The Scrutiny Homes Sub-Committee met on Monday 29 January 2024 to discuss the Housing Revenue Account (HRA) and Housing General Fund budgets for 2024-25, and to receive an update on responsive repairs contracts. The committee also reviewed Cabinet's responses to previous scrutiny recommendations and considered its work programme.

Housing Revenue Account and Housing General Fund Budgets 2024-25

The Sub-Committee reviewed the proposed Housing Revenue Account (HRA) and Housing General Fund budgets for 2024-25. Councillor Lynne Hale, Cabinet Member for Homes, introduced the report, highlighting that a 7.7% increase in social tenant rent and service charges was proposed. This increase, which aligns with the Social Rent Policy of September CPI (6.7%) plus 1%, had been discussed with the Tenant and Leaseholder Panel, who understood the rationale but stressed the need to see improvements promptly.

The Sub-Committee was informed that the forecasted overspend in the 2023-24 budget had been managed effectively and was necessary to address a significant repair backlog. The 2024-25 budget would be shaped by four key priorities identified in resident surveys from November 2023. It was noted that the budget would be further reviewed in July, once more information from the ongoing stock condition survey became available. The findings from these surveys will also inform Croydon's Asset Management Strategy, due to be presented to Cabinet in the summer.

Discussions focused on the Period 7 update, with questions raised about the number of voids and completions. Officers explained that 700 voids were expected to be completed in the financial year, with 641 completed by the end of December, attributing the high number to a considerable backlog. The £3.4 million overspend on disrepair, legal, and settlement costs was discussed, with officers emphasising a future focus on prevention and ensuring repairs were completed correctly, linked to cultural change workstreams. Around 5,550 disrepair cases had been accounted for in the budget setting. The Council committed to clearing legacy repairs and voids within 18 months.

Regarding savings, officers explained that the HRA had not had specific savings targets in recent years due to rent increases and general fund savings targets. The main savings achieved were from a service restructure and vacancy factor within the general fund budget, alongside efforts to reduce households in expensive emergency accommodation through occupancy and eligibility checks. It was estimated that approximately one-third of savings were due to vacancies, and two-thirds from efficiencies and improved working methods.

Concerning the HRA budget, officers stated that the next year's budget was based on current data, with plans for additional damp and mould training to enable a more proactive approach to early detection. The damp and mould team would remain permanent, and training in this area was highlighted as crucial for preventing disrepair costs. The transfer of the private sector housing team to the Housing Directorate was discussed, with a need to fill vacancies and increase capacity before this could occur, ensuring a joined-up approach.

The Sub-Committee questioned the use of right-to-buy funds to acquire twenty properties, noting this was an early-stage proposal with other funding options, including grants, being explored. The Council was confident in its ability to acquire at least 20 homes in the current financial year, with potential for more through Greater London Authority (GLA) funding. A clear link between the Housing Strategy and both the General Fund and HRA budgets was emphasised, with a greater focus on data-driven decision-making, evidenced by stock condition surveys. The budget development was informed by resident feedback and identified priorities. The budget for tackling anti-social behaviour had seen an increase in funding for estates and caretaking.

The sufficiency of the budget to support work on domestic violence and abuse was questioned, with officers explaining this was managed by the Violence Reduction Network. Concerns were raised about residents' reluctance to contact housing officers, and the possibility of community safety officers directly serving tenants was discussed as a priority highlighted by residents. Plans to review officers' remits were in place to define the role of housing officers in tackling domestic violence and anti-social behaviour.

The timing of a reduction in housing repair costs was uncertain, with a spike following the introduction of new contractors and the in-house contact centre. The budget was based on a worst-case scenario, and it was difficult to predict when costs would plateau. Inflationary increases for the Regina Road development had been challenging, but the HRA budget had been stress-tested, and prudent assumptions made regarding potential GLA funding. The procurement process for Regina Road was ongoing.

A significant budgetary increase for building safety work, from £8.6 million in 2024-25 to £42 million in 2025-26, was explained as being related to the anticipated completion of stock survey data, which could necessitate costly refurbishments or rebuilding of large panel blocks. These assumptions were high-level and subject to change once survey results were received.

On the General Fund side, the Housing Association Coordination role was confirmed to be transferring to the Housing Directorate, with discussions in progress. The Council was in the early stages of developing a project involving its largest social housing suppliers. Transformation items in the capital budget were still being developed, with most of the transformation budget spread over 2023-24 and 2024-25.

The pace of savings delivery was discussed, with officers explaining that delivery was planned over several years, focusing on demand management and supporting residents in temporary accommodation to avoid eviction. While improvements were noted, some work had not progressed at the expected pace, such as the target for seeing 90% of residents at high risk of homelessness within seven to 14 days. A dynamic purchasing system for emergency and temporary accommodation was being acquired to deliver cost savings. The transformation of temporary accommodation aimed to reduce costs and improve resident engagement, with surgeries scheduled in temporary accommodation. However, budgetary challenges from wider economic conditions had increased costs, though some initial signs of economic improvement and increased central government support were noted.

The achievability of a £653,000 saving for 2024-25 was questioned, with officers assuring it was based on reducing approximately 250 temporary accommodations, with 100 already reduced. Savings were closely aligned with cultural transformation and developing different working practices. Occupancy checks were being prioritised, with transformation funding allocated for additional resources, leading to 60% of checks being completed. The average temporary accommodation placement was driven by supply and availability of affordable accommodation, with stays varying from one to seven years. The term temporary accommodation referred to statutory legislation and criteria, not necessarily the length of stay. There was no guarantee of a move to permanent accommodation, as the application process for temporary accommodation was separate from social housing.

