The Director of Housing will give a verbal update on the impact of the required rent reductions.
Minutes:
This item was considered at the same time as Housing Transformation Programme.
The Director of Housing gave the meeting a presentation on the Housing Transformation Programme which covered the following matters:
- The size /scope and work areas covered by the programme – the Project would include a wide programme of service reviews and make savings, increase efficiency and increase investment.
- The 1% rent reduction would have a significant detrimental impact on the level of investment and would mean additional savings would be required.
- Detailed reviews would take place for each service area, which would include engagement with staff, Members and service users.
- Changes agreed so far were outlined, including, changes to communal cleaning and tenants undertaking small repairs.
- Efficiency achievements were also noted including the reduction in outstanding repairs jobs and increase in lettings.
- Details of the planned organisational staffing review, were provided which would cover approximately 50% of the division’s staff.
- The next steps were outlined which noted the reduced rental income which meant that service reduction or rescheduling of investment would be inevitable.
Members raised queries on the following matters.
A query was raised about the timescale for the staffing review. The Director replied that reviews were often subject to change depending on the individual circumstances of the review. Broadly, the first consultation draft of the business case proposal would be prepared for late Autumn, with the consultation period ending in January. It was anticipated that the review would be complete in June.
A table which showed the reduction in rental income across the housing stock was requested. The Director agreed to provide this. She did however note that it would be a small amount for each individual tenant, ie. 86 pence on a weekly rent of £86.
The Chair invited the Executive Member for Housing to give the Commission his view / comment. He noted that he originally envisioned that rents would stay low during his tenure, but even keeping the rent increase to 1% as was previously the plan would have been difficult, but the reduction of 1% created major challenges. He noted that the government justification, of increases in social sector rents, these were minimal in comparison to private sector increases in recent years. He felt that the reduction was purely to reduce the level of housing benefit payments. He expressed disappointment that the reduction would mean decreased level of investment in the city stock. He also noted that housing associations faced particular challenges with having to deal with right to buy for the first time, which meant they too were unlikely to build new homes in the city. He referred to the graph in the presentation which showed over a 10 year period there would be a £12m gap between the previously expected rental income and what was now likely. This would have funded the provision of 106 new homes. He noted that there were three main areas of expenditure for housing, day to day running costs, income management and major investment, but it wouldn’t be possible to do all 3 of these at the current level in future, but any changes would be delivered following consultation. He also commented that the Government had made pronouncements about devolving powers, but this change was imposed without discussion. Overall he thought that most tenants would prefer investment in their homes and environment rather than a minimal reduction in rent.
A query was raised about how the programme and subsequent expected reductions in investment would be communicated to tenants, particularly as there were already concerns regarding the progress of the kitchen and bathroom programme? The Director commented that initially there would be discussions with the Tenants Forum and a workshop held to look at the issues. Once a budget had been designed, there would be a communications programme with tenants on a wider basis. She noted that it would be a difficult time for staff, but time would be allowed for meetings and discussions to go through the issues and concerns. Overall, she noted that the £12m in reduction was disappointing, but there would still be £60-70 million spent on council housing in the city.
The Chair, in summary felt that reductions of this sort were to be expected from the government, but he felt that the city had proven itself well capable of managing difficult situations based on good communications with its tenants.
RESOLVED:
That the Commission to receive reports on later stages of the programme and associated reviews at the relevant time.