Agenda item

Financial Plan for Council Homes 2017-18

This report covers the proposed Housing Revenue Account budget and the Financial Plan for Council Homes which are going to Cabinet for approval in February.


Councillor Lisa Homan (Cabinet Member for Housing) and Kathleen Corbett (Director of Finance and Resources in Housing) introduced the report that covered the proposed Housing Revenue Account (HRA) budget and the Financial Plan for Council Homes. She noted that in July 2017, the Council announced the introduction of the Fire Safety Plus Programme to make sure the Council’s homes and other properties met higher standards. This cost in the region of £20m. In addition, the HRA would be making a revenue contribution of £14m to fund capital investment costs, mainly funded from the HRA general reserves.


Councillor Harry Phibbs asked if there were any potential for saving money by sharing services between estate management companies. Councillor Lisa Homan responded that some estates had discussed sharing caretaking services and while nothing had been formalised the Council didn’t rule it out as an option. Councillor Phibbs said it was disappointing that there hadn’t been any real progress. Kathleen Corbett said recently there had been a lot of mergers and change in the sector – she felt it was best to wait until the market was more settled.


A resident noted they were part of an estate services monitoring group that was looking at the services provided and any overlaps – so there were groups looking into this issue. Councillor Homan reiterated that there had been initial discussions and she felt it was important to do this with residents to ensure the quality of provision remained high.


Councillor Adam Connell noted that the Government’s rent cap was ending and asked if officers had modelled the impact of this change in the budget. Kathleen Corbett said that had already been factored into the 40-year business plan.


Councillor Harry Phibbs asked what the Council’s policy on shops was regarding reducing HRA debt. Should we sell them? Kathleen Corbett replied - six or seven years ago the Council sold some of the HRA’s ‘prime’ shop portfolio so the stock that was left were secondary investments of lower values. At this time, the Council was not actively selling shops. Councillor Lisa Homan added that the Council’s shop portfolio generates over £1m per year and if they were sold we would have to find that revenue elsewhere.


Councillor Harry Phibbs highlighted scaffolding as a major cost that residents were frustrated about (the length of time it was up etc.). He noted that the Committee had made a number of recommendations on improving this and asked for a progress update on implementing them. Councillor Lisa Homan said there had not been enough big planned maintainable schemes since the recommendations were made for savings to be calculated but the ideas were being put into practice. There would be a review in future.


Councillor Harry Phibbs noted that the Council had set-up a Council-owned company to renegotiate contracts to save money, including HRA contracts. He asked for an update on those savings. Kathleen Corbett said any contract renegotiation would take a while to come through in the figures. Savings in the current period were offset by additional investments in Fire Safety Plus and other programmes but in future years there would be savings.


Councillor Phibbs asked if the Council was ruling out reductions in service with contract renegotiations. Councillor Homan said the Council wanted residents to work with officers to ensure quality – this had already started with resident monitoring groups looking at a wide range of contracts, the caretaking contract with Pinnacle PSG for example. These groups had found a number of areas of overlap and would be reporting their findings in March 2018.



That the Committee reviewed and commented on the report.

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