cabinet - bassetlawdata.bassetlaw.gov.uk/media/631683/cb100117non.pdf · cabinet . agenda ....

CABINET

AGENDA

Extraordinary Meeting to be held in the Ceres Suite, Worksop Town Hall, S80 2AH

on Tuesday, 10th January 2017 at 6.30pm (Please note time and venue)

Please turn mobile telephones to silent during meetings. In case of emergency, Members/officers can be contacted

on the Council's mobile telephone: 07702 670209.

In accordance with the Openness of Local Government Bodies Regulations 2014, audio/visual recording and photography at Council meetings is permitted

in accordance with the Council’s protocol ‘Filming of Public Meetings’.

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CABINET Membership 2016/17 Councillors: K Dukes, J Evans, S A Greaves, J A Leigh, D G Pidwell, S Scotthorne,

S E Shaw and J White Substitute Members: None Cabinet Members:

Policy, Strategy and Communications: Councillor S A Greaves Co-operatives and Corporate Services: Councillor K Dukes Finance: Councillor J Evans Health and Community Wellbeing: Councillor S E Shaw

Housing: Councillor S Scotthorne Infrastructure and Strategic Transport: Councillor D G Pidwell

Neighbourhoods: Councillor J A Leigh Regeneration: Councillor J White Advisory Members: Councillor H M Brand (Non-Voting) Liaison Members: Councillors H Burton, S Fielding, K H Isard and T Taylor (Non-Voting) Quorum: 2 Members Lead Officer for this Meeting Mr N Taylor - Ext 3266 Administrator for this Meeting Mrs J A Hamilton - Ext 3146

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EXTRAORDINARY MEETING OF CABINET

10th JANUARY 2017

AGENDA

1. APOLOGIES FOR ABSENCE

2. DECLARATIONS OF INTEREST BY MEMBERS AND OFFICERS * (pages 5-6)(Members’ and Officers’ attention is drawn to the attached notes and form)

(a) Members(b) Officers

SECTION A – ITEMS FOR DISCUSSION IN PUBLIC

Key Decisions

3. REPORT(S) OF THE CABINET MEMBER – CO-OPERATIVES AND CORPORATESERVICES *

(a) Council Tax Reduction Scheme (Bassetlaw District Council) 2017/18 (Key DecisionNo. 587) (pages 7-27)

4. REPORT(S) OF THE CABINET MEMBER – FINANCE *

(a) Calculation of Council Taxbase 2017/18 (Key Decision No. 602) (pages 29-34)(b) Business Rates Budget 2017/18 (Key Decision No. 603) (pages 35-38)(c) Housing Capital Programme 2017/18 to 2021/22 (Key Decision No. 604)

(pages 39-47)(d) Housing Revenue Account Budget 2017/18 to 2019/20 (Key Decision No. 605)

(pages 49-58)

Other Decisions

None

Exempt Information Items

The press and public are likely to be excluded form the meeting during the consideration of the following items in accordance with Section 100A(4) of the Local Government Act 1972.

SECTION B - ITEMS FOR DISCUSSION IN PRIVATE

Key Decisions

None

Other Decisions

None

* Report attached

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NOTES: 1. The papers enclosed with this Agenda are available in large print if required. 2. Copies can be requested by contacting us on 01909-533146 or by e-mail

[email protected]

EFFECTIVE DATE OF DECISIONS 1. All key decisions made at this meeting will be referred to the Overview and Scrutiny

Committee and will not come into force until that Committee has considered the decisions and has decided not to "call in" any decision.

2. A copy of all non key decisions will be sent to all Members of the Council and any four

Members may then, within five days, request that any particular decision be referred to the Overview and Scrutiny Committee - in which case the particular decision will not come into force until that Committee has considered the decision and has decided not to "call in" the same. If no such request is made decisions will come into effect at the end of the five day period.

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mailto:[email protected]

Agenda Item No. 2

DECLARATION OF INTEREST

COMMITTEE ………………………………………………………………………………

DATE ……………………………………………………………………..

NAME OF MEMBER : ……………………………………………………………………………… Type of Interest 1. Disclosable Pecuniary 2. Non Pecuniary Agenda Item

No. REASON * Type of Interest

(1 or 2)

Signed

Dated

Note:

* When declaring an interest you must also state the nature of your interest. Completion of this form is to aid the accurate recording of your interest in the Minutes. The signed form should be provided to the Minuting Clerk at the end of the meeting. A nil return is not required. It is still your responsibility to disclose any interests which you may have at the commencement of the meeting and at the commencement of the appropriate Agenda item.

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DECLARATION OF INTERESTS

HOW TO USE THIS FORM

There are now only two types of Declaration of Interest: Disclosable Pecuniary Interests ) Details can be found in the Councillors ) Code of Conduct which is contained in ) the Council’s Constitution (a summary is Non Pecuniary Interests ) printed below) Upon receipt of the attached form you will need to enter the name and date of the Committee and your own name. By looking at the Agenda you will no doubt know immediately which Agenda Items will require you to make a Declaration of Interest. Fill in the Agenda Item number in the first column of the form. Enter the subject matter and any explanations you may wish to add in the second column. In the third column you will need to enter either if you are declaring a disclosable pecuniary interest, or a non pecuniary interest. The form must then be signed and dated. Please remember that if during the actual meeting you realise that you need to declare an interest on an additional Agenda Item number please simply amend the form during the meeting. The form must be handed into the Committee Administrator at the end of the meeting. NB. The following is a summary prepared to assist Members in deciding at the actual meetings their position on INTERESTS it is not a substitute for studying the full explanation regarding INTERESTS, which is contained in the Council’s Constitution and the Code of Conduct for Councillors, which is legally binding. Members and Officers are welcome to seek, PREFERABLY WELL IN ADVANCE of a meeting advice from the Council’s Monitoring Officer on INTERESTS.

Disclosable Pecuniary Interests Action to be Taken May relate to employment, office, trade, profession or vocation carried on for profit or gain May relate to sponsorship May relate to contracts May relate to interests in land May relate to licences to occupy land May relate to corporate tenancies May relate to securities

Must disclose to the meeting - existence of the interest - the nature of the interest - withdraw from the room - not seek improperly to influence a decision on the matter

Non Pecuniary Interests Action to be Taken May relate to any body of which you are a member or in a position of general control or management and to which you are appointed or nominated by the Council May relate to any person from whom you have received a gift or hospitality with an estimated value of at least £25 A Member may also have a non pecuniary interest where a decision in relation to that business might reasonably be regarded as affecting wellbeing or the wellbeing of other council tax payers, or ratepayers or inhabitants in the electoral division or ward, as the case may be, affected by the decision. . (Note – there are special provisions relating to “Sensitive Interests” which may exclude the above provisions in certain circumstances.)

Must disclose to the meeting - existence of the interest - the nature of the interest - not seek improperly to influence a decision on the matter.

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Agenda Item No. 3(a)

BASSETLAW DISTRICT COUNCIL

CABINET

10th January 2017

REPORT OF THE DIRECTOR OF CORPORATE RESOURCES

THE COUNCIL TAX REDUCTION (BASSETLAW DISTRICT COUNCIL) SCHEME 2017/18

Cabinet Member: Co-operatives and Corporate Services Contact: David Hill Ext: 3174

1. Public Interest Test

1.1 The author of this report, David Hill, has determined that the report is not confidential.

2. Purpose of the Report

2.1 To propose options for the Council’s scheme for Council Tax Reduction (CTR) for 2017/18. This must be in place (following Council approval) by 31st January 2017, to come into effect from 1st April 2017. This will replace the Council Tax Reduction (Bassetlaw District Council) Scheme 2016/17.

3. Background

3.1 Amendments to section 10 of the Local Government Finance Act 2012, effective from 1st April 2013, included the requirement for each billing authority to set a local scheme by the end of January for Council Tax Reduction by way of discounts for residents in “financial need”.

3.2 The Secretary of State has the powers to prescribe by regulations, additional requirements which must or must not be included in a scheme. These are contained within The Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012 and the Council Tax Reduction Schemes (Prescribed Requirements) (England) (Amendment) Regulations. These regulations are updated annually, in December and essentially protect people of pensionable age from the restrictions a Local Authority may have in its local Council Tax Reduction Scheme. It also includes provision to allow for annual uprating of allowances and premiums from 1st April without this being classed as a material change to the scheme, which would then require consultation.

3.3 The Department for Communities & Local Government (DCLG) also issued guidance on other administrative matters to be considered, such as duties to vulnerable people, and that although not mandatory, schemes should contain work incentives. The Bassetlaw CTR Scheme currently contains all of these in the form of income and earnings disregards (in line with Housing Benefit levels), and protection from restrictions for severely disabled people (working-age vulnerable).

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3.4 Prior to 1st April 2013, all local authorities were reimbursed the full costs of awarding council tax benefit via a subsidy grant from central government. In order to reduce the financial pressures of the Welfare system, the Chancellor introduced changes to the system which required local authorities and residents to take a share of the financial burden.

The current Council Tax Reduction Scheme 2016/17 3.5. The Council set the 2016/17 Council Tax Reduction Scheme in January 2016, (coming into

force from 1st April 2016) and it is based on the previous Council Tax Benefit, means-tested scheme with minor adjustments, but is still similar to rules associated with Housing Benefit. This is the fourth year of the new arrangements, however there have been reductions in Government grants year on year since its implementation. The Council has kept the impact of this to a minimum so far by merely amending the Maximum liability on which to calculate CTR entitlement, which currently stands at 90% for working age claimants who are not in the Vulnerable class. People of pension age can have their entitlement calculated on 100% liability due to the protections within the Government’s prescribed scheme, as stated in paragraph 3.2 above.

3.6 The main features of the 2016/17 CTR local scheme for working-age residents are:

The scheme identifies each class of person entitled to a reduction. The current scheme has the following classes:

Scheme Class Description Maximum

CTR Class A

Pensioners whose income is less than the applicable amount

100%

Class B Pensioners whose income is greater than the applicable amount

100%

Class C Pensioners - alternative maximum council tax reduction (second adult rebate)

100%

Class D Persons who are not pensioners whose income is less than the applicable amount

90%

Class E Persons who are not pensioners whose income is greater than the applicable amount

90%

Class F Does not apply to the Bassetlaw scheme – previously working-age second adult rebate

Not applicable

Class G Persons who are not pensioners who are protected under this scheme (severely disabled vulnerable class)

100%

A maximum limit on the net Council Tax liability (after other discounts) used to calculate

Council Tax Reduction is set at 90% for those residents in class D and E of the scheme. Those of pensionable age and those who are working-age but severely disabled (vulnerable) are still calculated based on 100% of the liability.

The Council’s definition of a person within Class G is where the claimant or partner

qualifies for the Severe Disability Premium in the calculation of Housing Benefit or other Department for Work and Pensions (DWP) benefits. This class of person is protected from any restrictions and therefore their Council Tax Reduction is based on 100% liability.

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The Bassetlaw Scheme also includes a full disregard of War Disablement Benefit and War Widows/Widowers Pension, agreed under the Council’s Housing Benefits and Council Tax Reduction (disregard of income) Local Scheme Policy.

An additional fund of £30K has been set aside under the Council Tax Discretionary Fund

Policy to offer help to those experiencing exceptional hardship. It can also be used to fund any further discretionary reductions to the Council Tax due as prescribed under section 13A 1(c) of the Local Government Finance act 2012 e.g. for successful appeals.

The current scheme has no backdating provision for awards of Council Tax Reduction.

