Issue - items at meetings - Housing Revenue Account (HRA) Budget Setting 2021 to 2022

The Housing Revenue Account (HRA) is a separate account within the Council that ring-fences the income and expenditure associated with BCP Council’s housing stock, including housing in both the Bournemouth and Poole neighbourhoods.

This report seeks approval for the proposed budget for the HRA for 2021/22 and the key principles on which it is based.

It sets out the proposals regarding the rents, service charges and other charges to tenants as well as the expenditure plans for the 2021/22 rent year. These proposals and the actions within the attached delivery plans for each neighbourhood all support the priorities set out in the Council’s Corporate Strategy.

RECOMMENDED that:-

(a) That revenue budgets for 2021/22 and provisionally for 2022/23 and 2023/24 are set using the following principles:

(i) That dwelling rents are increased by 1.5% (CPI for September 2020 + 1%) from 5 April 2021 in line with the Ministry of Housing, Communities and Local Government (MHCLG) Policy statement on rents for social housing published in February 2019.

(ii) That dwelling rents are moved to formula rent when a property is re-let following a vacancy.

(iii) That garage rental charges are increased by 2% from the 5 April 2021 across both neighbourhoods. That rental charges for garage bases and parking plots in the Bournemouth neighbourhood also increase by 2% from 5 April 2021.

(iv) That the garages owned by the HRA at Anchor Close, Bearwood are transferred to the General Fund.

(v) That leasehold services are charged to leaseholders in line with actual costs incurred.

(vi) That the changes to service charges are agreed as set out in appendix 2.

(vii) That the budgeted bad debt charge is maintained at £188,000 in the Bournemouth neighbourhood and £197,000 in the Poole neighbourhood.

(viii) That the depreciation budget is set at £6.878m for the Bournemouth neighbourhood and £4.665m for the Poole neighbourhood.

(ix) That HRA reserves should be maintained at a minimum level of 5% of total expenditure in line with good practice. This equates to £976,250 for the Bournemouth neighbourhood and £769,900 for the Poole neighbourhood for 2021/22, totalling £1.746m

(b) That capital budgets for 2021/22 and provisionally for 2022/23 and 2023/24 are set using the following principles:

(i) That the planned maintenance programme as set out in Appendix 5 is agreed.

(ii) That the major project capital programme as set out in Appendix 6 is agreed.

(iii) That funding totalling £6.824 million is carried forward from the 2020/21 Bournemouth neighbourhood capital programme and that funding totalling £4.955 million is carried forward from the 2020/21 Poole neighbourhood capital programme to reflect where expenditure on major projects has commenced but these projects have not yet been completed.

(c) That the Delivery Plans for each neighbourhood to support the key principles for the HRA and the Council’s Corporate Strategy are agreed as set out in appendices 7 and 8.

Voting: Unanimous

Portfolio Holder: Homes

The Portfolio Holder for Homes presented a report, a copy of which had been circulated to each Member and a copy of which appears as Appendix 'H' to these Minutes in the Minute Book.

Cabinet was advised that HRA rents and other changes along with the HRA Capital Programme are subject to review and require Cabinet and Council approval in order for rents and charges to be levied.

In relation to this Cabinet was informed that the Housing Revenue Account (HRA) is a separate account within the Council that ring-fences the income and expenditure associated with BCP Council’s housing stock, including housing in both the Bournemouth and Poole neighbourhoods, and that this report sought approval for the proposed budget for the HRA for 2021/22 and the key principles on which it is based.

In addition to this Cabinet was advised that the report also sets out the proposals regarding the rents, service charges and other charges to tenants as well as the expenditure plans for the 2021/22 rent year, and that these proposals and the actions within the attached delivery plans for each neighbourhood all support the priorities set out in the Council’s Corporate Strategy.