Agenda item

Consideration was given to a report of the Finance Manager which set out the latest Housing Revenue Account (HRA), the detailed budget estimates for 2022/23, the strategic estimates for the four years 2023/24 through to 2026/27 and outturn estimate for 2021/22. The report also set out the recommended

dwelling, non-dwelling rents and service and concierge charges to be applied from April 2022.

The report set out the proposed HRA 2022/23 original budget and the forecast outturn for 2021/22 along with the provisional strategic budgets for 2023/24 through to 2026/27.

HRA activities were a key element of the Council’s Housing Strategy (approved by Council on 10 July 2019) which aimed to provide a diverse Oldham housing offer that was attractive and met the needs of different sections of the population at different stages of their lives.

After taking all relevant issues into account, the projected financial position for 2021/22 was estimated to be a £4.828m positive variance when compared to the original budget forecast for 2021/22 approved at the Budget Council meeting, 4 March 2021. Of this variance, £1.756m was attributable to a higher than anticipated brought forward balance from 2020/21 and the remaining £3.072m was as a result of the re-profiling of HRA funded capital schemes into later years due to revisions to planned spending profiles. The estimated

balance at the end of 2021/22 was projected to be £22.291m.

The financial position for 2022/23 showed an estimated HRA closing balance of £ 20.483m which was sufficient to meet future operational commitments and the potential financial pressures identified in the risk assessment.

The 2022/23 position had been presented after allowing for an increase in dwelling rents of 2.1%, an increase in non-dwelling rents in line with individual contracts, the freezing of all service charges and the setting of Extra Care Housing concierge charges to fully recover costs.

The current policy guidance for the period 2020-2025 was that all rents were calculated based on a maximum of the Consumer Price Index (CPI) rate in September of the preceding year plus 1%. Oldham’s projections for the 2022/23 budget had been set assuming rental increases of 2.1% which was 2% lower than if it were to follow the maximum uplift (September 2021 CPI rate being 3.1% plus 1%). The Council had opted to propose the reduced rate

given the current healthy levels of HRA balances and the ongoing pressures, including inflation, on household incomes.

The financial projections for the HRA over the period 2021/22 to 2026/27 showed an overall reduction in the level of balances from £22.291m at the end of 2021/22 to £8.123m at the end of 2026/27.

HRA resources were to be used to support several major approved housing capital projects including development within the town centre and on smaller sites around the borough. There was also a commitment to purchase currently empty properties owned by private sector landlords to increase the number of Council owned housing stock.

The HRA detailed budget for 2022/23 and strategic estimates for the four years 2023/24 to 2026/27 and the outturn estimate for 2021/22 were presented to the Policy Overview and Scrutiny Committee for consideration and comment.

RESOLVED that the following be accepted and commended to Cabinet, the:

1.    Forecast HRA outturn for 2021/22 (as per Appendix A)

2.    Proposed HRA budget for 2022/23 (as per Appendix B)

3.    Strategic estimates for 2022/23 to 2026/27 (as per Appendix D)

4.    Proposed increase to dwelling rents for all properties of 2.1%.

5.    Proposed increase to non-dwelling rents as per individual contracts.

6.    Proposal that service charges are unchanged from those of 2021/22.

7.    Proposal to set Extra Care Housing concierge charges to fully recover actual costs.