The Scrutiny Homes Sub-Committee was scheduled to discuss the financial outlook for the Housing Revenue Account and the Housing General Fund for the upcoming year, 2026-27. The committee was also set to review the Cabinet's response to previous recommendations made by the Sub-Committee and consider its work programme for the remainder of the municipal year.

Update on the Housing Revenue Account and Housing General Fund Budgets 2026-27

The Sub-Committee was scheduled to review proposals concerning savings and growth for both the Housing Directorate General Fund Budget and the Housing Revenue Account (HRA) Budget for the 2026-27 financial year. This review was intended to inform feedback for the Scrutiny & Overview Committee's Budget Scrutiny session on 10 February 2025.

The report detailed proposed savings for 2026-27 totalling £5.99 million. These savings were to be achieved through a combination of the Stabilisation Plan Efficiencies (£3.94m), Target Operating Model (TOM) savings (£1.1m), and business as usual savings derived from demand management, contract reviews, and staffing reviews from prior years.

Growth proposals for 2026-27 amounted to £4 million, confirmed as part of the 2025-26 Medium Term Financial Strategy (MTFS). An additional £6.6 million in growth was planned to align with a new Homelessness, Rough Sleeping and Domestic Abuse Grant, following changes in how the Homelessness Prevention Grant (HPG) is awarded.

The report also outlined the forecast outturn for the Housing General Fund, which was projected to underspend by £3.1 million against the £3.9 million Stabilisation savings targets. However, it noted significant pressure on this budget due to ongoing demand for temporary accommodation (TA). The report highlighted that London boroughs were experiencing record levels of homelessness, with Croydon ranking seventh among boroughs with high numbers in TA. An action plan was in place to manage increasing TA demand, including an 'appointment only' system for assessments, visits to households experiencing family exclusion, and promoting self-service housing options. The report also detailed a growing gap between the Council's costs for TA and the Housing Benefit subsidy received.

For the Housing Revenue Account (HRA) budget principles, the report indicated that the full business plan and budget would be presented to Cabinet on 11 February 2026. The budget was based on a property profile of 13,347 social rent, 296 affordable rent, and 7 shared ownership properties. Rents were assumed to increase in line with the Social Rent Policy, which would result in a 4.8% increase. The draft revenue budget for 2026-27 was based on an income budget of £107.9 million against an expenditure budget of £101 million. Staffing budgets had been increased to support a structure that meets statutory demands, with no savings targets in this area. A proposed £24 million budget for responsive repairs was noted as being above the London average. The draft capital budget proposed a continuation of £101 million, with £45 million allocated for major works, including fire and safety. The HRA Business Plan demonstrated that investment proposals were fundable and the HRA remained sustainable over a 30-year period, based on available data.

The forecast outturn for the HRA for Period 8 (November 2025) indicated a breakeven position. Responsive repairs costs were being controlled, with a forecast of 11,000 jobs for the remainder of the year. Disrepair claims remained a concern, with 1,124 open cases as of November. The new grounds maintenance contract had commenced on 1 November 2025. The HRA capital programme was forecast to underspend by £17.9 million due to the profiling of the Regina Road project, which would be reprofiled as part of the 2026-27 budget setting. The major repairs and improvements programme was forecast to be fully committed and spent. The Regina Road project's financial position had informed the revised HRA Business Plan, with Pellings supporting the procurement of the main build contractor. The property buy-back programme was forecasted to purchase 103 units in the financial year.

The report also included appendices detailing the 2025-26 Period 8 Financial Performance Summary, the 2026-30 Medium Term Financial Strategy Update, and a summary of savings in the Stabilisation Plan.

Homes Scrutiny Recommendations - Cabinet Response

The Sub-Committee was scheduled to be presented with the Cabinet's response to recommendations previously made by the Sub-Committee at its meeting on 19 June 2025. The Sub-Committee was asked to note the responses and consider if any further action was necessary.

The appendix to this report detailed the scrutiny recommendations and the Cabinet's responses. Two recommendations were rejected: one concerning the inclusion of specific housing-related targets in the Stabilisation Plan business cases, and another regarding extending post-placement contact with residents in out-of-borough placements. The Cabinet stated that a Target Operating Model update had been provided and that the contract with providers included follow-up procedures. A recommendation to explore compensation clauses in out-of-borough contracts for failure to deliver properties was also rejected, with the Cabinet explaining that payment was contingent on the property being suitable and meeting assessment criteria, and that levying further charges would be commercially unacceptable. A recommendation for a wider impact assessment of housing actions on other departments and the voluntary sector was rejected, with the Cabinet stating that issues should be raised through the active Homelessness Forum.

One recommendation was partially accepted: to include extra care and sheltered accommodation voids in the Stabilisation Plan to encourage downsizing. The Cabinet noted that elderly residents in temporary accommodation were offered sheltered housing where suitable, and a programme was underway to promote general needs and sheltered housing to under-occupiers, including introducing a resettlement service.

Work Programme 2025-2026

The Sub-Committee was presented with an update on its work programme for the 2025-26 municipal year. The final version of the report had been presented to the Scrutiny & Overview Committee on 22 July 2025. The Sub-Committee had the opportunity to discuss any proposed amendments or additions to the work programme.

The report noted that the 26 January 2026 meeting was scheduled to be the final meeting of the municipal year. To hold additional meetings, a request would need to be submitted to the Scrutiny & Overview Committee for approval. Members were invited to suggest other items for the Work Programme, with a suggestion that no more than two substantive items be included per meeting to allow for effective scrutiny. Members were also asked to consider who they wished to invite to future meetings to assist in the consideration of agenda items.

The completed work programme was attached as Appendix 1. The programme included items such as the Stabilisation Plan, updates on KPIs focusing on repairs, the PSR Licensing Scheme, the Allocation Policy, and reviews of Registered Social Landlords. The agenda for the 26 January 2026 meeting was set to include a General Fund Budget Deep Dive and a review of the Housing Revenue Account Budget/Business Plan, both forming part of the budget-setting process and feeding into the Scrutiny & Overview Committee meeting on 10 February 2026.