The Committee were presented with:

• The 2022/23 provisional Housing Revenue Account Outturn, including movements in the Housing Revenue Account working balances and General Reserve

• The 2022/23 provisional Housing Revenue Account Capital Outturn

The Principal Accountant (Housing & Exchequer) directed Members to page 34 of the report which held an Executive Summary of the information in the report pertaining to the:  

• HRA (Revenue)
• Housing Capital

Members noted that at the end of the financial year, income and expenditure for the year was balanced with a contribution of £1.025m to reserves to fund future revenue and/or capital expenditure. The figure a significant movement from the forecasted outturn reported in previous monitoring reports and whilst it was a positive year end position, it was

important to understand that whilst Housing Officers worked hard to prioritise spend, where possible, it was largely driven by finance year end accounting transactions.

Members were taken further through the report and updated on other key areas of financial performance that may impact on the Councils HRA Business Plan.

The Principal Accountant (Housing & Exchequer) fielded questions from Members and

explained that:

• In the last financial year (2022-23) thirty-nine houses were sold under right to buy which was the highest amount sold in one financial year and reflected the year on year increase. To date in this financial year (2023-24), only two houses had been sold, most likely due to current economy and cost of living pressures
• The money received from Right to Buy receipts was paid as an annual pooling return to the Government; in previous years a proportion of the money was repaid to Government with the remainder being kept by the Council as one-for-one receipts to reinvest into the affordable housing programme. The Council also retained a small proportion to cover admin costs. For 2022-23 and 2023-24,; the Council was able to retain 100% of the funds and reinvest it into local new build housing schemes in order to provide more homes for local residents
• The percentage cost of a new home that local authorities could fund using Right to Buy receipts had increased from 30% to 40% with the remaining 60% being funded by the Council
• 4.9 – A favourable variance of £9.8 million had been reported for the New Build Scheme but it wasn’t a true saving as schemes will be delivered in future years;

The Principal Accountant (Housing & Exchequer) agreed to circulate an email with further information regarding the £52k favourable variance from rear accessways.

In response to a Members question, concerning the future of the HRA the Principal Accountant (Housing & Exchequer) explained that the HRA still faced significant challenges in the future. The Principal Accountant (Housing & Exchequer) attended a Housing Finance webinar earlier today and it was reported new Housing Standards were going to be implemented which included areas around the building safety act and net zero carbon targets, minimum level EPC ratings etc but the costs to the Council for implementing those new standards was currently unknown. With regards to challenges the HRA faced this financial year, Members were advised that key challenges were repair and maintenance costs and the difficulty in recruiting staff to Housing. The Council were currently in a position where a small amount of resources were able to fund the HRA overspend but difficult decisions would need to be made in the near future.

The Assistant Director (Corporate Services) agreed that in the short term the HRA’s finances were stable but in the long term the impact of future changes to the Council’s finances was unknown; the HRA was assisted by the revised Depreciation Policy last year which resulted in £1.7 million favourable variance but that was a one off and would not be repeated in future years.

The Assistant Director (Corporate Services) further added that it was unknown if interest rates, and the costs of materials would decrease in the future, but the team were manging the HRA finances as best as they could with the information available to them.

In response to a Members question concerning temporary accommodation, the Principal Accountant (General Fund) advised that the budget for temporary accommodation was £1.5 million. £300K of that budget was funded through the Homelessness Prevention Grant, a portion of it was funded through housing benefit income and the bulk of it was funded through the Councils own reserves.

The Committee noted the report.