Agenda item

(Cabinet Member with Special Responsibility Councillor Hamilton-Cox)

Joint Report of Chief Officer Housing & Property and Chief Officer Resources  (report published on 7.2.25)

(Cabinet Member with Special Responsibility Councillor Caroline Jackson)

Cabinet received a joint report from the Chief Officer for Housing & Property and the Chief Officer Resources (Section 151 Officer) that sought Cabinet decisions on Council Housing rent setting proposals and HRA revenue and capital budget proposals.

The options, options analysis, including risk assessment and officer preferred option, were set out in the report as follows:

The options with regards to rent setting are set out under section 4, the maximum permitted increase being CPI+1%. By applying this increase, it allows for a budget that can deliver on the Council’s ambitions on improving housing standards and addressing the climate change emergency, whilst adhering to the Rent Standard and wider legislative requirements.

In relation to garage rents, it is recommended that following recent rent freezes an increase in line with dwelling rent increases is appropriate and will support maintenance requirements without adversely impacting occupancy levels.

With regard to the revenue budget generally, Cabinet could consider other proposals that may influence spending in current and future years, as long as their financing is considered and addressed and coherent with the legislative and regulatory requirements of a Registered Provider.

The options available in respect of the minimum level of HRA balances are to retain the level at £750K in line with the advice of the Section 151 Officer, or adopt a different level. Should Members choose not to accept the advice on the level of balances, then this should be recorded formally in the minutes of the meeting and it could have implications for the Council’s financial standing, as assessed by its external auditor.

The options available in respect of the Capital Programme are:

i)               To approve the programme in full, with the financing as set out;

ii)              To incorporate other increases or reductions to the programme, with appropriate sources of funding being identified.

Any risks attached to the above would depend on measures Members proposed, and their impact on the council housing service and its tenants. As such, a full options analysis could only be undertaken once any alternative proposals are known, and Officers may require more time in order to do this.

The officer preferred option is Option 1: Set housing and garage rent levels as set out in this report and approve the provisions, reserves and balances position (and their use); the revenue budgets and capital?programme, as set out and refer onto full Council.

The budget headlines were presented to the Tenants Voice meeting on 30th January 2025 who were broadly in agreement with the proposals described, including the rent increase. There was, however, a range of debate which should be noted including:

· That details of planned maintenance and capital programmes be presented to a future meeting of the Tenant Voice

· That the housing service should remained focussed on improving performance to ensure value for money in the context of a rent increase.

The budget headlines and the wider context of housing finances were presented and discussed at the Council Housing Advisory Group (CHAG) on 31st January 2025.

Cabinet have been consulted on the budget, rent setting proposals and other budgetary matters at their meeting of 14 January 2025.

The report highlights challenges faced within the current economic climate, particularly in the context of the increased regulatory and legislative requirements being placed on the social housing sector.

The longer-term financial forecasts contain numerous estimates and assumptions, and the service remains attuned to the risks contained within Appendix F, and in particular the impacts of further legislative and regulatory change which could affect business planning within the HRA.

Councillor Caroline Jackson proposed, seconded by Councillor Hamilton-Cox:-

“That the recommendations, as set out in the report, be approved.”

Councillors then voted:-

Resolved unanimously:

(1)        That the minimum level of HRA unallocated balances be retained at £750,000 from 01 April 2025, and that the full Statement on Reserves and Balances as set out at Appendix E be endorsed and referred on to Budget Council for approval.

(2)        That council housing rents be set in accordance with statutory requirements as follows:

             · for existing tenancies, rents will increase by 2.7% from 7 April 2025

             · for new tenancies within 2025/26, rents will be set at ‘formula rent’

(3)        That garage rents be increased at CPI +1% in line with dwelling rents

(4)        That a delegated decision to approve the tender of two programmes of work (over £200K and key decisions over £250K) during 2025/26 can be made by the Chief Executive (as per 7.4 in the report) and in line with procurement rules.

(5)        That further to consideration on 14 January 2025, the Housing Revenue Account budget for 2025/26 onwards, as set out at Appendix A to the report, together with the resulting Capital Programme as set out at Appendix C to the report, be referred on to Budget Council for approval.

Officers responsible for effecting the decision:

Chief Officer for Housing & Property

Chief Officer Resources (Section 151 Officer)

Reasons for making the decision:

Lancaster City Council’s Housing Service remains ambitious, while continuing to operate a sensible but forward-looking approach, seeking to meet Regulatory requirements and deliver safe and decent homes

The decision is consistent with the Council Plan.  The proposals set out in the report impact positively on residents within Council Housing dwellings specifically in relation to climate change, wellbeing / social value, health and safety and community safety.