Second Adult Rebate for working-age claims (Class F) was not included in Bassetlaw’s

scheme from April 2013, but is included for people of pensionable age under the prescribed requirements (Class C). This is where, in certain circumstances, the income of another adult in the property (if less than the claimant’s) can be used instead.

Funding Arrangements 3.7 In 2012/13 the cost in Bassetlaw of the previous statutory council tax benefit was circa £9.1m.

By introducing the new council tax reduction scheme for 2013/14, the Chancellor cut the cost of welfare by 10%, meaning that local authorities would only receive 90% (£8.19m) of the cost of providing council tax benefit as a reimbursement, giving a shortfall of £0.91m to be shared amongst the precepting authorities.

3.8 The reimbursement grant is payable as part of the Revenue Support Grant (RSG) mechanism

in proportion to the Council Tax bill i.e. County 74%, Bassetlaw 11%, Police 11% Fire 4%. For Bassetlaw, the total extra cost of the year one scheme was circa £0.91m and due to the proportional reimbursement a net cost of £0.1m for the authority. This shortfall was funded through a one off transitional grant and the 92% maximum CTR scheme for the local residents. Funding reductions in subsequent years have been offset by additional revenues collected and a reduction in the number of people entitled to CTR.

3.9 The CTR funding is no longer separately identified or ring-fenced and it is reasonable to

assume that it has therefore been reduced in line with the annual reduction to the Revenue Support Grant (currently averaging 31% reduction per year). Government plans include reducing the RSG to zero by 2020 and amending the rates retention scheme to 100% business rates retention from 2020. The potential loss in funding for the next 4 years and Bassetlaw’s share of that funding loss is estimated at circa £330K. If we also allow a contingency for any increase in the numbers claiming within one of the protected groups, e.g. pensioners and the severely disabled, up to 2020, this could rise to a shortfall of £450K which has to be bridged by any combination of:

• reducing the total spend on the Council Tax Reduction Scheme; • raising more income through changes to the Council Tax empty property discounts; • additional income raised through Business Rates Retention; • raising income through other service efficiencies.

3.10 Previous shortfalls between the cost of the CTR scheme and the Government funding have

been met by tax base growth, amending the Council Tax discounts on empty properties (which raised £0.6m), and decreasing spend on the scheme itself by changing the maximum entitlement available in 2014/15 from 92% to 90% (which saved £0.1m). In 2013-14 the Government also awarded a one off transitional grant of £0.2m.

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3.11 The changes in caseload, the impact of working age becoming pensioners and the rise in claims from the vulnerable group impact on the cost of the scheme overall.

Caseload and Expenditure 3.12 The existing scheme was agreed for 2016/17 based on a caseload and expenditure forecast,

including a 3.4% Council Tax increase. The caseload has shown a reducing trend overall since year one of the new scheme, however the Vulnerable group has shown an increase of 90% since year one. Pension age claims have fallen by approximately 17% since year one. However, the estimates show that a further 112 cases will become pensioners in 2017/18 adding an estimate £250K to the cost of the scheme. As these two schemes are protected at 100%, any change in caseload can impact on the funds available for the rest of the groups within the scheme. The table below shows the caseload figures at April each year and the current caseload, which shows it does fluctuate throughout the year;

3.12.1 Caseload Trends

3.12.2 Expenditure Trends- the cost of CTR scheme

Claim Group

2013-14 2014-15 2015-16 2016-17 estimate

Pension-age (prescribed scheme)

£4,13m £3.97m £3.76m £3.68m

Vulnerable group (severely disabled)

£0.32m £0.44m £0.50m £0.63m

Working-age –other

£3.20m £2.83m £2.73m £2.70m

Working-age employed

£0.63m £0.55m £0.52m £0.51m

CTR SUB TOTAL £8.28m £7.79m £7.51m £7.52m Discretionary Hardship Fund

£0.020m

£0.025m

£0.025m

£0.030m

TOTAL £8.30m £7.81m £7.53m £7.55m

Claim Group

Caseload @ April 2013


Caseload @ April

2015


Current

caseload @ November

2016 Pension-age (prescribed scheme)

5024 4763 4524 4260 4159

Vulnerable group (severely disabled)

360 374 486 558 683

Working-age other

3954 3569 3335 3182 854

Working-age -Employed

1054 1024 998 920 3029

SUB-TOTAL

10392

9730

9343

8920

8725

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The 2017/18 CTR Scheme estimated cost and options consultation 3.13 Looking forward to 2017/18, it is assumed that the County Council will once again raise council

tax to support social care. The predictions below therefore include an estimate of the increase in Council Tax plus an estimate for those claimants who reach pensionable age (as explained in paragraph 3.12). For 2017-18, It is estimated that the new pensioners would add another £0.01m plus a 1.95% rise in Council Tax would add another £0.15m to the cost of the scheme, making a total of £0.25m extra cost before any changes are made to the scheme itself.

3.14 Based on the estimated withdrawal of Revenue Support Grant and the estimated expenditure

shown above, the shortfall increases. This means that during the period 2017-2020 the Council would have an estimated funding shortfall for its contribution to the council tax reduction, based on the current scheme, of £0.450m. This requires careful monitoring over the next three years as the cost of the scheme can fluctuate year on year.

3.15 The impact of this withdrawal has been considered and full consultation has taken place on

various options to meet the gap in funding for 2017/18 and beyond. A shortlist of options has been compiled and discussed, taking into account the responses to the consultation which made clear that residents and support partners want the scheme to be fair across all groups. (A copy of the consultation summary is attached at appendix A). The consultation exercise included 8000 direct mailings to all working age CTR qualifiers and the same number of non-qualifiers of all age groups, spread across the district. It also included press releases, inclusion in other fares undertaken by the Council e.g., flu sessions and directly with parish councils, our partners and support groups such as Citizens advice, North Notts Support partnership and A1 Housing.

3.16 The options considered for the 2017/18 scheme and the reasons for the proposed option are

set out in section 5 of this report.

Claim Group

Caseload estimate 2017-18

Estimated expenditure £m 2017/18 (current scheme)

Pension-age (prescribed scheme)

4265 £3.86m

Vulnerable group (local scheme)

663 £0.62m

Working-age employed (local scheme)

830 £0.51m

Working-age other- Unemployed (local scheme)

2946 £2.78m

SUB-TOTALS

8704 £7.77m

Additional sum CTR Discretionary hardship awards

30,000

Total estimated expenditure budget requirement 2017/18 with no scheme changes

£7.80m

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Proposed Council Tax Reduction Scheme 2017/18

3.17 There are many variables that form the basis of the current scheme, and these have all been very carefully considered taking into account the consultation responses and the scope of changes that are allowed within the working age scheme, to ensure that the funding gap is met as fairly as possible across all groups. To keep the scheme as it is would cost the Council a further £251K in 2017/18, and with reducing funding, this is not sustainable. The Government’s prescribed scheme protects people of pension age from any reduction. Other changes that will be applied to the scheme will be general uprating of annual allowances and benefits as notified by the DCLG.

The following forms the main elements of the proposed 2017/18 scheme.

A reduction in the maximum eligible Council Tax Reduction for Working age (classes D &E) from 90% to 88%.

A reduction in the maximum eligible Council Tax Reduction for the working age vulnerable(class G) from 100% to 95%.

Restrict entitlement to Council Tax Reduction to the equivalent of a Band C. This will becombined with the above maximum limit in all working age claims in classes D, E and G.

The Government prescribed scheme for Pensioners remains with a maximum eligibleCouncil Tax Reduction of 100%.

Income disregards, including those 100% disregards applied to vulnerable groups andfamilies are to remain within the scheme for 2017/18.

3.18 Revised costs of the proposed 2017/18 scheme;

3.19

Appendix A is a summary the responses to consultation on the above options which is also published on the Council’s website.

3.20 A full copy of the proposed Council Tax Reduction Scheme (Bassetlaw) 2017/18 has been made available in the Members’ Room, also to the Leader, Deputy Leader and the Cabinet Member for Corporate & Customer Services.

Claim Group Caseload estimate

2017-18 Estimated expenditure £m 2017/18 (current scheme)

Pension-age (prescribed scheme) 4265 £3.86m

Vulnerable group (local scheme) 663 £0.59m

Working-age employed (local scheme)

825 £0.49m

Working-age other- Unemployed (local scheme)

2942 £2.52m

SUB-TOTALS 8695 £7.46m

Additional sum CTR Discretionary hardship awards 30,000

Total estimated expenditure budget requirement 2017/18 with no scheme changes

£7.49m

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Neighbouring Authorities benchmark

3.21 In order to understand Bassetlaw’s positioning with regard to its neighbours in Nottinghamshire, each LA was surveyed and the table below shows the proposed schemes for 2017/18, the variations in schemes and the collection achievements for 2015-16 (although other factors other than the CTR scheme can affect collection).

Maximum CTR for 2017/18

Other scheme main variations

Variation for protected groups

(class G) Collection %

achieved 2015/16 Ashfield 100% No hardship

fund/default scheme None 97%

Bassetlaw 88% / 95% Hardship fund £30K/ restriction band C

95% 96.9%

Broxtowe 100% Hardship fund/default scheme

None 98.4%

Gedling 100% £25K hardship fund/ £6K capital limit

None 98.7%

Mansfield 90% £20K hardship fund None 97% Newark & Sherwood

80% Restricted to band A / non-dependant charges

increased 20%

None 97.4%

Nottingham City 80% Kept backdates 6m/ no hardship fund

None 92.5%

Rushcliffe 91.5% / 100% Kept 2nd adult rebate and backdating 3

months

100% 99.1%

4. Implications

a) For service users

This report proposes option 3 for the CTR scheme for 2017-18 which would have an impacton service users who claim Council Tax Reduction as follows:

Working-age recipients (who are not in the vulnerable class) would contribute aminimum of 12% of the Council Tax charge. In a typical band A property the estimated17/18 charge would therefore be £2.67 per week (an additional 0.44p per week) onaverage (subject to any further Council Tax increase agreed).

Claimants who are severely disabled and therefore in the Vulnerable class wouldcontribute 5% of the Council Tax charge. In a typical band A property this wouldequate to approximately £1.11 per week.

All working age recipients would have their maximum liability used to calculate CTRrestricted to that of a band C property. The estimated 17/18 council tax liability(excluding parish charge) for a band C property is £29.63 per week. In this example,any difference between the actual charge and the level of CTR calculated at band Cwould be payable by the resident. This would affect approximately 125 out of 8700recipients of CTR.

Claimants of pensionable age will continue to be unaffected by changes to the CouncilTax Reduction Scheme unless set out in changes to the scheme prescribed bylegislation.

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b) Strategic & Policy

There will be implications on the budget strategy moving forward, as central government

grant is removed and changes to the CTR scheme are made. There will also be an impact on the County, Police and Fire Authorities of the funding cuts that affect the Council Tax Reduction Scheme, but this will be partly offset by the net effect on the tax base calculation.

c) Financial - Ref: 17/656 The estimated expenditure on maintaining the existing scheme in 2017-18 is £7.77m

compared to £7.52m currently, as provided in the table in paragraph 3.13. An additional £105K is included in the 2017/18 estimate to reflect the cost of the claims that will move from the working age scheme to the protected pension age prescribed scheme during 2017/18. Also included is an estimated Council Tax increase of 1.95% on each case adding a further £147K potentially to the cost of the current scheme, making a total of £251K additional cost to maintain the scheme as it is.

