Issue - meetings

To submit the report of the Director of Function (Resources)/Section 151 Officer.

It was resolved to note the following –

·        The position set out in respect of the financial performance of the Housing Revenue Account (HRA) for Quarter 3 2025/26.

·        The forecast outturn for 2025/26.

The report of the Director of Function (Resources)/Section 151 Officer which set out the financial performance of the HRA for the period from 1 April 2025 to 31 December 2025 was presented for the Executive’s consideration.

Councillor Gary Pritchard, Leader introduced the Quarter 3 HRA budget monitoring report.

The Director of Function (Resources)/Section 151 Officer reported on the overall position noting that the HRA shows a £715k revenue overachievement against the profiled budget at Quarter 3 2025/26. The forecast year-end revenue underspend is £546k, and capital expenditure is forecast to be £864k under budget. The combined revenue and capital deficit forecast is £8,436k which is £1,403k better than planned and reduces the amount of external borrowing required. By Quarter 3, a total of 29 units have been added to the housing stock, including newly developed houses as well as existing properties acquired and refurbished by the HRA. Further developments and acquisitions are progressing as shown in Appendix C to the report.

The opening balance of the HRA reserve stood at £7.976m.The budget allowed for the use of £6,820k of this balance, leaving the minimum level of reserve balance of £1,155k as set out in the HRA Business Plan. After capital budget and grant adjustments, the net revenue/capital deficit budgeted for the year is £8,436k. This is to be funded from the HRA reserve and £1,616k in external borrowing.

Councillor Gary Pritchard referred to the challenges facing the HRA  which were raised during the Corporate Scrutiny Committee meeting last week. While the Council is pleased to  maintain rents at a level below what the Trussell Trust recommends as fair rent, its inability to raise rents to housing association levels places pressure on the HRA, particularly as it is also expected to fund improvements to ensure the housing stock continues to meet the Welsh Housing Quality Standards.

Councillor Carwyn Jones, Portfolio Member for Housing and Community Safety confirmed that achieving the Council’s ambitions for new build, acquisitions and development alongside investment in the existing stock and meeting WHQS requirements remains a significant  challenge especially as revenue income is not keeping pace with rising costs. The Council is grateful for grant funding and is keen to ensure rents remain affordable. Nevertheless, choices will need to be made - either grant income must increase, WHQS requirements must be eased, or the Council must review its ambitions. Borrowing is another option, but the Council does not wish to burden the HRA with excessive debt.

It was resolved to note the following –

·      The position set out in respect of the financial performance of the Housing     Revenue Account (HRA) for Quarter 3 2025/26.

·      The forecast outturn for 2025/26.