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Waverley Borough Council Committee System - Committee Document

Meeting of the Community Overview and Scrutiny Committee held on 10/09/2002
Consultation Paper - The Way Forward for Housing Capital Finance Suggested Response



This report contains a proposed response to the issues raised in the consultation paper published by the Office of the Deputy Prime Minister (ODPM) in August 2002.
APPENDIX F

WAVERLEY BOROUGH COUNCIL

COMMUNITY OVERVIEW AND SCRUTINY COMMITTEE – 10TH SEPTEMBER 2002

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Title:
CONSULTATION PAPER – THE WAY FORWARD FOR HOUSING CAPITAL FINANCE
SUGGESTED RESPONSE

[Wards Affected: N/A]
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Summary and Purpose

This report contains a proposed response to the issues raised in the consultation paper published by the Office of the Deputy Prime Minister (ODPM) in August 2002.
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Introduction

1. In June 2002, the Government published a draft Local Government Bill for consultation containing issues that have significant financial implications. The previous item on the Agenda (Capital Receipts Group) outlined the way in which the issue that will most fundamentally affect Waverley and other debt free local authorities is being addressed. This report is concerned with the further consultation paper that focuses on the housing capital finance regime . It clarifies, to some extent, proposals outlined in the draft Bill and in doing so makes specific proposals on which the views of local authorities are sought. 2. The Government’s proposal to pool and then re-distribute Housing Revenue Account (HRA) right-to-buy receipts is predicated on two assumptions:

a) That there are a number of local authorities that have little housing need and, therefore, do not need the resources they are generating; and b) There are a number of local authorities that have housing need but choose to spend their HRA capital receipts on non-housing activities. 3. The consultation paper does not identify these local authorities. As Members will be aware, Waverley has a significant need/demand for affordable housing and there is a backlog of repairs on the council housing stock. 4. As an introduction to the Council’s response, it would be worth making the following points: Capital Receipts Pooling

5. The consultation paper outlines a proposed regime for the pooling of a proportion of the right-to-buy receipts of all local housing authorities. Views are invited on the following:-

The proposal that certain types of receipt should be exempted from pooling provided they were used for specific purposes; Which receipts should be excluded from pooling under such a system; and, What limitations should there be on the expenditure on which excluded receipts might be spent? 6. The following response is suggested. Local Authority Social Housing Grant (LASHG)

7. Members will be aware that Waverley currently commits half of its estimated right-to-buy receipts to fund a social housing capital programme. The funding provided to Registered Social Landlords (RSLs) in this way is reimbursed to Waverley by the Housing Corporation and, because Waverley is debt free, this reimbursement can then be used for other capital spending. The ODPM has decided that this regime is too complex and seeks to simplify the system by suggesting two possible options.

Provision of resources through the Approved Development Programme(ADP),or Replacing LASHG with a simple system in which local authorities make direct grants to RSLs having consulted the Housing Corporation about the choice of RSL and having had regard to priorities set out in the Regional Housing Strategy
Conclusion

8. It is suggested that the response concludes as follows:
Recommendation

It is recommended that the Committee:-

1. endorses the proposed response highlighted in the report, adding such further comment that it deems appropriate, and

2. commends the proposed response for approval by the Executive

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Background Papers (DoF)

Consultation Paper – The Way Forward for Housing Capital Finance (ODPM August 2002)
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CONTACT OFFICER:

Name: Ms G Pope Telephone: 01483 523252

E-mail: gpope@waverley.gov.uk


comms/o&s2/2002-03/040