Occupancy checks included verifying renters, housing conditions, and property amendments. The data would inform plans for moving residents from unsuitable living conditions to more appropriate temporary accommodation, and to reduce reliance on commercial hotels. The budget was based on an assumption of increased demand, which would be reviewed. The Council was exploring opportunities to acquire new property for temporary accommodation, including using GLA funding, despite government caps on right-to-buy receipts.

Concerns were raised about hotel placements and payment issues. The Council was attempting to establish a corporate account with Travelodge, its largest supplier, to facilitate longer stays, though initial refusal was based on due diligence. The use of commercial hotels was being minimised, with a dedicated procurement team working with landlords. The dynamic purchasing system was intended to provide information on available agents and landlords. The possibility of the Council acting as a guarantor for residents needing private housing was discussed, but deemed potentially unaffordable for a large number of residents, though it was considered for specific groups. Top-ups for residents nearing private landlord criteria were offered, but communication around these opportunities needed improvement. Capital investment for property efficiency, such as extensions, was managed by the Regeneration Board.

The Sub-Committee concluded that while the Housing service was stabilising and establishing governance processes, there was concern that much of the gathered data, particularly from stock condition surveys, had yet to be analysed, posing a risk to budget delivery. However, they were reasonably reassured that the budget for repairs and maintenance was appropriately sized based on available data. The HRA Capital Programme was considered well-thought-out, with further review expected once stock condition data was analysed. The Sub-Committee was reassured that many concerns were known to the Housing service and work was underway to address them. Savings delivered through the transformation of the Homelessness service were welcomed, but further evidence was required to demonstrate a focus on prevention and early intervention. Risks to the General Fund budget from increased demand for homelessness services were noted. Overall, while total reassurance on the 2024-25 budget was not possible due to data collation, the Housing Service was seen to have a good understanding of pressures and the right priorities.

Responsive Repairs Contract Update

The Sub-Committee received an update on repairs performance, procurement, damp and mould overview, and asset management. Since the new repair contracts went live in August 2023, there had been a significant increase in call volume and repair orders. Issues in the contact centre, primarily due to high sickness absence among temporary staff, were acknowledged, with plans to refresh the centre and implement a new training programme.

Officers explained that the poor performance of the call centre in November 2023 was largely due to sickness among temporary staff. Significant changes were planned over the next six to eight weeks to reduce wait times, targeting five minutes by the end of March and four minutes by the end of May. Staffing levels were informed by six months of intelligence, but the plan included targeting part-time staff for peak periods and accounting for an annual staff turnover of 20-25%.

The heating repair contractor's performance was discussed, with officers stating that performance data was undergoing validation. Targets for emergency repairs were four hours for attendance and 24 hours for completion, and 14 days for non-emergency repairs. Problems were experienced during the first winter of the new contract due to higher-than-resourced demand, with additional resources employed and a focus on prioritising emergency repairs. The issue was twofold: data on stock and required parts, and a high volume of repairs.

The recruitment process for contact centre staff was delayed due to the previous contractor providing staff lists late. Only five staff transferred to the new in-house centre, requiring approximately 22-23 full-time employees. New staff were expected to join in late February and early March. The commercial model for contractors assumed the Council would not pay for operatives, but discussions were ongoing regarding the need for additional supervisors. Currently, seven out of 23 contact centre staff were permanent. Performance issues were primarily attributed to increased demand, not culture.

The NEC system did not currently contain information on the location of stopcocks, but this would be included in staff scripts. The customer satisfaction improvement plan was underway, with ongoing training and an IT tool, 'repair finder', planned for early April. Call monitoring distinguished between new and follow-up calls, with advisors reminded to check repair history. Heat mapping capabilities could identify properties with multiple logged jobs. Sickness absence in November and December was attributed to flu and COVID-19, with no evidence of it being work-inappropriate. Tenancy inspections were being conducted to identify fraud and subletting, and heat mapping could identify properties with a lack of repairs.

Contractor KPIs were being validated before assessment, with clear guidance on minimum standards to be provided. Residents would not yet be able to monitor repair status in real-time, but the portal was being explored for appointment requests by April-June. Informal complaints were logged as issues and captured through the contact centre or officers. The target for turning legacy voids into good condition was 12 days, with current performance averaging 14-18 days. Differences in void measurement between Croydon and other local authorities were noted.

Vulnerable residents were prioritised for gas and heating services, with data on vulnerabilities stored in the NEC system. Most heating-related repairs between October and April were classified as emergency. The contractor was expected to improve service within three months. The contractor's resource issues were partly due to the original contractor pulling out and the Council's focus on gas safety checks. Gas safety check compliance was around 99%, with plans to be close to 100% by March 31st.

The backlog of doable repairs was being addressed, with data validation ongoing. No need to bring in other contractors was identified, as KNT had a clear resourcing and improvement plan. Trends on stock surveys could not be confirmed with certainty as data was still being uploaded. By the end of December, 33% of stock condition surveys were completed, with 40% targeted by the end of March.

The Sub-Committee recommended that void turnaround times be reported separately for lettable and major voids, and that properties with no recorded repairs for extended periods be reviewed to identify potential unreported issues.

Cabinet Response to Scrutiny Recommendations

The Sub-Committee noted the report detailing Cabinet's responses to previous scrutiny recommendations.

Work Programme 2023/24

The Sub-Committee noted the report on its work programme for 2023/24.