Agenda item

1.    RESOLVED TO RECOMMEND  that Council approves the updated Housing Revenue Account Business Plan 2021/24

2.    RESOLVED TO RECOMMEND that Council approves the revised

development programme budgets as set out in Section 9.3.

3.    Cabinet also agreed to delegate the approval of the additional grant

funding to the Corporate Director of Finance and

Regeneration to award grant funding up to £1.4M to support the development of affordable housing units, by Thrive at the two waters site in Hemel Hempstead.

Decision

RESOLVED TO RECOMMEND that Council approve the updated Housing Revenue Account Business Plan 2021/24

RESOLVED TO RECOMMEND that Council to approve the revised development programme budgets as set out in Section 9.3.

It was agreed to delegate approval of the additional grant funding to the Corporate Director of Finance and Regeneration to award grant funding up to £1.4M to support the development of affordable housing units, by Thrive at the two waters site in Hemel Hempstead.

Corporate Objectives

Delivering Affordable Housing.

Monitoring Officer

A stock retained local housing authority must maintain a Housing Revenue Account in accordance with section 74 of the Local Government Act 1989.

Further to section 76 of the 1989 Act, local housing authorities must formulate and implement proposals to ensure that for each financial year the Housing Revenue Account does not show a debit balance.

The annual review provides a robust mechanism to monitor the business plan to ensure that it takes account of the changes in government policy, law and economy and therefore meets the Council’s statutory requirements.

Deputy S.151 Officer

There are a number of inflationary assumptions inherent within the Business Plan which are liable to change over the planning period, and which could therefore pose a risk to delivery.

These assumptions are kept under constant review, and this report is the annual update of the HRA business plan.  The way in which the Council structures its borrowing will influence the amount of funding available in future years. Borrowing options, together with any implications for the future programme, will be presented to Members in advance.

There is the possibility of unanticipated government interventions that could impact on the HRA business plan in particular the current projections of annual rent increases which are set at is CPI +1% for next 5 years. The Council endeavours to maximise the use of housing grants to deliver affordable homes and in order to do this awards additional grants to registered providers to support affordable homes growth and opportunities for residents. If these grants were not fully utilised by the council the funds would be redistributed by MHCLG, and Dacorum and its partners may incur interest charges.

Advice

Cllr Griffiths introduced the report and welcomed questions.

Cllr Elliott referred to page 4, item 3.2 and commended all the officers involved that the work has been done and hasn’t dipped due to COVID during 2020.

Cllr Griffiths agreed the officers have worked very hard under very difficult circumstances, noting that applies across the board in Housing as there has been additional stress across the whole service.

FWilliamson referred to the table in 3.2 advising that the updated figures haven’t been included for this financial year, it goes to 19/20.  Advising that kitchens & bathroom upgrades were suspended during COVID in occupied properties as it would involve too much traffic within homes and present too great an infection risk; the resource was instead focused on upgrades in void properties.

Cllr Williams referred to paragraph 7.7 of the report, the additional funding to Thrive Homes and asked what difference that makes to the scheme?  Does it change what is being officered?

FWilliamson advised that they are setting up a ‘rent to buy’ model.  There are 10 units for shared ownership that have now been moved into this rent to buy model which offers security of tenure for the 5 years rental, after which time they would have the option to purchase the property.  Thrive are offering support to cover any legal costs and any stamp duty that would be required to be paid at that time. 

Cllr Williams asked, at the end of the 5 years, if they don’t exercise the right, can they continue renting?

FWilliamson responded that Thrive have worked the model up to provide security of tenure for that full 5 years.  If at the end of that 5 years they were not able to afford to buy, Thrive are working up a process for them to be able to continue to rent. 

FWilliamson added that this is an intermediate rent model spanning from our upper earning threshold for social housing (£60k for affordable social rent, as we operate within our Allocations Policy) so households looking at this scheme would be those in the £50k to £80k household income bracket.

Cllr Griffiths asked, if at worst case scenario, no one exercises right to buy, it will make the scheme unviable for Thrive.  Is there a chance they could come back and ask for more funding in 5 years’ time?

FWilliamson responded no, if the scheme becomes unviable there must be some security of tenure they can provide to those tenants, as we are providing grant funding on the basis of affordable housing, and if that scheme was to become unviable for those housed within it, it would be Thrives risk, not ours. Delegation of authority allows up to 1.4M of additional grant funding but on the basis that we will ask Thrive to sign up to a legal agreement.

Recommendations agreed.