1. HRA Rent and Budget Setting 2016/17 1

2. The Housing Revenue Account The Housing Revenue Account (HRA) is a ring fenced account which cannot be subsidised from the General Fund and any surplus or deficit in the HRA is carried over to the next financial year The HRA operates under the self financing regime introduced by Government in April 2012 This required the Council to take on approx. £170m debt and develop a 30 year business model Proposals for this budget setting year continue to be driven by the financial planning that underpins the model to deliver services and capital investment 2

3. Lambeth Housing Standard The full LHS programme is estimated at £490m, one of the highest such schemes nationally The programme is supported by Decent Homes Government Grant Funding totalling £124m c£90m capital expenditure expected in the current year, with the 16/17 and 17/18 planning totals currently being revised This requires careful management of the finances to ensure there is adequate funding to support the programme whilst maintaining sufficient reserves The works have meant more tenants benefitting from major capital investment to their homes 3

4. The General HRA balance as at 31 March 2015 was £10m HRA projected outturn for 2015/16 includes a budgeted £600k contribution to HRA balances Aim is to hold General HRA balances of 5-10% (Currently £10m) on a sustainable basis and use balances above that to deliver the capital investment programme Housing Revenue Account 4

5. Housing Management: Performance (Sept 2015) 95.9% of collectable rent, including arrears, has been collected (target 95.1%) Voids at 2.6% – it takes less than 34 days to re-let empty homes 5

6. Setting The Rents: Rent Policy Following the Summer 2015 budget there is an enforced rent reduction of 1% per year for the next four years Overall goal is to support the HRA 30-year business plan in terms of service delivery and capital investment The reduction in rents compared to the current business plan is expected to create a £28.4m funding shortfall once the full four- year impact is factored in Savings options are currently being explored to manage this shortfall within the HRAs management costs and efficiencies, but cuts on this scale will impact on frontline provision If we were to do nothing to reduce expenditure, the HRA would be bankrupt within three years 6

7. Rent Summary 1% Rent Reduction Average rent PW (£)£109.17 Average decrease PW (£)£1.10 Average decrease PW (%)1% 7

8. Impact – 1.0% Decrease Bedrooms% of dwelling stock Avg weekly rent 2015/16 Avg weekly rent 2016/17 Average Decrease % Decrease Studio3.76%£81.19£80.37£0.811% 1 Bed28.07%£94.62£93.68£0.951% 2 Bed34.91%£108.12£107.03£1.081% 3 Bed26.42%£124.43£123.19£1.241% 4 Bed5.57%£143.68£142.25£1.441% 5 Bed0.92%£157.34£155.77£1.571% Over 5 Bed0.35%£168.34£166.65£1.681% 8

9. Decreases for individuals BracketNo. of occupied properties % of occupied properties £0.66 - £0.85 1,6947.21% £0.86 - £1.05 8,78037.36% £1.06 - £1.25 8,61336.65% £1.26 - £1.45 2,91712.41% £1.46 - £1.65 1,1955.08% Over £1.65 3031.29% Sub Total 23,502 Void Properties 705 Grand Total 24,207 9

10. Service Charges Service charges are set on the basis of recovering the estimated cost of providing the service There will be a small decrease in common service charges Charges for garages, parking and sheds are subject to a detailed review and we will provide more information to Tenants Council in December 10

11. Charge2015/16 (per week) 2016/17 (per week) Movement% Common service charges Caretaking1.57 1.40 (0.17)(11.00%) Grounds Maintenance1.46 0.00 0.00% Estate Cleaning6.34 6.50 0.16 2.50% Communal Lighting2.82 2.90 0.083.00% Disinfestation0.97 0.82 (0.15)(15.50%) Total 13.1613.08(0.08)(0.50%) Heating and Hot Water (Average) 13.8615.021.168.50% Service Charges Proposal 11

12. Charge2015/16 (per week) 2016/17 (per week) Movement% Specific service charges TV Aerial 0.33 0.27 (0.06)(18.00%) Concierge 13.76 16.34 2.5819.00% CCTV 2.35 2.33 (0.02)(1.00%) Door Entry – Audio 1.49 1.47 (0.02)(1.50%) Door Entry – Video 2.25 2.23 (0.02)(1.00%) Total 20.18 22.64 2.4612.00% Service Charges Proposal (cont’d) 12

13. Concierge As of April 2016 the concierge service charge will be based on a full recovery of costs A report to Housing Scrutiny Sub-Committee in October 2012 suggested a three year increase of £3.10 per week to bring the charge up to £18.64 in line with costs This was superseded by a report in October 2013 which suggested the increases for 2014/15 and 2015/16 should be 66p, which has brought the figure to the current charge of £13.76 This second report was based on cost figures that excluded costs related to services delivered by two TMO’s (Holland Rise and Loughborough EMB) and therefore the current charge does not fully recover costs To bring the charge to full cost recovery, the proposal is to increase the charge by £5.15 per week. This is proposed to be staggered over two years with an increase of £2.58 per year for 2016/17 and 2017/18 13

14. Meeting Timetable Tenants’ Council – 17 November Cabinet Meeting – 11 January 14