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Waverley Borough Council Committee System - Committee Document

Meeting of the Executive held on 07/12/2004
Housing Revenue Account - Application of Capital Receipts Arising from Non-Right to Buy Receipts



Summary & Purpose
The Local Government Act 2003 introduced new pooling arrangements for capital receipts arising from the sale of Council dwellings. This requires Councils that sell dwellings under the Right-to-Buy (RTB) to pass 75% of the receipt to central government. A similar rule applies to capital receipts arising from disposals of non-RTB assets, although 50% is pooled. However, there is a dispensation that where a local authority spends the receipt on affordable housing or regeneration schemes or makes a formal resolution to do so, the Council can retain all of the receipt, rather than passing a proportion to the government.

This report advises members of a non-RTB capital receipt that is likely to arise shortly and proposes that the Council resolves to expend these sums in relation to affordable housing schemes.

Quality of Life Implications
Natural Resource Use
Pollution Prevention and Control
Biodiversity and Nature
Local Environment
Social Inclusion
Safe Communities
Local Economy
Natural
Resource Use
Pollution
Prevention and Control
Biodiversity
and Nature
Local
Environment
Social
Inclusion
Safe, Healthy
and Active
Communities
Local
Economy
N/A
N/A
N/A
N/A
Positive
Positive
Positive


APPENDIX AA

WAVERLEY BOROUGH COUNCIL
EXECUTIVE – 7TH DECEMBER 2004

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Title:
HOUSING REVENUE ACCOUNT – APPLICATION OF CAPITAL RECEIPTS ARISING FROM NON-RIGHT
TO BUY RECEIPTS

[Wards Affected: All]
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Note pursuant to Section 100B of the Local Government Act 1972

The annexe to this report contains exempt information by virtue of which the public is likely to be excluded during the item to which the report relates, as specified in paragraph 9 of Part 1 of Schedule 12A to the Local Government Act 1972 viz:-

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Summary and purpose:

The Local Government Act 2003 introduced new pooling arrangements for capital receipts arising from the sale of Council dwellings. This requires Councils that sell dwellings under the Right-to-Buy (RTB) to pass 75% of the receipt to central government. A similar rule applies to capital receipts arising from disposals of non-RTB assets, although 50% is pooled. However, there is a dispensation that where a local authority spends the receipt on affordable housing or regeneration schemes or makes a formal resolution to do so, the Council can retain all of the receipt, rather than passing a proportion to the government.

This report advises members of a non-RTB capital receipt that is likely to arise shortly and proposes that the Council resolves to expend these sums in relation to affordable housing schemes.

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Quality of life implications – social, environmental & economic (sustainable development):

E-Government implications:

There are no E-Government implications arising from this report.

Resource and legal implications:

There is a significant benefit to the Council to formally resolve to use the anticipated capital receipts for a particular housing purpose, as it will then not be subject to capital receipts pooling, but will benefit the Waverley area, rather than a proportion being given to Central Government to be re-distributed nationally.

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Background

1. The Local Government Act 2003 introduced new pooling arrangements for capital receipts arising from the sale of Council dwellings. This requires Councils that sell dwellings under the Right-to-Buy (RTB) to pass 75% of the receipt to Central Government. This pooling mechanism came into effect on 1st April 2004.

2. A similar rule applies to capital receipts arising from disposals of non-RTB assets, although 50% is pooled. However, there is a dispensation that where a local authority spends the receipt on affordable housing or regeneration schemes or makes a formal resolution to do so, the Council can retain all of the receipt, rather than passing a proportion to the government.

3. The Council is due to dispose of some Housing Revenue Account assets that will give rise to a capital receipt viz: a small parcel of land forming access to the Wyphurst Road site in Cranleigh, where 79 affordable homes for local people are to be developed by Downland Housing Association.

4. The capital sum arising from this disposal is detailed in the (Exempt) Annexe to this report.

5. The Council has many demands on its finite resources and there is a pressing housing need in the Borough. The Council also has aspirations to redevelop a number of sites, currently in its ownership, over the next few years in order to better meet local housing need. It is considered appropriate that the Council should use these resources to meet housing need locally, rather than transfer a proportion to the Office of the Deputy Prime Minister.

6. Members will be aware that the Council has resolved to redevelop two sites – at Dorlcote, in Witley and at Rowland House, in Cranleigh – once the buildings have been vacated by occupants. In order to retain these sites for affordable housing, a level of subsidy will be required, over and above the land itself, for whichever organisations undertake the redevelopment of new affordable homes.

7. This report recommends that the capital sums arising from the sale of land at Sherrydon, Cranleigh, and at Wyphurst Road, Cranleigh, be applied to the redevelopment of the Dorlcote and Rowland House sites in due course.

Recommendation

It is recommended to Council that the capital sums arising from the sale of land at Wyphurst Road, Cranleigh, be applied to the redevelopment of the Dorlcote and Rowland House sites in due course.

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Background Papers (DoH)

There are no background papers (as defined by Section 100D(5) of the Local Government Act 1972) relating to this report.

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CONTACT OFFICER:

Name: Mr J Swanton Telephone: 01483 523375

E-mail: jswanton@waverley.gov.uk

comms/executive/2004/2005/327