Agenda item

The Cabinet Member for Housing presented a report on the Housing Revenue Account (HRA) estimates, rents and other related charges for 2014/15.

The Cabinet Member advised that the proposed average rent increase of 1.9% was expected to be the second lowest increase by any London borough and would mean that Barking and Dagenham continued to have the lowest Council house rents in London.  Other proposals included a 13% decrease to tenant service charges, equivalent to £3.49 per week, a 9% (£1.32 per week) increase to communal heating and hot water charges to reflect the anticipated increase in energy costs to the Council and a single, standard charge of £11 per week for garages.

The Cabinet Member stated that in order to present a balanced budget for 2014/15, the importance of keeping to a minimum any increase in rents and other charges in such difficult times for local residents had been balanced against the need to continue to provide high quality services.  To that end, the Cabinet Member referred to other key aspects of the overall HRA budget for 2014/15 which included:

·  The significant investment in, for example, new kitchens and bathrooms via the Housing Capital Programme which would help to reduce on-going revenue costs in these areas;

·  The delivery of the repairs and maintenance service via the in-house Direct Labour Organisation;

·  A reduction in management costs as part of an overall £6.1m package of savings;

·  A restructuring of the Estate Management service as part of the overall savings package which would include centralising the service into one team, rather than separate Barking and Dagenham teams, and based from a single location in Pondfield Road, Dagenham alongside the repairs and maintenance service;

·  Continuing to work towards a fairer distinction between rents for houses and those for flats;

·  The introduction of new ‘local supplier’ contracts to enable local businesses to successfully bid for work on behalf of the Council;

·  Supporting new skills initiatives such as the “Step Up” programme via the HRA to help local people into work; and

·  Initiatives aimed at tackling fuel poverty in the Borough.

With regard to the £6.1m package of savings to be achieved during 2014/15, the Cabinet Member confirmed that the savings options would be the subject of consultation along the lines of previous years’ savings for General Fund services, with the final proposals presented for the Cabinet’s approval as appropriate.

Cabinet resolved:

(i)  To approve the Housing Revenue Account estimates for 2014/15 as detailed in Appendix 6 to the report, subject to the agreement of saving proposals which will be reported to Cabinet separately;

(ii)  To approve the use of HRA balances where savings are not fully delivered in 2014/15, in order to achieve a balanced budget;

(iii)  To approve an overall average Council dwelling rent increase of 1.9%, equivalent to £1.69 per week and comprising the following:

·  New build and acquired Council homes (rents set at 50% of local market rents or at affordable rents above this (65%)) - 3.7% average increase, consistent with Government policy of RPI+0.5% as per Affordable Homes Programme.

·  Other houses - 2.3% average increase.

·  Other flats - 1.4% average increase.

(iv)  To approve a decrease to tenant service charges of 13% (£3.49 per week);

(v)  To approve an additional provision for communal heating and hot water charges of 9% (£1.32 per week), which represents the anticipated rise in energy costs to the Council for these services;

(vi)  To approve a single, standard charge of £11 per week for garages and a further review of parking spaces;

(vii)  To approve the increase in rents for commercial properties in line with lease agreements; and

(vii)  That the above changes shall take effect from 1 April 2014.