Agenda item

The Committee were reminded that a Call In had been received requesting that consideration be given relating to the Housing Revenue Accounts rents policy and Cabinet’s decision at its meeting in October 2016 to approve it.

The Interim Strategic Director, Regeneration, Housing and Resources, Mike England informed Members of the rationale for the proposal to charge higher rents on new build properties. The proposal in the Business Plan was for rents to be at 80% of market rent or the Local Housing Allowance (LHA) rate, whichever was the lower. In most cases this was likely to be the LHA rate, which was around 70% to 75% of the market rent, depending on property size. This approach had been adopted to ensure that the homes would still be available to residents claiming Housing Benefit.  In all other respects, including security of tenure and tenants’ rights, the position of tenants remained the same as in any other council tenancy. It was noted that the proposal for immediate implementation of the higher policy derived from the fact that 23 new properties were due to be handed over to the Council before the end of march 2017. If a standard council rent was charged on these properties they would be subject to the Government’s controls on existing rents and it would therefore not be possible subsequently to increase rent levels to the higher rates. It was explained that over the 30 year life of the Business Plan the additional rent income on these properties was significant and would be beneficial to the HRA.

It was brought to the Committee’s attention that a number of factors had contributed to a change in policy including that the current position on the Housing Revenue Account was that the Council did not have a clear picture of either its income or its required expenditure over the life of the Plan and as a consequence did not know if the account is viable in the medium and long term. In this period of uncertainty, these new build properties represent the only significant source of additional income available to the Council and this income may be required to sustain investment in existing homes as well as to build new ones.

Members were informed that the reserves to fund the new build programme were a one off and if the Council charged higher rents on these new build homes it could fund the building of more new council homes. There is a trade-off between rents charged and the number of new homes which can be afforded. This is a position facing all local authorities now in a situation there is now no national subsidy available for affordable rented housing.

Mr England also outlined the Government’s intention to introduce new Pay to Stay arrangements from April 2017. This would result in households with a gross income of more than £31,000 paying more rent, with the additional income paid back to the Government. Under this new policy, some existing tenants will pay more in their current homes and some may pay more in the newly-built homes. If the higher rent structure is adopted on the new homes, the extra rent would be retained in Slough rather than going back to the Government.

Mr England stated that prior to any formal consideration of the Call In there had been further developments relating to the implementation of the higher rent policy. Legal issues surrounding the lettings policy on the new properties had meant that implementation had been delayed and it was anticipated that letting of these properties would not now take place until early 2017.

Councillor Swindlehurst, a signatory to the Call In, addressed the Committee outlining the reasons why a Call In had been submitted.  It was argued that the manner in which the decision had been taken conflicted with the Council’s

requirements for transparency, due notification and scrutiny when making such service changes. It was requested that the matter be deferred and considered as part of the complete review of the HRA Business Plan in March 2017. The possibility of using Development Initiative Slough Housing (DISH) to take the properties was raised. It was noted that the rules regarding the use of Right To Buy receipts were likely to be outside the remit of DISH, although an appraisal would be made to see if this was possible.

Councillors Morris and Plenty also addressed the Committee under Rule 30. Concerns relating to a lack of social housing in the Borough and under utilisation of certain properties were raised. Charging to the General Housing Fund and the importance of accurate record keeping were also highlighted. The meeting was informed that the issues raised could be examined as part of the budget process and review.

Resolved –  That consideration of the Call-In be deferred to the 12 January 2017 meeting.