Agenda item - Housing Rent Setting

Key Decision

Portfolio Holder: Cabinet Member (Outward), Councillor John Wilmott

a) that an average rent decrease of 1% for all council house rents be set for 2019/20.

b) that an average rent increase for garages, at the level of the Consumer Price Index (CPI) be set for 2019/20.

c) that the amenity charge be increased by 61p a week for 2019/20.

d) that the charges for communal heating be increased by 3% for 2019/20.

e) that the water charges at Brook Street Court be increased by 4% for 2019/20.

REASON FOR DECISIONS

a) To set a 1% rent decrease as detailed in Section 23 – 33 of the Welfare Reform and Work Act 2016.

b) To set an increase of CPI only on garage rents to continue covering the increasing costs of maintenance and rental collection for the Council garage sites, consistent with the approach in previous years.

c) To increase the amenity charge to recover the near full costs of providing the services which do not fall within the provision of the rent charge.

d) To set an increase to the communal heating service charges. This is to cover the increase in prices from the utility company to the Council for providing the communal heating in the applicable housing court schemes.

e) To set an increase to the service charge for water at Brook Street Court to cover the increase in prices from the utility company to the Council for providing water at Brook Street Court.

ALTERNATIVE OPTIONS CONSIDERED AND REASONS FOR REJECTION

a) There are no other options with regards to rent setting, to not set the rents as per the prescribed reduction would be contrary to legislation.

b) The garage rent option considered was for a lower percentage but this would have a detrimental effect on the HRA and not cover the inflationary increase in costs incurred in 2019/20.

c) To not increase the amenity charge to the proposed level would mean that the service would continue to not have full cost recovery of the additional services provided and this would adversely impact the HRA balances.

d) The increase in the communal heating service charge is calculated to cover the costs of providing the heating to the housing court schemes. To not increase the service charge would mean the costs are inappropriately subsidised by the HRA i.e. the other rent payers.

e) The increase in the water service charge to Brook Street Court is calculated to cover the costs only of providing the water to the Brook Street Court tenants. This follows strict guidance from OFWAT and no other option is available.

The Corporate Finance Manager submitted a report seeking approval for the proposed rent level and other council accommodation related charges for council tenants for the financial year 2019/20.

Since April 2016, the Welfare Reform and Work Act 2016 had required social housing rents to be reduced by 1% a year for 4 years from a frozen 2015/16 base line, for both social rents and affordable rents, with 2019/20 being the fourth year of the reduction. It was noted that this reduction had over the period resulted in a loss of £8million to the Housing Revenue Account for the Council. The Leader noted that while other charges were increasing, these increases would be offset by the rent decrease which would mean that residents would not be financially disadvantaged by the increased charges. It was also noted that charges made by the Council, including garage rents and the amenity charge did not cover the full costs incurred in providing these services and that full cost recovery on these services was not made in order to protect the welfare of residents as far was possible.

RESOLVED