The proposed CTR scheme is estimated to cost £7.46m in 2017/18 plus the £30K hardship

fund bringing the total estimated costs to £7.49m (see table at para. 3.18). The reduction in grant income between 2017 and 2020 means there will be a shortfall in

funding for the Bassetlaw scheme estimated at £450K. This can be partially met in 2017-18 by amending the scheme as set out in paragraph 3.17 above. This would reduce the cost of the scheme in 2017-18 by an estimated £312K compared to the current scheme. Offsetting this to the additional cost (£250K) would result in a net saving of £60K in 2017/18.

d) Legal – Ref: 695/01/17

The Council Tax Reduction (Bassetlaw District Council) Scheme 2017/18 will take effect from 1st April 2017. The Secretary of State has the powers to prescribe by regulations, additional requirements which must or must not be included in a scheme. These are contained within The Council Tax Reduction Schemes (Prescribed Requirements) (England) Regulations 2012 and the Council Tax Reduction Schemes (Prescribed Requirements) (England) (Amendment) Regulations. The DCLG issues these amendments to the prescribed requirements together with the annual uprating of Allowances and Premiums in December each year.

e) Human Resources None arising from this report. f) Community Safety, Equalities, Environmental The Equality Impact assessment has been reviewed with no new issues identified. g) This is Key Decision No. 587.

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5. Options, Risks and Reasons for Recommendations 5.1 There is no option to change the scheme relating to pensioners as this is a prescribed scheme

which protects this group from changes within the Council’s local scheme. Therefore, the funding associated with this group (£3.86m out of £7.8m) must be maintained. It is estimated that the number of working age claims that would move to the pensioner scheme by 2019/2020 would be 419 so the cost of this protected scheme is likely to increase further by 2020.

5.2 The following options have been considered and analysis done on the impact on both the

council tax payer and on the collection fund to ensure that a balance is achieved. There is a risk that any savings made from reducing the entitlement within the scheme, is offset by additional administration costs of collection.

5.3 Options considered: 5.3.1 Option 1- reduction in maximum CTR This option would reduce the maximum Council Tax liability used to calculate CTR from 90%

to 88% for those claimants of working age (class D and E only). This would reduce the cost of CTR by £266K but offsetting the additional £251K cost due to new pensioners and a Council Tax increase, would be a net saving of £15K. This option also has the most impact on the working age unemployed group and those on low earnings. It would have no effect on other groups. In the consultation responses, in which we asked whether to reduce to 88%, 85% or 80%, 44% agreed with the option to reduce to 88% maximum.

5.3.2 Option 2 – in addition to option 1, restrict entitlement to the equivalent of a lower band Currently CTR is available to residents regardless of the Council Tax band their property is in.

This option restricts the liability used to calculate CTR (after discounts) to the liability of a lower band for example when added to option 1 it would reduce the spend of CTR by £280K, but offsetting the additional £250K cost due to new pensioners and a Council Tax increase, would be a net saving of £30K. The estimated breakdown of the number of claimants by band, for 2017/18 is:

Band A 7194 Band B 773 Band C 415 Band D 219 Band E 75 Band F 21 Band G 7 Therefore 322 households are in properties of band D to G, but 197 of these are pensioners,

leaving only 125 affected by this change. 63% of responses to the consultation agreed that there should be a restriction of CTR according to property band and band C was the preferred level. An estimated band C liability would be £1545 per annum and a band D would be £1738 per annum. In this example, the additional difference of £193 per annum would be added to their bill. Pensioners in higher banded properties would not be affected, but the band restriction would apply to all working age groups.

5.3.3 Option 3 – In addition to option 1 and 2, introduce a maximum CTR for the vulnerable

group The vulnerable group is increasing in number and therefore it is difficult to sustain the current

100% maximum CTR within the scheme. The Council has recognised that this group has additional needs that can impact on their finances, but consultation responses agreed that

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they should make a small contribution to their council tax to make the scheme fairer to all groups and that this should be phased in. The current scheme also includes a 100% disregard of some disability benefits such as Disability Living Allowance (DLA) which at the higher rates ignores up to £140 of their weekly income. The scheme has also maintained the higher income allowances and premiums from the old benefit scheme, within the calculation. The consultation suggested implementing a 95%,90% or 88% maximum CTR and 95% was supported for 2017/18. When added to option 1 and 2 as a combination, this would reduce the cost of CTR by £312K, but offsetting the additional £250K cost due to new pensioners and a Council Tax increase, would be a net saving of £60K.

5.3.4 Option 4 – Remain at current 90% maximum but introduce a band restriction and

vulnerable contribution For comparison, estimates have been calculated with the maximum CTR maintained at 90%

but introduce the band restriction (to Band C) and the 95% maximum for the vulnerable class. This option would reduce cost of CTR by £234K but offsetting the additional cost of new pensioners and the Council Tax increase, would increase the costs by £17K in 2017/18 therefore not meeting any savings target.

5.3.5 Option 5 – Remain at current 90% maximum with band C restriction only (no vulnerable

contribution) This option would, in effect, apply the band restriction only to the scheme. The vulnerable

group would remain on 100% CTR and would therefore it would affect only 107 working age claimants, who are in a band D to G property. This option would reduce costs of CTR by £204K but offsetting the additional cost of new pensioners and the Council Tax increase, would increase the costs by £48K, which is not sustainable.

5.4 The full list of options considered can be found in the consultation document included with this

report (Appendix A). The proposal in this report does not include any changes to income disregards in 2017/18 as this was not supported in the consultation.

5.5 The Council operates a Council Tax Discretionary Fund (currently £30K), which gives help to

people who are experiencing exceptional circumstances or where there is a successful appeal. The fund is agreed through an officer delegated decision each year, therefore there is the option of increasing the fund to cushion the impact for anyone suffering exceptional circumstances due to a change in the scheme.

6. Conclusions 6.1 It is anticipated that the funding available in the collection fund for 2017-18 will not be sufficient

to meet the costs of the current 2016-17 scheme but a saving of £450K between 2017 and 2020 would need to be planned in to prepare for further reductions in the grant. It is proposed to reduce the spend on the CTR scheme phased in over the next three years until future funding mechanisms are clearer or there is a change in Government policy.

6.2 It is proposed to change the scheme according to option 3 above. The proposed changes to

the scheme for 2017/18 and the estimated cost are set out in paragraphs 3.17 and 3.18 of this report

7. Recommendations 7.1 That Members approve the Council Tax Reduction Scheme (Bassetlaw) 2017/18 with the

changes as set out in paragraph 3.17 to take effect from 1st April 2017

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Background Papers Location Council Tax Reduction Schemes modelling 2017-18 SRBM Council Tax Reduction Scheme (Bassetlaw District Council) 2017/18 Members’ Room Council Tax Reduction Scheme (Schedules 1-10) Members‘ Room Consultation response summary - Appendix A to report

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Appendix A

Analysis of the Consultation on the Local Council Tax Reduction Scheme Options 2017-18

Bassetlaw District Council opened this consultation on 26th September 2016 to seek the views of residents on the options available to the Council for the Local Council Tax Reduction Scheme 2017/18 and the potential impact. It was open for two months until 28th November 2016.

This document provides the analysis of the information gathered during that period.

The number of respondents was 319 in total. The breakdown shows that there were responses from across the district

Postcode Area No. Responses

%

DN10 Misterton 28 8.8% DN11 Harworth and Bircotes 15 4.7% DN22 Retford 87 27.27% NG20 Cuckney 4 1.25% NG22 Tuxford 26 8.15% NG23 Normanton – on Trent 1 0.3% S80 Worksop 39 12.23%

S81 Worksop , Langold, and Carlton-in-

Lindrick 66 20.68%

No Postcode given 53 16.61% Total 319

Q1 Given the year on year reduction in Government funding, do you agree that the Council should give all working age residents who qualify for help, a maximum discount off their Council Tax bill?

• Agree 66.01% • Disagree 33.99%

Q2. The current maximum discount is based on 90% of the Council Tax liability for the year. The following questions are in respect of the working-age residents who are not classed as severely disabled. Agree Disagree To reduce the maximum Council Tax Reduction to 88% which means a minimum contribution of 12% to the Council Tax bill

43.95% 56.05%

109 139

To reduce the maximum CTR to 85% which means a minimum contribution of 15% to the Council Tax bill

33.20% 66.80%

80 161

To reduce the maximum CTR to 80% which means a minimum contribution of 20% to the Council Tax bill.

35.54% 64.46%

86 156

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Q3. To ensure that the scheme is as fair as possible, the following questions relate to the Vulnerable group which is currently those who qualify for a severe disability premium in the calculation of their benefits or Housing Benefit. Do you agree with the definition of the vulnerable group and that the Council should have a separate class for this group within its scheme?

• Agree 84% • Disagree 16%

Q4. Do you agree that the 'Vulnerable' group should start to make some small contribution to their Council Tax?


Q5. The current maximum CTR for the Vulnerable group is based on 100% of the Council Tax liability. Which of the following options do you agree or disagree with, if it was agreed that this group should make a small contribution (allowing a phasing in period).

Council tax liability to 95% which means a minimum contribution of 5% to the Council Tax bill

56.45% 43.55% 140 108


29.14% 71.86% 65 166


23.18% 76.82% 54 179

Q6. Currently CTR is available to residents in Bassetlaw regardless of the Council Tax band that their property is in. Do you agree that there should be a Council Tax band restriction within the Council’s CTR scheme, which would limit the amount received if the claimant lives in a large, higher banded property?


Q7. If you agree to question 6 please tick which Band you think the maximum CTR should be limited to. (This would not exclude people in a higher band applying, it would just limit the amount they could receive in discount off their bill

Council Tax Banding % No. Responses

Band A 16.67% 30 Band B 17.78% 32 Band C 40.00% 72 Band D 12.22% 22 Band E 13.33% 24

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Q8. The Scheme currently disregards 100% of Child Benefit income to mirror the Housing Benefits rules. Do you agree that 100% of this should be disregarded in the CTR calculation?


Q9. If you disagree, what % do you think the disregarded amount should be?

% disregarded amount OF Child Benefit

% of responses No. of responses

0 15.38% 20 1-10 8.46% 11 11-20 7.69% 10 21-30 6.15% 8 31-40 0.77% 1 41-50 24.61% 32 51-60 2.30% 3 61-70 0.77% 1 71-80 10.00% 13 81-90 8.46% 11 91-100 15.38% 20 Total number of responses 130

Q10. The scheme currently disregards 100% of child maintenance to mirror the Housing Benefit rules. Do you agree that 100% of this should be disregarded in the CTR calculation?


Q11. If you disagree, what % do you think the disregarded amount should be?

% disregarded amount of Child Benefit

% of responses No. of responses

0 12.59% 17 1-10 10.37% 14 11-20 8.14% 11 21-30 6.67% 9 31-40 0.74% 1 41-50 20.00% 27 51-60 2.96% 4 61-70 1.48% 2 71-80 15.55% 21 81-90 8.89% 12 91-100 12.59% 17 Total number of responses

135

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Q12. The current scheme disallows a claim from anyone who has savings or capital that totals more that £16,000. This is in line with Housing benefit limits and Universal Credit limits. Do you agree that the capital limit should remain at £16,000?


Q13. If you disagree, what capital limit do you think should apply?

