The Director of Environment and Neighbourhood Services submitted a report seeking retrospective approval for bids for additional borrowing capacity within the Housing Revenue Account (HRA) and for supporting grant funding from the Homes England Affordable Housing Programme.

The report summarised the bids submitted for an additional £33,180,400 of borrowing capacity within the HRA and £7,920,000 of Affordable Homes Programme Grant Funding, to support a £47,916,000 development programme for up to 170 new additional affordable homes in the Borough.  This would comprise Phase 3 of the Council’s new build homes programme. 

The report noted that retrospective approval was required, as the tight timescale from announcement to deadline had meant bids were still being developed and the financial implications assessed up to the submission deadline.  The bids had been submitted on 30 September 2018.  Acceptance of any funding offers was subject to Committee approval and the individual scheme proposals were subject to community consultation and planning approval. 

The report noted that, further to the submission of the bids the Prime Minister had announced the intention to remove the HRA borrowing cap for local authorities.  The Government’s aim was to remove the cap as soon as possible which would mean that the Council would be able to develop the proposed schemes, regardless of the outcome of this bidding round, subject to affordability within the HRA and securing supporting grant funding from the Homes England Affordable Housing Programme or an alternative form of subsidy.

The report set out the currently projected annual financial impact on the HRA, including the impact on HRA reserves, were all bids to be approved and schemes delivered.  Due to the significant scale of the proposed development and its potential impact on the Council’s wider responsibilities to maintain existing housing services and stock, an external validation of the current HRA Business Plan had been commissioned to ensure that the appraisal of the impact of these proposals was robust. A further report would be submitted to the Committee with a recommendation on the final rental mix once this exercise had concluded.

Resolved –

(1)     That the submitted bids for additional HRA borrowing capacity totalling £33,180,400 and Affordable Homes Grant of £7,920,000 to finance the development of 170 new additional affordable homes in the Borough be retrospectively approved, and the Director of Environment and Neighbourhood Services, in consultation with the Director of Resources, be authorised to accept any subsequent offers of funding;

(2)     That a further report be submitted to a future meeting of the Committee with a final recommendation on the rental mix (Social Rent and/or Affordable Rent), following the current independent review of the Housing Revenue Account Business Plan.