Agenda item

To consider the proposed Rent Setting and Service Charge Policy for 2023/24 and beyond.

The Panel considered the proposed rent setting and service charge policy.

The proposed policy largely reflected National Government Policy. Changes had been proposed in relation to the reletting of social rent dwellings, to apply formula rent and rent flexibility, where applicable.  It was noted that this would be CPI plus 1% (the formula rent) and would only be applied when reletting social properties.  Rent flexibility could be applied in particular circumstances where the energy efficiency of a property had been improved or received significant expenditure.

It was also proposed that there be an increase in domestic energy charges from 2023/24.  The Council was currently under recovering the costs incurred in providing tenants with energy and / or communal heating and lighting.  It was proposed that an uplift of up to 25% from April 2023, and an uplift of up to 7% for communal services be introduced.  This would help to reduce the gap between charges incurred by the HRA account and that charged to tenants.  A wider review would be undertaken later in 2023/24 in order to ensure there was a fair and transparent charging mechanism in place for all properties liable for a service change.  Tenants would therefore be able to see the charges specific to their property and be able to hold the Council, as landlord to account.  Some tenants would see service charges increase / decrease, and some would have them introduced for the first time. 

It was noted that each year 250-300 properties were relet and any tenant moving into these properties would be charged the formula rent.  With regard to flexible rent, it was noted that the 5% uplift could only be charged in specific circumstances and that this would be reviewed.  The tenant would benefit from the improvements which had been made to the property in terms of energy efficiency and therefore savings would be made on the cost of utilities.  It was necessary to generate more HRA income, particularly where investment had been made in properties which would benefit tenants.  It was highlighted to the Panel that the Council had a Tenancy Support Worker who worked with tenants and would provide support to those in need.

Members noted that the Tenant Involvement Group had been largely supportive of the proposed recommendations.  The importance of recovering costs in a managed way was acknowledged. 

The Panel recognised that the HRA was under strain and that income needed to be generated, which could enable the Council to maintain and further invest in properties.

RESOLVED:

That the following recommendations to Cabinet be noted:

1.     The proposed rent setting and service charge policy (Appendix 1) in the context of government rent setting policy, HRA housing revenue account budget and housing public sector capital expenditure programme 2023/24;

2.     The proposed changes to current rent setting processes to apply formula rent to the reletting of social rent dwellings and rent flexibility where applicable; and

3.     The further proposed increase to domestic energy charges of up to 25%, and up to a 7% uplift of the charges for communal services received, to match the proposed increase in the basic rent for 23/24 from 3^rd April 2023.