Housing Revenue Account Business Plan (To Follow)
Decision maker: The Executive
Decision type: Key
Decision status: For Determination
Is Key decision?: Yes
Is subject to call in?: No
The report provides an update of the current Housing Revenue Account (HRA) Business Plan, taking into account the Council’s HRA self-financing settlement, and discusses some of the potential resource issues and strategic options to be considered when a new Business Plan is developed and published in early 2012/13.
The Executive considered a report which provided an update to the current Housing Revenue Account (HRA) Business Plan and which took into account Sutton’s HRA self-financing settlement. They also considered some of the potential strategic options and resource issues when a new Business Plan was developed and published in early 2012/13.
It was proposed to take out a 30 year loan from the Public Works Loan Board for £141.1m to cover the settlement payment required. The interest rate had been confirmed as 3.5%. This would result in total costs to the HRA to cover interest and debt management expenses of £5.9m. It was noted that under the Business Plan model, a significant reserve should be built up. This could be used (a) to improve revenue funded, day to day services for Council tenants, (b) for further investment in the existing stock, (c) for other housing purposes such as regeneration or new build or (d) a combination of some or all of these options.
Details of the financial modelling that had been undertaken with a view to paying off the loan at the end of the thirty year period were reported.
Resolved: (i) That the strategic investment options available to the Council in light of self-financing and, in particular, options for the early development of local authority new build housing, are presented in the revised HRA Business Plan to be produced in early 2012/13;
(ii) To endorse the recommended approach for treasury management and dealing with the borrowing requirement, which reflects a debt repayment strategy that minimises future risks and optimises flexibility for housing investment.
(iii) To thank Simon Latham for his work on producing a satisfactory outcome for the authority.
Report author: Simon Latham
Publication date: 13/04/2012
Date of decision: 26/03/2012
Decided at meeting: 26/03/2012 - The Executive
- HRA business plan report to 26 March Exec - final draft as at 19-03-12 - amended PDF 112 KB
- HRA Appendix 1 (i) -Revised base model - revenue summary PDF 28 KB
- HRA Appendix 1 (ii) -Revised base model - capital summary PDF 25 KB
- HRA Appendix 2 - HRA BP revised base model assumptions PDF 48 KB
- HRA Appendix 3 -Stock investment requirement as at April 2011 -summary PDF 15 KB
- HRA Appendix 4 - Adopted model - Debt repaid from Year 10 - revenue summary PDF 29 KB