The Overview & Scrutiny Committee of Southwark Council met on Monday 4 March 2024 to receive updates on major works at Devon Mansions and the Canada Estate, and to review the council's capital programme and housing revenue account budget. The committee noted the progress on remediation efforts and ongoing audits for both estates, and discussed the council's financial plans for the upcoming year.

Devon Mansions Major Works - Update

The committee received an update on the major works at Devon Mansions, focusing on actions and remedial measures since the previous meeting on 29 November 2023. A new Task and Finishing Team (TFT) has been approved and is being recruited, with an experienced lead officer now in post. Recruitment for the remaining TFT positions is underway and expected to be completed by April 2024.

Consultations with residents and ward councillors are ongoing. An independent audit of the works carried out as part of the Quality Homes Improvement Programme (QHIP) is being procured, with resident representatives involved in the appointment process. This audit, expected to be completed by mid-June 2024, aims to identify what went wrong, lessons learned, and recommendations for improvement. A second audit of the Major Works Team will be conducted by the council's internal and external auditors, covering financial and governance aspects. The overall programme for resolving issues at Devon Mansions is forecast for completion between July and August 2024.

Canada Estate Quality Homes Improvement Programme (QHIP) - Update

An update was provided on the major works at the Canada Estate, also addressing actions and remedial actions since November 2023. Similar to Devon Mansions, a new TFT has been approved and is undergoing recruitment, with a lead officer appointed and further recruitment anticipated by April 2024.

Discussions have taken place with the Canada Estate Tenants and Residents Association (TRA) regarding outstanding issues. An independent consultant has been commissioned to assess options for installing balcony access doors in the tower blocks, following concerns that new window designs prevent safe access. The Fire and Building Safety Team is also conducting a review of fire signage across the borough. Intrusive surveys have confirmed the cavity wall insulation remains intact and fit for purpose. An independent audit of the works carried out as part of the QHIP is being procured, with resident involvement in the appointment process, and is expected to be completed by mid-June 2024. A second audit of the Major Works Team will also be undertaken. The council is adopting a more collaborative approach to estate-related matters, including repairs and addressing issues like damp and mould, with expected resolution within 4-6 weeks. The overall programme for the Canada Estate is forecast for completion between July and August 2024.

General Fund Capital Programme Refresh

The committee received information on the refreshed General Fund Capital Programme for the ten-year period to 2033-34. This programme details over 350 specific projects and includes a recalculation and re-profiling of associated funding and costs to ensure affordability and alignment with council priorities. The total budgeted programme amounts to £505 million, with approximately £385 million expected to be funded through borrowing.

Housing Revenue Account Budget

Information was presented on the Housing Revenue Account (HRA) budget for 2024-25. The HRA is facing significant financial pressure due to factors including government rent interventions, unfunded regulatory burdens from the Fire and Building Safety Acts, high construction inflation, and increased interest rates. The council has drafted a two-phase HRA Recovery Plan to address immediate threats and ensure long-term resilience. Phase 1 focuses on reducing revenue spend, temporarily borrowing to fund the asset management capital programme, and disposing of uneconomic assets. Phase 2 aims to restore HRA budgets to a sustainable level, increase reserves, and repay temporary borrowing. The proposed budget for 2024-25 is balanced, with plans to rebuild reserves over the next ten years. The report also detailed a proposed amendment to the council's constitution to increase the threshold for cabinet approval of property disposals from £750,000 to £3 million, aiming to expedite the process and maximise capital receipts to reduce borrowing.

Work Programme

The committee noted the Overview and Scrutiny Committee Work Programme for 2023-24. This document outlines items identified for consideration throughout the municipal year, including updates on major works, budget scrutiny, and policy reviews. The committee also considered the addition of new items or the allocation of existing items to specific meeting dates.