Issue - meetings

The Council to receive a joint presentation by the Director of Tenancy Services and the Corporate Head, Finance & Customer Services.                                                        (Enclosure)

DECISION:-

(1)          To note the position of the housing revenue account and the financial issues it faces.

Council had before them report TSE33 of the Director of Tenancy Services on the key financial issues facing the Housing Revenue Account (HRA). Council also received a presentation on this matter; the purpose of the report and presentation were to raise Members awareness of these issues.

There were a number of financial issues facing the HRA in the short and medium term. These were:-

• Raising customer expectations
• Increasing negative subsidy payments to be paid to the Government
• Reducing expenditure levels
• Limitations on rent increases
• The potential implications of the results of the stock condition survey

These issues taken together resulted in the HRA being unsustainable in the medium term.

The S.151 Officer also explained the principle of rent convergence, by which the Government wished to bring local authority rents in line with registered social landlords rent levels.

Members expressed concerns over the negative subsidy which the Council had to pay to Central Government, whereas housing associations and private landlords were exempted from this arrangement. A national review on this was due in Spring 2009, but any changes would not be effective until 2011.

The issues contained in the report and presentation would be considered in greater depth by the Resources Policy Development Group.

After further discussion, the motion was duly proposed, seconded and carried.