Capital Limit % of responses No. of responses Zero 1.08% 1 £2,500 1.08% 1 £3,000 1.08% 1 £3,500 1.08% 1 £2,000 1.08% 1 £5,000 17.39% 16 £6,000 1.08% 1 £8,000 3.26% 3 £10,000 21.74% 20 £11,000 1.08% 1 £12,000 5.43% 5 £13,000 1.08% 1 £17,000 1.08% 1 £20,000 23.91% 22 £21,000 1.08% 1 £25,000 11.96% 11 £26,000 1.08% 1 £30,000 2.17% 2 £100,000 1.08% 1 £250,000 1.08% 1 Total number of responses

92 (+ 2 comments)

Comments • an increase • If this is from sale if property etc. should be disregarded otherwise limit is ok

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Q14. The Council is considering an income banded scheme in the future which would be a simple flat rate percentage discount awarded depending on what income band your total weekly income falls into. This will mean that a small change in circumstances may not need a re-assessment of your council tax bill, if that change falls within the same income band. Do you agree that the Council should consider implementing an income banded scheme?

• Agree 78.29% • Disagree 21.71% •

Q15. There is an expectation by the Government’s Welfare Reforms that parents of children over school age should find work. Do you agree or disagree that the Council should have some transitional protection from any further changes to the CTR scheme, for vulnerable families e.g., lone parents, with a child under 5 years


Q16. Additional Comments

As a Parish Council, Lound could not agree on many points, so feel unable to reply as a body but hopefully will respond individually.

I realise it is hard to juggle all the finances and benefits. All i ask is that you keep in mind families who may not always appear to be struggling, but who actually are. It is always the people in the 'grey areas' of these things, that end up falling through the gaps and becoming even worse off

I strongly believe that a re-evaluation of all bands is completed immediately as my band for a 3 bed bungalow is the same as 4/5 bedroom farmhouse

There should be a phased approach for people on benefits. Could not answer which Council tax band as don't know what the bandings mean.

The Council should only give help to those who have a lifelong illness, who can't find or look for work like those without a disability. people with disabilities rely on this benefit and most are struggling already with benefit cuts. I have been grateful for my council Tax benefit and if there were any changes this would mean I would be going without my basic needs. I live within my means but if anymore benefit was cut that would put me under par as I struggle long term as it is. I think the system works well as it is for people with disabilities who due to health problems cannot seek paid work like others. This also works for people who are vulnerable in society due to health conditions. As regards to the government sending people out to work, if the breadwinner of the household can provide sufficiently for his/her family then this shouldn't be forced. My Dad was the breadwinner of the household and my mother remained the housewife and my father was happy with this. I agree that children of working age who are fit and able should pay towards Council Tax and pay in full when wages are sufficient to do so.

I think income banding is a good idea as would reduce council workload re-assessing on small changes of circs, as well as reducing potential overpayments of CTR which then increases CT instalments due & extra recovery process that might possibly be needed to collect that.

Although the recipient may be working age- there could be underlying reasons i.e. health or caring for a member of their family. Each Individual has to be dealt with in a compassionate way - particularly depending on their needs and circumstances.

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I appreciate BDC has restrictions from the government.

I think the people who are most vulnerable should receive the highest reduction. Like the disabled, who for no fault of their own cannot work. And the pensioners who are not well off should also receive the full reduction. If they cannot afford to pay now, how do you expect them to pay anymore. People who have dementia and other mental health problems, do not need the extra stress and worry about how they are going to pay.

i am vehemently opposed to any changes that would include means testing and cutting benefits already awarded to people. Council tax is already excessive and grossly unfair. The amounts have spiralled over the years and really provide hardship to people. As this is a bill that citizens just cannot default on the council seems to take advantage of this. It seems that the only answer that comes to mind for your poor budgeting is to try to squeeze more money out of people. Money they do not have. Furthermore, this questionnaire is written in a complicated and confusing way in order to dissuade people from filling it in. When so many people are illiterate or have problems it is your duty to make these forms as simple as possible. I am an intelligent person and still struggled with what you were asking? I feel this is deliberate in order to achieve a poor response. Badly done Bassetlaw.

I believe income is the key guide to setting a fair CTR - this applies to all groups, including disabled.

Incentive rewards with penalties might be introduced to encourage job seeking

People on Guarantee pension Credit and not working should not pay Council Tax

the scheme should not push people into poverty and every effort should be made to protect families with young children.

I am a single parent, my son is 10 and I home tutor him, his Mother has not seen him since he was 1 year old by her own choice, I do not receive maintenance and at the moment am without any opportunity at all to either change our circumstances or look for work, the circumstances I am in are pretty extreme, consideration should be made especially for people like me who are ''stuck between a rock and a hard post’ ‘the details you have on file regarding my savings are old and no longer applicable as my savings have gone, however I continue to pay a contribution to Council Tax monthly by direct debit as I feel it correct t do so . Thank You P.Scopelliti

I believe that as a country we have lost sight of the need to protect the vulnerable and that those who are better off should be willing to provide the means of doing this via taxation. This includes, of course the big businesses who would rather pay other big businesses to help them dodge taxes than pay the taxes! That said in the real world we are not going to change how the present government and establishment run things and I have to accept that cut backs must be made and my answers above reflect this.

Council Tax is a massive strain on people's money-management and should not cause hardship. CTR could be continued by diverting funding which is now not needed for some schools in the area - i.e. those which are PFI schools therefore no longer under council control. Service are also being cut back so Council Tax is not needed for so many things anymore.

Consideration should be made regarding the type of property lived in. People living in their own property have to maintain it (regardless of income) whilst people living in rented accommodation do not have this burden

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Related to item 13. If income is mega bucks then perhaps yes, if we're talking measly income (£20,000 or less) then absolutely no way. I'm generally extremely peeved that we are continuously lied to about lack of funds for councils and essential services considering that the UK government has an unlimited supply of funds to murder innocent people in middle eastern countries whilst making a profit, all at the same time we see an ever increasing divide between the rich and the poor. When will we all wake up and realise we are being fed a bunch of lies and stand up and do something about it??? we really are having the piss taken out of us as a nation, enough is enough.

work is not always available, also work that fits in with school is not easy to get.

Why are vulnerable people now being made to pay for the govt not regulating the banking industry

I live in a band d area and have tried to get a council house in a lower band but have absolutely no chance, i cannot afford to another private rent in a lower band due to the costs

Any cuts will be difficult for everyone but especially the vulnerable. Therefore, any cuts to CTR must be done gradually. Everyone is on a tight budget these days and an increase in outgoings for many people, especially the vulnerable, will be a hardship.

The Policing precept should be more weighted to the urban areas that get the majority benefit. Villages rarely if ever see action unless it is emergency. They should not pay for anti-social behaviour , drug abuse etc. that is prevalent in Urban areas.

The principles being proposed are fine, but as I have no idea of the numbers of beneficiaries involved it is difficult to be specific.

I’m struggling with making the current amount of £11 a month so an increase would make a huge impact on my quality of living

I think, as with some utility bills, there should be a standing charge.

However difficult the council is finding things please consider that council tax has risen year on year for a many years whereas my salary has been held at the same level for at least five years now.

I think you need to concentrate on the people that could work but don’t because they get more benefits and more money than people that actually do work. If you are part of a low income family or can’t work because of a disability, then that should be looked into but it should be on a case by case basis. Some people are getting benefits or claiming benefits when they could easily go to work. Even people in high income families with big houses get benefits this should be stopped.

Lone parents can get free childcare for children from age 3yrs.

With benefits being cut & also frozen it could leave people in either food of heating poverty

Should person centre the way people pay as much as possible for moral fairness and kindness and decency.

not sure how the tax banding works so I went middle of the road also i think all income from any source should be considered some single parents have more income coming in than some couples who have hit hard times basing it on income is fairer in my opinion

Being a parent has nothing to do with their income, so it should would not have a direct link with their ability to pat their council tax. IMO

Stand up to this government - object to the reduced funding in the strongest possible way

People who have higher incomes over 45K should pay much more council tax, the poorest & most Vulnerable should pay nothing or a nominal amount, that is realistically means tested.

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I think everyone should make a contribution to council tax ,as all benefit from the services

For a lot of single parents they are trying to make ends meet, without having any wage increase.

People who Work should get a discount off there council tax bill, as I’m sure this would encourage some on benefit to find work if they had to pay a large amount on their council tax bill.

Being a single mum of 11-year-old and 3-year-old I find it hard to find a job that fits around my children and cannot always leave with family or friends. I strongly agree we should have the choose when we to go back to work and not be pushed in to it.

CTR liability to 80% in line with working age claimants as persons in the vulnerable group have a higher income than those on JSA/Income Support etc. Remove the vulnerable group all together. Having different percentages for different groups is discrimination, which opens the council up to a costly legal battle. If maintenance for children is to be taken into account as income for CTR purposes, not all single parents claim maintenance. This is then unfair and discriminates against those parents who do claim maintenance. Would therefore recommend that an assumed income be added for each child where the parent does not claim maintenance.

System should not penalise people who have saved.

Income from all residents in the property should be taken in to account before any reductions made

Think people who don't pay on time should be fined, we that pay on time should not subsidise others they get the same benefits

1. Endorse protection for people receiving severe disability premium. 2. Disagree with income banding scheme because implementation will be difficult. 3.Urgent need to review the council tax bandings/housing values.

You bring back if have not find job 3 years they got sign up to army or navy or air force push youngsters to find work.

Being a person who has previously had a fantastic career on a very high salary and looked down upon those who claimed benefits, I have found myself in a position of similar experience due to leaving my career to be a full time mother and housewife and the breakdown of my marriage, I was left with nothing and in a position where I had to swallow my pride and claim any available benefits, which I did with my 3 children in mind. If it wasn't for such benefits I would not have been able to get back on my feet and build a new life. Having said that I have chosen the option of a minimum of 15% contribution of council tax, as I believe it helps people to return back into the 'bill paying' society once their funds are available.

As a pensioner living in my own house I find this a very distressing survey to complete.

If someone up in a larger house they are already paying more anyway. I do think everyone should pay something, with the exception of disabled and terminally ill.

By making a minimum payment for everyone would just mean higher recovery costs for the council as people who should pay will not pay. This was proven with Community Charge & councils across the country are still writing off charges that were unable to be collected. By taking into account incomes that were previously disregarded but basing it on 100% liability it would give a truer fairer reflection on who can pay. Lone parents are not a vulnerable group; neither are people with children under the age of 5. There are many lone parents & couples with children under 5 who work & pay the full CTAX charge.

Everyone should make a contribution no matter how small

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People on benefits should not pay any Council Tax. Whoever introduced this in Central Government was probably a Tory who was sat in his mansion counting his money.

single people without children working part time and earning under £7,000 should be included in the 100% discount because as it stands at the moment there is little or no help for people working part time and these people more often or not have less coming in than people on benefits and cannot claim extras like tax credits because they are penalised for working under 30 hours

The scheme for council tax reduction is good but as you have proposed there should be percentage contributions from all participants as in some cases residents working full time but on a low income are penalised whereas others claiming multiple other benefits actually have more available money but can claim reduction. Conversely if a resident is in a higher banded property this does not necessarily mean that they have a correspondingly higher living income, this would probably include a fair proportion of more elderly residents who have perhaps lost their partner and as a result a work pension but they may still be in their original family home. These residents should also receive some help

There is no mention of people of pension age in this survey, some of which are far more affluent than young working age families. Surely limits to be applied to these persons as well.

Whilst I agree that certain people in our society (disabled for example) there is no question a large proportion of Bassetlaw people want something for nothing and are happy to do, say etc. anything to get it. Council efforts should be made in stopping those payments and - when people are discovered to have transgressed - they should be prosecuted. Why should I have paid a considerable amount in taxes during my working life, just to give it back to people who will not work and some who have probably only been in this country for two minutes! I am a pensioner and am still paying tax to support these people!!!!

