The report was introduced by the ADH and set out the HRA Business Plan and Budget for 2018/19 after reviewing it for the next 30 years. A range of areas were identified where efficiencies and improvements could be made in relation to HRA activities to free up resources to enable reinvestment into the service. Following the results of the Stock Condition Survey, the estimated investment required to maintain and improve the current housing stock for the next 30 years would be £452,447,897.

Every opportunity would be pursued to secure extra funding for new-build homes and to deliver improved value for money as a modern social landlord. As mentioned in the Briefing Note brought forward by the ADH earlier in the meeting, the Council would be bidding for the £1 billion additional borrowing. Overall, the Business Plan was robust and viable which would keep the HRA on path.

The Vice-Chair queried on the costs of fire safety such as sprinkler systems, in high rise blocks. The ADH said the government position was to ensure residents were kept safe and a case could be made to the DCLG during the bidding of the additional funding. The fire services have limited funding to ensure fire safety and many Boroughs could request funding for fire safety within their bidding narratives.

Commenting on the £5 million cost to build 500 homes as part of the regeneration scheme within Thurrock; the Vice-Chair asked if it was possible for Thurrock to set up its own Housing Association to build these homes. The ADH explained that Housing Associations were now seen as private entities. Setting one up would be complicated and would not give the Council much financial freedom if the HRA was still the vehicle for delivery. Working in partnership with a housing association would not enable the build of 500 homes but would enable the Council to purchase more homes and repair older homes and to utilise Right to Buy receipts, as outlined in the report.

At 9.20pm, Members agreed to suspend standing orders until 10.00pm to enable all items on the agenda to be heard.

Referring back to the garages review, Councillor Redsell queried on what the outcome would be. The ADH said the garage review would check whether garages were being effectively used to maximise the revenues. Business processes such as mainstream lettings for the garages and costs for repairs, demolition and reprovisions were being reviewed which would give a clearer picture and provide solutions. Councillor Redsell went on to ask whether the service department knew what was stored within the garages and if these were checked. The ADH answered that the report would not be detailed in this aspect but the service department would check what the garages were used for.

Referring to the Council’s bid for the additional borrowing from DCLG, Councillor Pothecary asked whether the service department’s plans would be dependent on winning the additional funds. She also asked would the much needed homes within Thurrock be dependent on the private sector building new homes. She also queried what the additional funds would be spent on and how many projects would be funded. The ADH explained that the DCLG were refining their criteria for the additional funds and looking at Local Plans. If simple criteria were used, a small number of London boroughs might see all extra funds allocated to them. It could not be guaranteed that Thurrock Council would meet the DCLG’s criteria once known. The cost of a regeneration scheme over the next 10 – 15 years would be in the multi-millions but there were many upfront costs and fees for purchasing leaseholds as well as demolitions so the ADH could not answer with a single statistic. The funds from DCLG would potentially be to complement other funds or to bridge a funding gap. It could potentially be used to help fund the regenerations of four of the estates within Thurrock that met the social deprivation, density and other relevant criteria, for a range of projects or for viable schemes.

Councillor Pothecary thanked the ADH for his detailed explanation in answer to her questions. She further asked whether there were any concrete statements made from the DCLG that could be highlighted. The ADH stated that £400 million’s worth of extra funding would be good to enable Thurrock to deliver additional social housing. There were still a range of initiatives to be released and there was a comment within the House of Commons’ briefing paper regarding something of a shift to investment in social housing rather than home ownership. The Chair questioned the readiness of the Council to take advantage of any funding to which the ADH replied that they were in a good position to do so.

Referring to Housing Associations, Councillor Allen asked how their rents compared to council rents. The ADH explained that rents from Housing Associations were generally higher. These used an affordable rent model for new lettings which was 80% of the market rent but was still cheaper than private rents.

The Chair referred to 3.5 of the report which had a £15 million requirement per year in regards to capital investment across all aspects. He asked what the cost implications of this would be down the line. The ADH said that there would be less spend on responsive repairs which made up most of the weight of the budget. The figure of repairs and maintenance was £10.5 million which was not the same as the Transforming Homes project. Responsive repairs would eventually be shifted into a planned approach which would give an idea of clearer costs.

In regards to the excess £9.5 million of unallocated receipts that the Council had in 3.10, the Chair questioned whether this money would be given back. The ADH stated that the report sets out the requirement to repay the money back if it was not used. It was possible to do what was outlined in the report so the money could be spent on new build developments but it would also be subject to other developments around Thurrock. The Chair went on to ask whether the money could be used to buy stock off the market to which the ADH replied it could not be done without matching the funding.

The Vice-Chair commented on the local plan to build 32,500 homes and gave a scenario of private developers purchasing land off the Council to build luxury homes instead. He asked how the Council’s housing department would spend the money in this scenario. The ADH replied that this was known as commuted sums. The service department had a number of sites assessed by Thurrock Regeneration Limited (TRL) and if the scenario given was to happen, then the sums could be deployed immediately to the TRL sites.

RESOLVED:

1)    That the Housing Overview and Scrutiny Committee commented on the assumptions reflected in the HRA Business Plan, as summarised in the report.

2)    That the Housing Overview and Scrutiny Committee commented on the budget formation which was also provided.