Decision

Cabinet received a report updating them on the Housing Revenue Account (HRA) Medium Term Financial Strategy (MTFS) for the period 2026/27 to 2030/31 and providing an assessment of the long-term sustainability of the Council’s housing finances.  The strategy reflected updated assumptions on inflation, capital investment, borrowing, housing growth and rent policy, including the Government’s proposed rent convergence arrangements from April 2027.   Members noted that while the HRA remained financially viable, the report highlighted continuing pressures from inflation, regulatory compliance, building safety requirements and the need to invest in both existing homes and new council housing.

Members discussed the need to balance investment in existing housing stock, compliance with safety and regulatory requirements, with the continued delivery of new Council homes.  The Portfolio Holder for Housing advised of the challenges associated with the Council’s five high-rise blocks and that arrangements were being put in place to ensure compliance with Awaab’s Law, including the implementation of dedicated teams, systems and training to support the timely reporting and resolution of damp and mould issues.

It was RESOLVED that:

1. That the revised MTFS forecast for the period 2026/27-2029/30 and the projected 2027/28 position be noted.
2. That the inflationary assumptions in section 4.2 be approved for MTFS forecasting purposes.
3. That the pressures set out in section 4.3 be approved.
4. That the savings set out in section 4.4, identified as part of the MTFS review be approved.
5. That the additional LGR costs of £50K in 2026/27 be approved.
6. That the rent convergence programme set out in section 4.5 be agreed in principle. This follows the Government commencing rent convergence from April 2027 with a £1 cap, moving to a £2 cap from April 2028.
7. That the minimum level of balances, set out in section 4.8, be approved.
8. The MTFS be regularly reviewed and revised to reflect any material financial pressures, so forecasts are updated and re-presented to the Cabinet for approval.
9. That the Trade Unions and staff be consulted on the key messages contained within the MTFS and more specifically when drawing up any proposals where there is a risk of redundancy.