I could agree with item 14 depending on the band width

Some unmarried/single parents??? manage to live in expensive 4 bedroom houses on the back of child benefit, if they want more handouts they have more kids. (even if they struggle with the ones they have) The hard working married parents, cannot afford 'extra ‘children, they live within their means, and some Benefits Families might be are living in posh houses which some hard working people could not afford, as the Council benefits culture is so good !.But it’s not so good for the hard working population who are having to pay for this over generous culture we are in.

Any one receiving CTR and has alterations done to their property should be reassessed and look at how they have funded the alterations.

I feel the present scheme is fair. I wouldn't like to see disabled people targeted. There may be a majority who will vote in favour of a change but that is because people often don't know the reality of the struggle to exist on benefits.

I feel that regardless of the position you are in you should be making a contribution to Council Tax. Myself and my wife hold down four jobs between us to ensure that the rent and council tax are paid, yet there are people who live next to me who purposely don't look for work, claim they are disabled when they are not and they pay nothing or make a very limited contribution. Why should I be the one paying the amount I am, on time, every time when others clearly play the system to get out of it.

CTR should only be given to people of good character. People with ASBO's, CCJ's, criminal offences etc. should not receive tax payer funds to finance their behaviour. People who have not contributed to the UK tax system should not receive tax payer assistance.

Pensioners .single occupancy should equate to 50% reduction as they do not use the facilities that family's use

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invest in more council housing

It's all been a con since its inception. The people that claim this benefit are the ones with the lowest income in the country & shouldn't be penalised for other people's mistakes/excesses of previous years/regimes.

Apply the same means-test to OAPs and other claimants in all cases

Do like robin hood did hit the rich not the poor

For people who only live on ESA should not pay council tax or 2%

Senior Citizens should be means tested using the same allowances and disregards as everyone else

perhaps your time and effort could be better spent catching the many who throw away their crutches and mend your roof or dig your garden or even deliver your pizza in the mobility car let alone claim to be separated and have two free council properties.... yes, it's hard being on benefits for a lot of genuine people!! but you should be tasked to eliminate the scroungers in our midst.

Had trouble with the wording of Q7. I think that single people who live in the highest band should not get a discount on their council tax.

THE SCHEME BASED ON THE TOTAL WEEKLY INCOME WOULD BE THE FAIREST AND EASIEST TO APPLY.

I receive on average about 3 sheets of printed paper with each council tax bill I get. At the same time, I receive on average about 3 to 4 letters per year. Maybe there could be some money saved by only sending out 1 standard A4 letter to the billing address. I am aware that the other sheets of paper are a breakdown of how your Council tax bill is worked out. But I say this with complete confidence that you need a mathematics degree in order to work this out, therefore 99% of householders will just rip it up and bin it. This could also save money on recycling. Another plus for Bassetlaw funding. Thank you

Stop giving young single parents free homes and rent. Help the old and invalids, not the idle.

Elderly people in larger homes may not always find it easy to move. the existing cuts to the disabled and other vulnerable groups mean that help needs to generally be at the highest affordable level.

savings could be done elsewhere i.e. flower boxers on side of roundabouts and bridges done away with.

They should get a job and pay their way. Why should I subsidise scroungers? Been self-employed 31 years, there's work out there if you want it.

Everyone should be treat the same regardless of age! Pensioners get plenty of money to be able to pay 10% of their council tax bills, and most of them have good savings too. Reduce the amount of savings to 10,000 for everyone and make pensioners pay 10% of their bill as everyone on low income has to do.

The flat rate band scheme seems better especially if a new bill does not have to come out every time your income changes by a small amount. That must save money on print and postage as well for the Council.

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Agenda Item No. 4(a) BASSETLAW DISTRICT COUNCIL

CABINET 10th JANUARY 2017

REPORT OF THE DIRECTOR OF COROPORATE RESOURCES

CALCULATION OF COUNCIL TAX BASE 2017/18

Cabinet Member: Finance Contact: D Hill Ext. 3174

1. Public Interest test 1.1 The author of the report, David Hill, has determined that the report is not confidential.

2. Purpose of the Report 2.1 To set out and approve the calculation of the Council’s 2017/18 tax base as required

by The Local Government Finance Act 1992 in accordance with The Local Authorities (Calculation of Council Tax Base) (England) Regulations 2012.

3. Background and Discussion

3.1 The Local Authorities (Calculation of Council Tax Base) Regulations 2012 (the council tax base regulations), specify the formulae for calculating the council tax base, which must be set each year between 1st December and 31st January.

3.2 The ‘billing authority’ must calculate the tax base based on information contained in

its Council Tax valuation list on the 30th November in the year immediately preceding. 3.3 The tax base calculations for Bassetlaw are also used by Nottinghamshire County

Council as well as the Nottinghamshire Police and Crime Commissioner and Combined Fire Authority to determine their respective levies for 2016/17. Additionally, the figures are used by the 56 local parish and town councils throughout Bassetlaw.

3.4 The council tax base is a measure of the number of dwellings on which council tax is

chargeable in an area or part of an area. It is used for the purposes of calculating an authority’s band D council tax. The tax base calculation has changed to take into account the introduction of the local council tax support scheme which commenced in 2013/14.

3.5 Under the new local council tax reduction scheme, the council tax base is affected by

whether persons living in a dwelling within an authority area are in receipt of a council tax reduction awarded under the scheme, as the billing authority foregoes council tax income from those dwellings. These local council tax reductions are reflected in the calculation of the council tax base, in order to calculate the correct amount of band D council tax for the billing and precepting authorities in the area.

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3.6 For Council Tax purposes, properties are placed in different property ‘bands’ based

broadly on the value of the property, using April 1991 as the baseline valuation date. The band is used to determine the Council Tax levied for that property.

3.7 The Council’s basic tax figure is calculated in respect of band D. Other bands are

then calculated as a fraction of the tax at band D. The fractions applicable to the various Council Tax bands are as follows:

Band A B C D E F G H Fraction 6/9ths 7/9ths 8/9ths 9/9ths 11/9ths 13/9ths 15/9ths 18/9ths

3.8 The tax base calculation is determined by identifying the number of properties liable

to be levied and the banding in which the properties are placed and then applying relevant exemptions, discounts, including the local council tax reduction scheme, and banding reductions. The information is compiled for each parish and the authority’s tax base is built up from these bands. The resultant figures are then adjusted to the number of band D equivalents by applying the proportions shown above.

3.9 As can be seen in Appendix 1, the total number of dwellings in Bassetlaw is 51,368 (line 1). Once adjusted for discounts, exemptions, premiums and band reductions this figure reduces to 47,048.0 (line 14). The total is then converted into the number of band D equivalents, 38,660.58 (line 16). The figure is finally adjusted for the local Council Tax reduction scheme (line 18) to produce the tax base figure of 34,407.48 properties (line 19).

3.10 The final band D equivalent figure is then further adjusted to allow for a provision of growth of housing stock, any anticipated losses on collection, and any other relevant foreseen adjustments. A final tax base figure is then obtained, shown on Appendix 1 as 33,916.77 band D properties.

3.11 Regulations under the Localism Act enacted as an amendment to LGFA 1992 state

that a Council should calculate a tax base. The tax base recommended on the attached appendices is 33,916.77 properties, net of reduction, discounts and growth. This tax base shows an increase in band D equivalents of 837 properties compared to the tax base set for 2016/17. This in turn will result in additional income for all preceptors.

4. Implications

a) For Service Users The tax base forms the basis of the Council Tax levels for 2017/18 for Bassetlaw’s Council Tax payers. The amount required to be met from Council Tax for 2017/18 (to be approved by Council on 7th March 2017) will be divided by the tax base set to determine the Bassetlaw District Council charge.


The income received from Council Tax is key to financing the provision of Council services.

c) Financial – Ref. 17/997

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The tax base forms the basis of the Council’s Council Tax setting resolution for 2017/18 which is due to be considered by full Council on 7th March 2017. The adjusted Bassetlaw tax base must be notified to Nottinghamshire County Council and to respective Police and Fire Authorities before 31st January 2017. The Parish tax base figures are notified individually to the Parish Councils in order that they may determine their level of precept on Bassetlaw District Council. The tax base calculation performed as at 30th November 2016 is subject to a collection rate factor which has been set at 98%.

d) Legal – Ref. 694/01/17

The relevant regulations place a legal requirement on a billing authority to set a tax base.

e) Human Resources None from this report. f) Community Safety, Equalities, Environmental None from this report. g) Whether this is a key decision, and if so the reference number.

This is Key Decision No. 602. 5. Options, Risks and Reasons for Recommendations 5.1 The Council has a statutory obligation to set a tax base and to notify precepting

authorities. To not set a tax base would mean a breach of the statutory requirement and there would be no basis on which to set a Council Tax for 2017/18.

5.2 Setting the Council tax base is the first step in determining the Council Tax for

2017/18. The tax base must be determined and notified to other relevant bodies by 31st January each year.

6. Recommendations 6.1 Cabinet agrees that the Council tax base for the year 2017/18 shall be 33,916.77

band D properties, subject to the Council Tax Reduction Scheme being agreed as proposed.

6.2 That Cabinet recommends to Council the calculations set out in Appendix 1 to agree

the Council tax base calculation for the district for 2017/18 and instructs officers to notify this figure to the major precepting authorities.

6.3 That Cabinet recommends to Council the calculations set out in Appendix 2 figures

which are tax bases for parts of the area and instructs officers to notify the 2017/18 tax base to Town and Parish Councils, Parish Meetings and Charter Trustees as soon as is practicable.

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Bassetlaw District Council - Council Tax Base 2017/18 Appendix 1

1 2 3 4 5 6 7 8 9 10

Dwellings shown on the Valuation List for the authority on 30th November 2016Band A entitled to disabled relief

reductionBand A Band B Band C Band D Band E Band F Band G Band H TOTAL

1 Total number of dwellings on the Valuation List 26,625 7,670 6,215 5,987 3,043 1,458 675 56 51,729

2Number of dwelling on valaution list exempt on 30th November 2016 (class B & D to W exemptions) 367 80 62 45 24 10 8 2 598

3 Number of demolished dwellings on 30th November 2016 0 0 0 0 0 0 0 0 0

4 Number of chargeable dwellings on 30th November 2016 (lines 1-2-3) 26,258 7,590 6,153 5,942 3,019 1,448 667 54 51,131

5Number of chargeable dwellings in line 4 subject to disabled reduction on 30th November 2016 149 56 59 56 30 17 14 11 392

6Number of dwellings effectively subject to council tax for this band by virtue of disabled relief 149 56 59 56 30 17 14 11 392

7Number of chargeable dwellings adjusted in accordance with lines 5 and 6 (lines 4-5+6) 149 26,165 7,593 6,150 5,916 3,006 1,445 664 43 51,131

8Number of dwellings in line 7 entitled to a 25% discount by virtue of occupancy on 30th November 2016 50 10,611 2,302 1,636 1,224 490 222 82 6 16,623

9Number of dwellings in line 7 entitled to a 50% discount by virtue of occupancy on 30th November 2016 0 17 10 5 10 5 13 20 2 82

10Number of dwellings in line 7 entitled to a 25% discount by virtue of being empty less than 6 months on 30th November 2016 446 78 66 44 27 9 9 0 679

11Number of dwellings in line 7 entitled to a 25% discount by virtue of being empty and uninhabitable on 30th November 2016 27 6 3 5 2 3 2 0 48

