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Waverley Borough Council Committee System - Committee Document

Meeting of the Community Overview and Scrutiny Committee held on 13/11/2006
DRAFT HOUSING REVENUE ACCOUNT REVENUE ESTIMATES 2007/ 08



Summary & Purpose
As part of the budget process, this report seeks the views of the Committee on the first draft of the Housing Revenue Account (HRA) Estimates for 2007/08. The report provides Members with a preliminary indication of the base estimated position for 2007/08 in advance of any draft Subsidy Determinations from the Department of Communities and Local Government (DCLG).

APPENDIX M
Waverley Borough Council

COMMUNITY OVERVIEW AND SCRUTINY Committee
13TH NOVEMBER 2006
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Title:
DRAFT HOUSING REVENUE ACCOUNT REVENUE ESTIMATES 2007/ 08

[Wards Affected:All]
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Summary and purpose:

As part of the budget process, this report seeks the views of the Committee on the first draft of the Housing Revenue Account (HRA) Estimates for 2007/08. The report provides Members with a preliminary indication of the base estimated position for 2007/08 in advance of any draft Subsidy Determinations from the Department of Communities and Local Government (DCLG).
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Environmental implications:

There are no direct environmental implications as a result of the recommendations attached to this report

Social / community implications:

The current lack of resources within the landlord service in Waverley has implications for the quality of life of Waverley’s housing tenants and the environment in which they live.

E-Government implications:

There are no e-government implications

Resource and legal implications:

There are no direct legal implications as a result of the recommendation of this report. Resource implications are contained throughout the report.
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Introduction

1. On the 30th October the annual Finance Seminar took place at Cranleigh Arts Centre. All Members were invited to attend with copies of the presentation sent to those not in attendance. The seminar covered the development of the Financial Strategy and particularly focused on the main issues regarding the Council’s draft Budget for 2007/2008.

2. The HRA revenue estimates at Annexe 1 highlight the issues and choices facing the Council’s housing service. All aspects of the service are coming under review in an effort to combine improved service delivery with maximising the resources available for supporting the repairs programme and decent homes work.


2007/08 Draft Revenue Estimates

3. The estimate of negative subsidy payable has been prepared in advance of the receipt of Draft Determinations from DCLG. It may be possible to update Members at the meeting.

4. Although the level of supporting people costs to be funded by transitional support is falling, the ongoing reduction of supporting people grant means that there are still some 400k of support costs to be funded by the HRA. Review of this service is ongoing with consideration of different methods of service delivery that may result in cost savings.

5. The increase in housing salaries in the Repairs & Maintenance budget relates to officers involved in cyclical maintenance and represents the final phase of re-aligning the cyclical maintenance costs in line with current audit requirements. There is a corresponding reduction in salaries charged against the capital programme.

6. Also in line with current audit requirements the Trees, Risk Management budget is being moved from the base capital budget to revenue and appears as Hired and Contracted Services, Page 3 line 8.

7. A far-reaching examination of support costs and other recharges is being carried out as part of the 2007/08 budget process as indicated to the Committee in June 2006. The treatment of vacancy savings will be varied so that the HRA will directly benefit from those savings arising from HRA-related posts. This could benefit the HRA by some 50,000 in 2007-08. Also as a result of this review the draft estimates reflect the following changes of budget between HRA and General Fund (GF):

- Removal of the direct recharge for Public Relations from the HRA - 30,000
- Transfer of some of the costs of maintaining the waiting list and housing register to the GF to reflect the new Choice-based lettings service - 88,000
- Reduction in the charge to the Support account for Central Communications - 50,000

8. The process of separating service charges from gross rents has now been completed for tenants in sheltered accommodation. The service charges appear at line 31 on page 5 of the draft estimates.

Budget Variances

9. There are a number of areas within the draft estimates where a variation from the base position for 2007-08 is being proposed. Many of these are target reductions at individual budget level rather than a global target as in the current year. A brief explanation of other significant budget variations within the remit of this Committee for 2007/2008 is given below:

Repairs & Maintenance (Page 2)

10. An annual amount to carry out some external decorating of 250,000, recognizing that a programme of some 700,000 per annum will be required in the longer term. In addition the revenue contribution to capital work is withdrawn.



Supervision & Management General (Page 3)

11. - 10,000 is sought for ditch clearance and maintenance work
Supervision & Management Special (Page 5)

12. - 13,000 water services. There is a need to fund payments in respect of community rooms etc.

Other Income (Page 7)

13. - 10,000 additional income re water rate collection commission reflects current level of income.

Rent Levels

14. In issuing the Subsidy Determinations for 2006-07 the then Office of the Deputy Prime Minister indicated that it would wish to see rents in 2006-07 and 2007-08 rise by no more than 5% on average. A range of rent increase options will be presented to Members in January when there will be a further opportunity to consider the draft estimates.

Conclusion

15. The views of this Committee will be reported to the Executive on 5th December when it will give initial consideration to the draft Budget for 2007/2008. The draft subsidy determinations, which have a critical impact on the HRA revenue budget, are normally issued early in November and the implications will be reported on 5th December. The Executive and Overview and Scrutiny Committees will give further consideration to the Budget in January and February with the final decisions being made at Council on 20th February 2007.

Recommendation

It is recommended that the Committee inform the Executive of its views on the draft 2007/08 HRA revenue estimates.



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Background Papers (DoF)

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: Glennis Pope Telephone: 01483 523252 E-mail gpope@waverley.gov.uk
comms\o&s2\2006-07\052.doc