Decision details

Received a report on the Housing Revenue Account (HRA) estimates and review of rents and other charges for 2006/07.  Discussed issues relating to the Government’s formula rent system, which intends to bring local authority and Registered Social Landlord (RSL) rent levels into line by 2011/12, and the national HRA subsidy system which, as Barking and Dagenham is assessed as showing a subsidy surplus, will mean approximately £12m being paid from the Council’s HRA to the Government in 2006/07.

Arising from these discussions:

a)  Supported the view that the current formula rent system is unjustly biased against local authority housing and its tenants and that the Government should require RSL’s to reduce rents in order to achieve a convergence, rather than local authorities having to make unnecessary increases;

b)  Noted that the £12m subsidy surplus, which equates to approximately £10 per week per Council tenancy, is used by the Government to support wider, national housing initiatives; and

c)  Supported the view that as Barking and Dagenham is recognised as a ‘deprived’ borough, the subsidy surplus should be able to be retained by the Council for spending towards the Decent Homes Plus standard for all Council-owned stock.

Agreed, in order to meet the Council’s statutory duty to annually review rents and other charges, to ensure rents levels conform with the Government’s rent restructuring proposals, to produce a balanced HRA and assist in achieving the Community Priority of ‘Improving Health, Housing and Social Care’, to:

(i)  The HRA estimates for 2006-07 as set out in Appendix A to the report;

(ii)  Rent increases being calculated in accordance with the rent restructuring formula, as detailed in the report, which represents an average weekly rent increase of £3.07 per dwelling (4.9%);

(iii)  The implementation of Phase 2 of the unpooling of rents in respect of the caretaking service and the upkeep of amenity greens;

(iv)  The increase of heating charges in line with inflation (2.7%);

(v)  The increase of garage rents for traditional garages to £9 per week and multi storey garages in line with inflation;

(vi)  The introduction of a sheltered service charge for tenants not eligible for Supporting People, as detailed in the report; and

(vii)  The above changes taking effect from 3 April 2006.