12Number of dwellings in line 7 assumed to be entitled to no discounts (line 7-8-9-10-11) 99 15,064 5,197 4,440 4,633 2,482 1,198 551 35 33,699

13Number of dwellings in line 7 subject to a 50% surcharge by virtue of being empty more than 2 years on 30th November 2016 110 35 16 16 7 5 7 1 197

14Total equivalent number of dwellings after discounts, exemptions and disabled relief (to 2 decimal places) ((line 8 x 0.75) + (line9 x 0.5) + (line 10 x 0.75) + (line 11 x 0.75) + (line 12) + (line 13 x 1.5))

136.50 23,550.50 7,044.00 5,745.25 5,616.75 2,884.25 1,387.50 641.25 42.00 47,048.00

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5/9 2/3 7/9 8/9 1 1 2/9 1 4/9 1 2/3 215 Ratio to Band D 5/9 6/9 7/9 8/9 1 11/9 13/9 15/9 18/9

16 Number of Band D equivalents (to 2 decimal places) (line 14 x line 15) 75.83 15,700.33 5,478.67 5,106.89 5,616.75 3,525.19 2,004.17 1,068.75 84.00 38,660.58

17 Tax base for Revenue Support Grant purposes 38,660.58

18 Reduction in tax base due to Council Tax Reduction Scheme 4,253.10

19 Tax base before adjustment for growth 34,407.48

Estimate of dwellings due for completion by 31.03.17 not yet on Valuation List 109.78Estimate of new building coming on stream in 2017/18 105.67

Estimate of reduction in empty home income -14.00

Total 34608.93Collection Adjustment (98%) 692.16

Taxbase for Bassetlaw for 2017/18 (2016/17 in brackets) 33,916.77 (33079.77)

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Bassetlaw District Council - Parish Council Tax Base 2017/18 Appendix 2

Parish/Town Area Council Tax Base

Parish/Town Area Council Tax Base

Askham 82.17 Markham Clinton 93.78Babworth 225.81 Mattersey 253.17Barnby Moor 116.73 Misson 270.54Beckingham-cum-Saundby 477.45 Misterton 716.67Blyth 484.92 Nether Langwith 138.60Bole 49.41 Normanton-on-Trent with Marnham 200.61Bothamsall 97.74 North & South Wheatley 264.87Carburton 26.19 North Leverton with Habblesthorpe 346.23Carlton-in-Lindrick 1624.86 Norton Cuckney 135.00Clarborough & Welham 393.39 Rampton 278.55Clayworth 143.19 Ranskill 496.17Clumber & Harwick 32.67 Rhodesia 223.92Dunham-on-Trent with Ragnall, Fledborough & Darlton

219.78 Scaftworth 17.73

East Drayton 117.99 Scrooby 131.85East Markham 482.85 Shireoaks 448.02East Retford Charter Trustees 6744.24 South Leverton 195.84Elkesley 234.81 Sturton-le-Steeple 194.49Everton 358.11 Styrrup with Oldcotes 244.08

Gamston with West Drayton & Eaton 235.89 Sutton 263.61

Gringley-on-the-Hill 345.87 Torworth 85.05Harworth & Bircotes 1932.66 Treswell with Cottam 121.50Haughton 20.16 Tuxford 785.25Hayton 158.49 Walkeringham 353.88

Headon-cum-Upton with Grove & Stokeham 156.96 Wallingwells 14.31

Hodsock 598.32 West Burton 6.75Holbeck & Welbeck 123.57 West Stockwith 112.68Laneham 145.71 Wiseton 45.27Lound 195.84 Worksop Charter Trustees 11652.57

TOTAL 33916.77

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Agenda Item No. 4(b) BASSETLAW DISTRICT COUNCIL



BUSINESS RATE BUDGET 2017/18 Cabinet Member: Finance Contact: Dave Hill Ext: 3174 1. Public Interest Test 1.1 The author of this report, Dave Hill, has determined that the report is not confidential. 2. Purpose of the Report 2.1 To set the Council’s estimated net yield from local business rates for 2017/18, which

will be used to calculate Bassetlaw’s share for the purpose of budget setting in the February 2017: General Fund Revenue Budget 2017/18 to 2019/20 Cabinet report.

3. Background and Discussion Methodology 3.1 Central government requires all local billing authorities to complete a return (called

the NNDR1 return), which sets out the business rate income baseline for the purposes of budget setting.

3.2 Prior to 2013/14, the NNDR1 return informed government of how much the Council

was due to collect and pay over to the Department for Communities and Local Government (DCLG), and this was then amalgamated with all other billing authority NNDR1 return submissions to determine the size of the national business rate pot. This was then redistributed back to individual Councils using population statistics.

3.3 The Business Rates Retention Scheme came into operation on 1st April 2013, and

although the arrangements are very similar to before, the importance of this return has changed significantly. With the projected withdrawal of Revenue Support Grant by 2019/20, business rate income is likely to become the most significant source of income for the Council.

3.4 There is a direct link between the NNDR1 return and the amount of business rates

retained by the Council. The total is currently allocated on the basis of:

• 50% to be paid to the Central Government; • 40% allocated to the District Council; • 9% to be paid to the County Council;

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• 1% to be paid to the Fire & Rescue Authority. 3.5 From this figure, further calculations are applied for tariffs or top-up’s, and safety net

payments or levies, before arriving at an individual business rate budget for a local authority for 2017/18.

3.6 Bassetlaw currently pays a tariff i.e. the 40% retained business rate income allocated

to Bassetlaw District Council is much higher than central government deems to be required, and therefore a tariff is payable back to central government for distribution to other councils where the amount collected is less than the baseline amount required. This is called a top-up payment.

3.7 The position as regards to whether a safety net is receivable or a levy is payable is

less clear, as it depends upon how much income is collected in year when compared against the government’s baseline position i.e. what central government expected Bassetlaw to collect.

Pooling 3.8 From 1st April 2013, all of the seven Nottinghamshire District Councils joined

Nottinghamshire County Council to form a business rates pool. This arrangement works exactly the same as for an individual authority, except the tariff or top-up, and the safety net payment or levy, is calculated on the Pool as a single entity.

3.9 This approach has enabled a greater level of financial resources to be retained within

Nottinghamshire, as the 50% levy paid by a district council on business rate growth would ordinarily be paid to central government, whereas under the pooling arrangements, this is retained locally and redistributed back to partner authorities. It also affords the same degree of protection against volatility of business rates as would have occurred without the pool i.e. a safety net payment for any reduction in business rates income below 92.5% of the expected baseline figure.

3.10 Another benefit from joining the pool is the assurance against the volatility of

business rates. About 45% of Bassetlaw’s business rate income is receivable from only thirteen hereditaments, and this includes four power stations. All business rates income is subject to appeal or business closure, and therefore a sudden loss in any one of these thirteen hereditaments would have a major impact on the finances of the Council.

3.11 Nottinghamshire Chief Executive’s Group agreed that 50% of the Pool surplus

generated in 2015/16 would be retained by the Combined Authority and 50% would be returned to Pool members in line with the terms set out in the Memorandum of Understanding. From this arrangement Bassetlaw received a £0.04m. Similar arrangements will apply in future years, with the Chief Executives reviewing and agreeing the 50/50 distribution annually.

Calculation 3.13 Part 2 of the Non-Domestic Rating (Rates Retention) Regulations 2013 require all

billing authorities to calculate the following amounts and to notify these to the Secretary of State and any relevant precepting authorities by 31st January each year via the NNDR1 return:

(a) the amount of the central share of its non-domestic rating income;

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(b) the amount of each relevant precepting authority’s share of its non-domestic rating income in accordance with regulation 5; (c) the amount (if any) to be deducted from the central share payment in accordance with regulation 4(1); (d) the amount of each relevant precepting authority’s share of any amount to be deducted from the central share payment in accordance with regulation 4(1); (e) the amount (if any) specified by regulation 7(2).

3.14 The 2017/18 Business Rates revaluation has been announced and the new rating

list published, although the final list has not yet been determined. There has been a decrease in the total Rateable Value for Bassetlaw District Council as the power stations rateable values have been reduced considerably. Although the transitional arrangements have been announced it is not possible at this stage to produce the NNDR1 figures until the software has been updated.

3.15 The process is further complicated by not having full details of the reliefs that will

apply in 2107/18 such as Small Business Rate Relief. 3.16 It is for these reasons that figures cannot be presented to Cabinet for approval. As

the NNDR1 return has to be completed and submitted by 31 January 2017 it is proposed that approval to determine these figures is given to the Head of Finance and Property and reported to Extraordinary Full Council on 26th January 2107

4. Implications

a) For service users Services continue to be funded by a combination of locally retained business

rates and Revenue Support Grant. However the business rates quantum is relatively fixed, so central government is using the Revenue Support Grant element to manage reductions in the central budget aligned with the well-publicised cuts in national public spending.


The manner in which local government is funded will change over the coming years with RSG disappearing and Business Rates becoming the main source of income. It is likely that total funding levels will be eroded over time.

c) Financial - Ref: 17/513 The provisional Local Government Finance Settlement was announced on

15th December 2016, with Revenue Support Grant being set at £1.191m and baseline retained business rates of £3.788m for 2017/18.

The Chancellor has proposed to remove the Revenue Support Grant by

2019/20 and replace the mechanism with 100% of business rates. Further announcements are awaited.

d) Legal – Ref: 702/01/17

The Council has a duty under The Non-Domestic Rating (Rates Retention) Regulations 2013 (previously the Local Government Finance Act 1988) to prepare a business rate retention scheme and consider potential policy arrangements available within Nottinghamshire.

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e) Human Resources

None.

f) Community Safety, Equalities, Environmental

The business rate retention scheme has been subject to an initial Equality Impact Assessment for Bassetlaw. There is no need to progress to a full EIA, as there is no evidence of any potential adverse impact.

g) This is Key Decision No. 603. 5. Options, Risks and Reasons for Recommendations 5.1 The figures reported in the Appendix represent the best estimates of the likely

retained business rates forecast for 2017/18 and associated surplus at the end of 2016/17. The final NNDR1 return and any associated changes to this report will be reported to Members as part of the referral to the Extraordinary Council meeting on 26th January 2017.

6. Recommendations 6.1 That Cabinet delegates the determination of the figures shown below on the NNDR1

form to the Head of Finance and Property:

• the net yield from local business rates; • the cost of collection allowance; • the amounts retained in respect of renewable energy schemes; • the declared surplus at the end of 2016/17.

6.2 That Cabinet recommends this report to the Extraordinary Council on 26th January

2017 where the final figures from the NNDR1 return for 2017/18 will be considered.

Background Papers

Location

Head of Finance & Property office

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Agenda Item No. 4(c) BASSETLAW DISTRICT COUNCIL



HOUSING CAPITAL PROGRAMME 2017/18 TO 2021/22 Cabinet Member: Finance Contact: Dave Hill Ext: 3174 1. Public Interest Test 1.1 The author of this report, Dave Hill, has determined that the report is not confidential. 2. Purpose of the Report 2.1 To consider and approve the Housing Capital Programme for 2017/18 to 2021/22. 3. Background and Discussion 3.1 As part of the arrangements for the new HRA self-financing regime, the Council

prepared a 30 year Business Plan which identified the levels of capital expenditure required to maintain council housing stock at the ‘Decent Homes’ standard prescribed by central government into future years.

3.2 As a result of this work, an initial five year capital programme was developed for the

period 2012/13 to 2016/17, which covered the four elements of:

• Decent Homes; • Fuel Poverty; • Crime & Disorder; • Disability.

