Housing Benefit bill and cut the deficit. Adhering to the new Government rents decrease formula, the authority’s average rent will decrease to £87.71 in 2019-20 compared to £87.77 in 2018-19 (the average rent reduction will not be exactly equal to 1% due to re-letting of void properties at target rent and additions of properties during the year). 


The Government also expects authorities to protect tenants against sharp rises in service charges. The Government have stated that the increase in the service charge of an individual property should not exceed CPI+1% with the CPI figure as at September 2018 being 2.4%. By adhering to this policy the authority’s average capped service charge is £3.33 per week for 2019-20.


Members were informed that business planning was central to a self-financed HRA for financial and service planning, monitoring progress and managing risk. The business plan shows how, over 30 years, the rental and other income will fund all the investment needs of the stock, servicing of the debt and day-to-day management and repair requirements. It is the main tool for the financial management of the HRA and has a substantial impact on the asset management plans. The investment in the stock will be funded from internally managed resources: capital receipts, revenue monies available, and other contributions received, supplemented by any additional prudential borrowing required. Whilst, capital receipt pooling to the government is to continue, the debt that authorities can take on is no longer capped following a government announcement in October 2018.


The Cabinet thanked the Assistant Director (Corporate Services) and her team on the work that had been undertaken to date.


Resolved that the Cabinet recommends to Council that:-


1.    the draft Revenue estimates for 2019-20 together with the revised estimates for 2018-19 to be approved;

2.    the draft capital estimates, together with the revised estimates for 2018-19 be approved, subject to detailed reports coming forward for new schemes, where applicable; and

3.    the decrease in average rents of 1% for 2019-20 be noted.


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