Agenda item

To consider the HRA budget and the housing public sector capital expenditure programme for 2025/26.

The Panel considered the Housing Revenue Account Budget and the Housing Public Sector Capital Expenditure Programme for 2025/26.

The Strategic Director for Housing and Communities presented the report which proposed the HRA budget for 2025/26.  It was highlighted that over the last few years, Stock Condition Surveys had been completed and modelling carried out which gave a clear picture of the requirements needed to upgrade the housing stock in terms of energy efficiency as well as component parts, such as kitchens and bathrooms.  There was a robust plan over the next 30 years of the work required and the budget had been prepared to reflect this.   It was proposed there be an increased level of capital spending of £18.939 million to reflect on improvement works, which would also include fire safety and statutory compliance as well as decarbonisation works and energy efficiency measures, which would reduce tenants fuel bills.  The total proposed capital expenditure budget was £30.8 million and this included £15.2 million for the affordable development programme, which was a Corporate Plan objective.

In order to achieve the level of spending, there would be increased borrowing.  A 30 year business plan had been finalised which forecast the ability to borrow against the expected HRA income.  The business plan recognised that it was possible to take on additional borrowing as well as pay back the loan with interest.

The maximum rent increase was proposed, at 2.7%, which was based on the inflation rate in September 2024.  It was highlighted that since then, inflation had increased and the costs to provide improvement works would increase as a result.  There would be a need to refinance, some of the existing debt in order to bring a balanced budget.  The 30 year business plan would be reviewed and amended to reflect this.

Finally, the Tenant Involvement Group met and been consulted with since the report had been published.  The group expressed support to the recommendations and recognised there was a balance between rent increases and the need to improve and maintain the housing stock.

RECOMMENDED:

The Panel recommended approval to Cabinet of the HRA budget and housing public sector capital expenditure programme for 2025/26 as follows:

1. that from 07 April 2025, an increase in dwelling rents of 2.7% from the 2024/25 weekly rent level, in accordance with Government guidelines, be agreed;

2. that from 07 April 2025, an increase in garage rents of 2.7% from the 2024/25 weekly rent level be agreed;

3. that from 07 April 2025, an increase in shared ownership property rents of 3.2% from the 2024/25 weekly rent level, in accordance with Government guidelines of RPI +0.5%, be agreed, and that the weekly rent of one additional property sold under previous legislation be increased by 2.7%;

4. that from 07 April 2025 Service Charges will continue to reflect actual charges and following a reduction in window cleaning and utility costs, these respective charges will be reduced;

5. that the HRA budget, as set out in Appendix 1 of this report, be agreed; and

6. that a Housing Capital Programme to 2027/28, as set out in Appendix 4, be agreed.