3.3 As the final year is now coming to an end, the Business Plan has been fully

developed into a ‘live’ model that is updated on a continuous basis to reflect any changes that materialise. The commitment made in the original Business Plan regarding the first five years of the capital programme remains in place, with later years being added and revised according to latest information. This is important as 2013/14 heralded the end of the Decent Homes funding, and this programme now looks at wider agendas and is therefore more balanced and diverse.

Major Improvements 3.4 In considering the schemes and the funding available, the first task is to maintain the

Decent Homes standard going forward. Appendix 1 shows that a total of £21.2m has

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been identified as a five-year commitment to maintain the housing stock at minimum decency levels.

Green Energy

3.5 One of the biggest risks to the financial stability of Bassetlaw’s tenants is their ability

to pay energy bills and a level of household income that prevents them from being classed as ‘fuel poor’. The aim of this set of priorities in the capital programme is to minimise fuel poverty wherever possible, ensuring properties have good levels of insulation, A-rated boilers, solar PV, renewable energy and efficient well maintained heating schemes. A1 Housing set itself a target of 20% of the stock to be on some form of renewable heating by 2020.

3.6 A1 Housing have developed a sound tradition of pioneering air source and ground

source heat pumps to properties that were previously dependent on expensive heating systems. A number of schemes have therefore been included in the 2017/18 – 2021/22 Capital Programme. The programme areas identified in Appendix 1 cumulate in an investment of £2.5m over the five years covered in this report, with £0.7m being recommended for 2017/18. Expenditure will be committed to external wall insulation to solid wall properties, boiler and heating replacements.

Decent Neighbourhoods

3.7 Other emerging priorities are anti-crime and community safety measures. The commitment to this is for £1.1m in 2017/18, with an outline total of £4.8m invested by the end of 2021/22.

3.8 This priority group of projects includes not just property protection, but also environmental protection to assist with community wide safety. Crime risk can be minimised in the home with ‘Secured by Design’ windows and doors, but it is often the community projects that reduce anti-social behaviour and crime. Community safety doesn’t however solely refer to crime but includes fire risk assessments, health protection from poor sanitation, waste management (2 or 3 bin systems for properties designed for only a single bin), Housing Health & Safety Rating System, safe car parking, putting footpaths into good repair and properties in a good state of structural repair.

3.9 Fire Risk Assessments have provided one of the most significant additional funding

requirements over the last few years. This will have to remain one of the first priorities on the annual delivery programme.

Homes for Life

3.10 Commitments to meet Equality Act requirements for tenants living with a disability and further home adaptions are being put forward with some £0.5m in 2017/18, with a total of £2.7m by the end of 2021/22.

3.11 The main thrust of this area will be the requirement for the delivery of adaptations to council tenants (to mirror the Disabled Facilities Grant process for private sector residents). As part of this process it is important Bassetlaw remains innovative and adopts initiatives designed to reduce accidents and prevent the decline in people’s health prematurely. This is where self-referral schemes are important. In addition, though this will always be a desire, the lifetime homes criteria (16 points relating to access in and around the home) should always be adopted wherever possible and

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schemes to improve some suitable properties would be beneficial. With new-build schemes, lifetime homes should always be a criteria for consideration.

3.12 Any pressures in this area can be kept to a minimum through good asset

management and by obtaining grants wherever possible and working with partner organisations such as United Living, energy companies and maximising tariff schemes to ensure any duplication is removed from processes. Ensuring procurement gives value contracts that deliver both the product, the service and specifications that ensure product delivery is maximised and repair obligations minimised. Relying on capital budgets without including the above will always leave Bassetlaw behind the times.

Other Schemes 3.13 The HRA capital programme includes details of other schemes as follows:

• Abbey Grove – a report was taken to Cabinet in December 2016 that presented the chosen development for the current site at Abbey Grove. A sum of £8.1m has been included in the capital programme which is dependent upon external contributions of £4.0m from Nottinghamshire County Council and HCA.

• New Build Contribution – a sum of £6.0m has been included within the programme in the latter years to enable further options for new build to be considered.

• Vehicle Fleet Replacement – A1 Housing operate a varied fleet and some vehicles

can expect a longer life than others. A replacement programme has been included in the 30 year business plan based on a life of between six and seven years for each vehicle.

• Non Dwelling Assets (Community Centres, boiler houses, garages etc.) - these have

received very little capital investment over the last few years, and the programme has set aside a total of £0.5m within this five year period to provide for capital improvement work. A report was brought to the October 2012 Cabinet meeting regarding the conversion of a number of community centres into dwellings.

• Contribution to Flood Prevention Schemes – The Council is very proactive in developing new flood prevention schemes, and an annual contribution from the HRA is made towards the overall costs of protecting the HRA properties.

• Damp Proofing Works – There is a need to inspect and provide damp proofing works

to properties, and a sum of £0.6m has been included in the five year programme.

• Asbestos Encapsulation / Removal - a rolling programme to identify areas at risk of deterioration and take the appropriate action.

• Electrical Installation Condition Testing – This is a health and safety issue, and a sum of £1.6m has been included in the five year programme to deliver this testing programme.

• Planned Works – Many properties require additional works in excess of the decent homes standard and a budget of £1.9m has been included for this purpose.

• Beverley Road and Amanda Road New Build - demolition of community centre and last pair of Airey houses and construct 7 dwellings.

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• Other minor schemes include:

o flats above shops, comprising replacement of external elements to improve weather resistance;

o lightning protection improvements to blocks of flats following fire risk assessments;

o compartmentation work within flats to reduce fire risks where Type 3 Fire risk assessments have indicated compartmentation surveys be carried out to determine levels of compartmentation in blocks of flats, and

o demolition of Styrrup Road/Common Lane to reduce the risk of anti-social behaviour and accommodate a new build scheme.

Funding

3.14 The Self Financing Regime for the Housing Revenue Account commenced in April

2012, and under it councils can self-finance capital investment provided they maintain their commitments within the borrowing limit. In addition to this, capital receipts from council house sales can also be used to finance capital expenditure, and if there is enough flexibility, revenue contributions to capital can also be made to provide additional funding through the Major Repairs Reserve (MRR).

3.15 In summary, the Housing Capital Programme for 2017/18 totals £11.185m, which is

to be funded by:

• £4.089m from the Major Repairs Reserve; • £0.711m from External Funding; • £1.000m from the New Build Reserve; • £5.000m unsupported borrowing; • £0.385m of capital receipts.

3.16 Members will note that the Major Repairs Reserve is funded from a combination of

asset depreciation charges and other revenue contributions, and this level of revenue contributions is significant to the coherence of the unfolding plan. It also emphasises the importance of the value for money savings within the Housing Revenue Account, and the commitment required on rents to maintain the level of quality that tenants now expect and are demanding.

Capital Receipts and the Right to Buy Scheme 3.17 Under changes approved by Parliament in April 2012, local authorities were given the

option of either transferring all Right to Buy receipts in excess of a government-set sales target back to central government, or to retain the receipt and reinvest in replacement homes.

3.18 Bassetlaw opted to retain the additional Right to Buy receipts, and this means that the receipts:

a) Must be used for the provision of affordable rented homes; b) Will constitute no more than 30% of total investment in such homes (net of any

contribution from another public body); c) If they have not been used after three years, the Council will pay the unused

sums, plus interest, back to the Secretary of State. 3.19 As part of the introduction of the self-financing scheme, the government set

Bassetlaw a Right to Buy sales target of circa 18 properties for 2017/18. This means

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that Bassetlaw will only retain 100% of the capital receipt from property sales in excess of this figure. In the interests of prudence, no retained right to buy receipts have been included within the updated business plan.

3.20 However, the 30 year Business Plan does include an assumption of £0.385m of Right

to Buy receipts being generated in each financial year.

Affordability 3.21 Bassetlaw’s Overall Borrowing Limit under the self-financing valuation is £105.4m,

and the Council cannot breach this limit. In considering the report Members therefore need to see the interaction between existing commitments, the existing level of HRA long term debt, the amount of internal and temporary borrowing, plus the commitments outlined in this report, less any loan repayments and/or new borrowings.

3.22 The updated HRA Business Plan provides the assumptions for the Council’s loan

financing profile over the next thirty years. For information, the scheduled long term debt repayments that are built into the Business Plan over the next 10 years are:

• 2017/18 - £5.6m • 2019/20 - £3.3m • 2022/23 - £4.1m • 2023/24 - £3.3m

3.23 It is the marginal value between these components that Members need to assess

over the period of the capital programme:

2017/18 £m

2018/19 £m

2019/20 £m

2020/21 £m

2021/22 £m

Overall Borrowing Limit 105.436

105.436

105.436

105.436

105.436

Less:

Existing HRA Long Term Debt @ 1st April 95.643 95.052 95.052 96.279 96.279

Internal Borrowing @ 1st April

0 0 0 0 0

Additional Borrowing in year 5.000 0.000 4.500 0.000 0.000

Plus:

Scheduled Debt Repayments in year (5.591) 0.000 (3.273) 0.000 0.000

Equals:

Existing HRA Long Term Debt @ 31st March 95.052 95.052 96.279 96.279 96.279

Margin of Safety @ 31st March:

10.384 10.384 9.157 9.157 9.157

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3.24 As the above figures show, with the cessation of the Decent Homes programme there is a direct impact on the decisions made on:

(i) the level of capital investment; (ii) the pace of that investment; (iii) the levels of rent that tenants will be asked to pay for the quality of homes they

live in. 3.25 As has previously been highlighted, affordability in the revenue account is the

essential ingredient, and does not directly correlate with the value of the Margin of Safety outlined above. The former is about working within set revenue budgets whilst retaining the minimum working balance determined by the Council. The latter is about the ‘potential’ to borrow but does not consider the revenue costs and affordability associated with that borrowing.

3.26 The revenue implications need to be considered when deciding about the pace of

investment and improvement. If an ambitious and proactive approach is taken in 2017/18 and 2018/19 then overspends will occur in the revenue account which will take it below the approved minimum working balance of £1.3m.

3.27 The four maturing loans as outlined above will all be repaid in year. However, due to

the prescribed 1% cut in rents, some of the flexibility in the HRA Business Plan from 2017/18 has been lost. There is now a need to re-borrow similar amounts to those repaid to keep the business plan a viable option over the next five years.

4. Implications

a) For service users.

Considered in tandem with the Housing Revenue Account Budget 2017/18 & Future Years to 2019/20 report the link between capital decisions on investment and the revenue account is self-evident, as is the relationship between income (rents) and expenditure (improvements and repairs). This is partly skewed by the control of the Overall Borrowing Limit and Members need to decide if they wish to pace the level of improvements or make immediate commitments to the programme submitted on the priority areas put forward.

b) Strategic & Policy.

There are a number of programme areas that are/will emerge as part of the post Decent Homes era, and from within the Corporate Plan for Bassetlaw. These are outlined in the report.

c) Financial - Ref: 17/360

The Chancellor’s announcement regarding a 1% rent reduction each year for four years has effectively meant a 3% swing (as the business plan projected a 2% increase in rent each year). This has significantly impacted on the business plan in that £30.2m of rent has been lost as result of this decision over the next ten year period. Ultimately this decision has forced some difficult decisions to be made, resulting in the commitment to the capital programme being maintained, with the consequence of the repayment of debt being deferred to later years.

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d) Legal - Ref: 703/01/17

The Council needs to ensure compliance with the Equality Act 2010 and theappropriate levels of decency for its properties.

e) Human Resources

None arising directly from this report.

f) Community Safety, Equalities, Environmental

The programme has been developed through tenant consultation. Ensuringthe suitability of property for disabled users has been reflected in thescheme’s priorities.

g) This is Key Decision No. 604.

