Issue - meetings

Purpose of report

To present the Council’s forecast 2025/26 financial position as at end of September 2025.

Decision

That Cabinet:

1. Noted the forecasted 2025/26 outturn position for the Housing Revenue Account (HRA) Revenue and Capital budgets as at the end of September 2025.

2. Recommended to Council that the forecasted overspend of £2.781m regarding repairs and maintenance costs was funded from the following HRA Reserves and that the HRA revenue budgets are increased accordingly.

• £1.000m from the Reactive Repairs Reserve

• £1.781m from the HRA Priorities Reserve

3. Recommended that Council delegates authority to the Deputy Chief Executive and s151 Officer, in consultation with the Cabinet Member for Finance, HR and Economic Development to allocate up to £250k additional funding from the HRA Priorities Reserve to meet any additional financial pressures that may arise during this financial year.

Alternative options considered and rejected

The option of not producing a monitoring report was discounted.

Reasons for the decision

Members should be updated regarding the financial position of the Authority. Effective budget management was critical to ensuring financial resources were targeted towards the Council’s priorities.

Monitoring enabled early identification of variations against the plan and timely corrective action.

Cabinet need to seek Council approval to amend budget frameworks and to increase HRA budgets.

The following points were highlighted during debate:

• The forecasted pressures were highlighted in Budget Monitoring reports seen last month. The projected overspend was £2.781 million.
• The pressures were due to:
  • A clearance of the maintenance backlog
  • Tackling the void turnaround times and improving performance from 79 days in March 2025 to 54 days in August 2025. The number of void properties has reduced from 103 to 68 in the same period.
  • The poor condition properties are being left in by the outgoing tenant and therefore the scale of the works required before the property can be relet.
  • Increasing labour and material costs.
  • Emerging legislative responsibilities and new statutory obligations.
• A preliminary breakdown of the forecast overspend attributable to these factors revealed the following:
  • £1.700m addressing backlog voids and meeting new performance targets.
  • £0.350m inflationary and additional material costs.
  • £0.850m Regulation changes.
  • This report would also be scrutinised by the Finance and Economic Overview and Scrutiny Committee on 18 November 2025.
  • There had been an increased focus to decrease void turnaround times which had contributed towards an overspend on the HRA. However, this had led to increased rent receipts of £458k and reduced void times from 136 days to 79 days (as at July 2025).
  • An example of ‘regulation changes’ was the introduction of Awaab’s Law. This UK legislation mandates social landlords to fix hazards like damp and mould within strict timeframes.
  • There were approximately 6,000 outstanding repairs to council-owned properties 18 months ago; this figure had been reduced to around 2,500.
  • The existing budget was being applied to a regular schedule of repairs to council-owned properties, alongside an inherited backlog.