Agenda item

Members will receive this report which outlines the purpose and scope of the Housing Revenue Account (HRA) Business Plan, the main priorities of the current Business Plan and the proposed additional areas of priority for a 2019 revised Plan alongside a similarly revised Asset Management Strategy.

Members are requested to note and comment on the priorities outlined in this report and/or request any further information for  future meetings that arise from the issues presented in the report.

Members received a report which outlined the purpose and scope of the Housing Revenue Account (HRA) Business Plan, the main priorities of the current Business Plan and the proposed additional areas of priority for a 2019 revised Plan alongside a similarly revised Asset Management Strategy.

Denis Southall, Head of Housing (CYC), Patrick Looker, Finance Manager (CYC) and Adrian Waite, Director of Adrian Waite (Independent Consultancy Services) Limited (AWICS) were in attendance to answer questions from Members.

Adrian Waite circulated a briefing paper which provided his view on the position as regards the HRA.  Members were pleased to note that he considered that the HRA appeared to have very healthy finances.  Arising from this, he considered that the council had a range of options.  Due to his experience of working with a number of local authorities, Adrian Waite was able to advise Members and provide insight as to how other authorities organise their HRA and housing stock, business planning and strategic issues.

Adrian Waite provided the following information in response to questions from committee members:

·        He explained that he had worked for approximately 12 councils.  He also provided consultation on the LGA peer review programme.

·        There is no scientific way of judging an authorities spend.  His role is to encourage authorities and ask them questions about what they will spend money on.

·        The council is in a good financial position to spend on new stocks.

·        Regarding service charges, the council are spending 2million (m) on providing services and receive a return of only 1.3m, he suggested there may be an opportunity to charge more.

·        The provision for major repairs was increased by 29%, the government’s own research  had recommended increasing provision by 43%.

·        Right to Buy policy is reducing the stock of social housing in York.  Much of the proceeds of these sales go to the Treasury rather than being retained locally.  It could be argued that local authorities should have discretion over the operation of the ‘right to buy’ scheme.  There should be more discretion for capital receipts.

·        The council’s general reserves are at about a year most, authorities would be happy with 3 months, there is no right or wrong. 

Officers provided the following information in response to questions from committee members:

·        The Finance Manager explained that the law requires that the council shows its business plan over a 30 year period.

·        There was a short explanation around how the HRA balances and options available.  The council has the option of: (1)borrowing to buy capital assets, then you will have a HRA that balanced with high debt from council stock.  Or (2) the council could minimise debt and spend less on capital.  Or (3) somewhere in between.

·        On the £17m in other earmarked reserves, the Finance Manager clarified that £10m of this was money put into the new building reserves and £7m was to pay for James House, Lincoln Court in the capital programme.

·        An additional £1m had been agreed by the Executive towards achieving the Decent Homes Standard and a further £1m had been allocated for investment in carbon reduction programmes and energy efficiency.

·        Investment in energy efficiency as the council had the intention to make non-traditional properties more energy efficient.

·        In relation to consultation undertaken to establish people’s needs and inequality.  The Equalities Board were tackling homelessness which is a long term priority for the council in relation to its priority for improved mental health.

·        The Housing Manager explained that their department were working with Health colleagues to develop a mental health pathway and funding had been agreed, with consideration to sites to take this forward.  This would be in relation to supported or assisted living projects. 

Resolved: Members noted the report and appreciated the

opportunity to consider and comment on the outlined priorities.

Reason:     In order for Members to receive information regarding the HRA Business Plan.