5. Options, Risks and Reasons for Recommendations

5.1 Members can decide what schemes to include or exclude, and the timing of thosecommitments. The summary provided under the section ‘Affordability’ sets out the fullsituation. In coming to a view on what priorities Members want to establish,consideration must be given to the overall limit on investment set by the OverallBorrowing Limit of £105.4m, coupled with the impact that long term borrowing has onthe affordability within the Housing Revenue Account.

6. Conclusions

6.1 The year 2013/14 saw the end of government funding for the Decent Homesprogramme, but for Bassetlaw, the legacy and further commitment to the programmewill be ongoing.

6.2 What should be avoided at all costs is a full commitment right up to the OverallBorrowing Limit of £105.4m. The Council will always need some room formanoeuvre and for this reason only full approval for the 2017/18 programme is beingsought at this stage. Following years’ capital programmes are therefore only beingapproved on an indicative basis and will be confirmed in succeeding financial years.

6.3 The government-prescribed reduction in rent has had a significant detrimental impacton the sustainability of the HRA Business Plan, and caution should be exercisedwhen considering any more proposals for new build in the medium term up to 2020.

7. Recommendations

7.1 That Members approve the programme set out in Appendix 1 of the report for2017/18.

7.2 That Members approve the indicative programmes for 2018/19 – 2021/22 inAppendix 1 of the report.

7.3 That Cabinet recommends the report to the Extraordinary Council meeting forapproval on 26th January 2017.

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Background Papers Location

A1 Housing Capital Schemes

HRA Self Financing data

Head of Finance & Property’s office

46

2017/18 2018/19 2019/20 2020/21 2021/22 TOTAL£'000 £'000 £'000 £'000 £'000 £'000

MAJOR IMPROVEMENTSMaintaining the Decent Homes standard 3,500 4,491 4,327 4,450 4,450 21,218 GREEN ENERGY

External Wall Insulation to Solid Wall Properties 300 - - - - 300

Boiler and Heating Replacements 440 440 440 440 440 2,200 DECENT NEIGHBOURHOODSFire Protection to Blocks of Flats with Communal Areas 350 370 370 370 370 1,830

Fire Risk Assessments - Sheltered Schemes 200 25 25 25 25 300 Stuctural Repairs 110 110 110 110 110 550 Improved Waste Storage Facilities in Communal Areas and Dwellings 55 55 75 75 75 335

Estate Parking Improvements 110 110 110 110 110 550 Smoke and Heat Detection 100 100 100 100 100 500 Repairs to Un-adopted Roads and Paths incl. Prospect 150 150 150 150 150 750

HOMES FOR LIFEAdaptations - from OT Referrals 500 500 500 500 500 2,500 Lifetime Homes Works/Communal Areas - Disability Access 40 40 40 40 40 200

OTHER SCHEMESAirey Housing, Harworth, incl Greenwood Ave 340 11 - - - 351 Abbey Grove 2,910 5,107 123 - 8,140 New Build Contribution - - 2,000 2,000 2,000 6,000 Vehicle Fleet Replacement - 450 450 450 450 1,800 Non Dwelling Assets (Community Centres, Boiler Houses, Garages etc) 100 100 100 100 100 500

Contribution to Flood Prevention Schemes 50 50 50 50 50 250 Damp Proofing Works 120 120 120 120 120 600 Asbestos Encapsulation / Removal 110 110 110 110 110 550 Electrical Installation Condition Testing and Rewires 310 310 310 310 310 1,550

Flats above shops 60 60 60 60 60 300 Lightning Protection 40 40 - - - 80 Beverley Road New Build 510 8 - - - 518 Compartmentation Work 30 30 30 30 30 150 Planned Works 300 400 400 400 400 1,900 Amanda Road new build 280 100 - - - 380 Demolition Styrrup Rd/Common Lane 170 - - - - 170

TOTAL SPENDING: 11,185£ 13,287£ 10,000£ 10,000£ 10,000£ 54,472£

2017/18 2018/19 2019/20 2020/21 2021/22 TOTAL£'000 £'000 £'000 £'000 £'000 £'000

Major Repairs Reserve 3,039 8,324 5,115 9,615 9,615 35,708 External Funding 711 3,878 - - - 4,589 New Build Reserve 1,650 300 - - - 1,950 Unsupported / Internal Borrowing 5,000 200 4,500 - - 9,700 Capital Receipts 785 585 385 385 385 2,525 TOTAL FUNDING: 11,185£ 13,287£ 10,000£ 10,000£ 10,000£ 54,472£

HRA 5 YEAR CAPITAL INVESTMENT PLAN

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APPENDIX 1

Agenda Item No. 4(d) BASSETLAW DISTRICT COUNCIL

CABINET

10th JANUARY 2017


HOUSING REVENUE ACCOUNT BUDGET 2017/18 AND FUTURE YEARS TO 2019/20

Cabinet Member: Finance Contact: Dave Hill Ext: 3174

1. Public Interest Test

1.1 The author of this report, Dave Hill, has determined that the report is not confidential.

2. Purpose of the Report

2.1 To consider and approve the Housing Revenue Account budget for 2017/18 andprovide indicative figures for 2018/19 and 2019/20.

2.2 To make recommendations to Council on the 26th January 2017 to set the budgetand rent levels for 2017/18.

3. Background and Discussion

3.1 Unlike the General Fund that comprises a range of different services, the HousingRevenue Account is a single service account which is funded by tenants’ rent incomefor the social housing and the landlord functions Bassetlaw provides via the Arm’sLength Management Organisation, A1 Housing. Therefore, all decisions on incomeand expenditure will have a direct impact on tenants’ service levels and the level ofinvestment in their homes.

3.2 This has been re-enforced by the new ‘Self Financing Regime for Housing’ whichbecame effective in April 2012. This means that expenditure now has to be entirelysupported from rental and other income. The main tool for the future financialmanagement of the HRA is the 30-year Business Plan.

3.3 The introduction of HRA self-financing did not end the requirement to maintain astatutory ring-fenced HRA, and the Council is still required to maintain a separateaccount for the income received and expenditure incurred on council housing.

The 2017/18 HRA Revenue Budget

3.4 The Housing Revenue Account is provided for information at Appendix 1. Due to thechanges made under self-financing, any favourable variance from the expected out-turn in year is now transferred to the New Build Reserve. This decision can, ofcourse, be changed if the 2017/18 outturn is significantly different to the planned

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budgets. This means that it is essential that the HRA adopts a long term efficiency plan over the next few years in order to protect services to tenants and ensure continued best value.

3.5 Under the old housing subsidy system, the government gave a Major Repairs Allowance (MRA) which was used to fund capital expenditure. Within the government’s self-financing settlement figures released in March 2012, this government guidance was followed for the required 5 years which finished in 2016/17. Depreciation represents a cash charge to the HRA which is required to be transferred to the Major Repairs Reserve (MRR) to provide for future capital expenditure and/or the repayment of debt. The level of depreciation chargeable to fund the capital programme is not sufficient to fund the capital programme and the repayment of debt, therefore a voluntary contribution of £2.89m is required during 2017/18.

3.6 The HRA outturn for 2016/17 is expected to deliver a £0.067m deficit in year, a positive variance of £0.033m over the original budget.

3.7 The estimated balances on the HRA and MRR are as follows:

HRA MRR £’000 £’000

Balance at 1 April 2016 1,619 3,058 Surplus/(deficit) (67) MRA (made up of Depreciation & additional payment)

7,019

Voluntary revenue contribution for repayment of debt/capital expenditure

1,710

Housing Capital Expenditure (9,455) Repayment of Debt 0 Balance at 31 March 2017 1,552 2,332

Surplus/(deficit) (201) MRA (made up of Depreciation) 5,380 Voluntary revenue contribution for repayment of debt/capital expenditure

2,890

Housing Capital Expenditure (4,689) Repayment of Debt (5,591)

Balance at 31 March 2018 1,351 322

MRR Balance Analysed Over: Housing Revenue Expenditure 1,351 Housing Capital Expenditure 304 Repayment of Debt 18 Balance at 31 March 2018 1,351 322

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Rents

3.8 As part of the Budget speech on 8th July 2015, the Chancellor announced that social housing rents will have to be cut by 1% each year for the next four years from April 2016. He said it was aimed at ending ‘the ratchet of ever higher housing benefit chasing up ever higher rents in the social housing sector’.

3.9 Taking this into account, the Council is recommending a rent reduction for 2017/18 of 1.0% or an average of £0.73 per week. This is broken down by property types as follows:

CHANGES BY PROPERTY TYPE Bedsit 1 Bed 2 Bed 3 Bed 4+ Bed 5+Bed Overall

£ £ £ £ £ £ £ 2016/17 53.51 66.07 75.19 79.68 87.02 96.56 74.16 2017/18 53.05 65.44 74.44 78.90 86.09 95.59 73.43 £ (0.46) (0.63) (0.75) (0.78) (0.93) (0.97) (0.73) % (0.86%) (0.96%) (0.99%) (0.98%) (1.06%) (1.0%) (1.0%)

(Based on a 52 week rent year)

Note: The above table is based on average income from each type of property, the following 2 items will affect the calculation of the % decrease in the above table:

• During the year the housing stock may be revalued which could affect theweekly rental charge. During 2016/17 4 dwelling bedsit units had beenrevalued.

• All right to buys have the potential to affect the % decrease in the dwellingrental weekly charge.

3.10 The recommended rent reduction for 2017/18 and 2018/19 is also assumed to be 1.0% as follows:

Average reduction 2017/18

Average reduction 2018/19

Per Week £

% Per Week £

%

(0.73) (1.0%) (0.72) (1.0%) (Based on a 52 week rent year)

3.11 There is a variation for tenants at the new Harworth development. All tenants that have been decanted to their new properties are charged at Social Rent whilst all future tenants moving onto this development site will be charged at an Affordable Rent of 80% of market rental value.

3.12 Whilst there may be some concerns nationally about the level of rents, approximately 59% of tenants get assistance through the Housing Benefit scheme, and 65% of those on HB (38% of all tenants) receive a full rebate and pay nothing. Housing Benefit is met by a charge to the General Fund, and in turn this is met by a grant from the DCLG currently covering 99.4% of the actual costs.

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Repairs & Maintenance

3.13 The amount of money spent on responsive repairs is estimated at £6.6m for 2017/18, compared to £11.1m for planned maintenance in the HRA’s capital budget. This balance is deemed to be sound compared to the standard split of 40% responsive and 60% for planned repair expenditure.

Pensions Provisions

3.14 Under the contract arrangements with A1 Housing they include, via the Management Fee, the payment of all the employers’ pension contributions from the start of the A1 contract. Bassetlaw is required to pay any shortfall for the employers’ contributions before this time. Currently an estimate of £0.75m is included for 2017/18 which is the final payment and all the arrears for pensions will be met.

Depreciation

3.15 Under the previous HRA regime depreciation (the annual charges made to reflect historic assets and improvements) was an in/out adjustment which made no difference to the overall level of HRA resources. Under the Self Financing regime these calculations are more important as all depreciation adjustments are in effect ‘real’ cash set aside for investment, and then used up once the asset or improvement they originally financed needs to be replaced. The 2017/18 budget for depreciation is £5.4m, and this is transferred into the Major Repairs Reserve to fund future capital expenditure.

Value For Money and the A1 Housing Management Fee

3.16 All elements of the HRA budget and business plan are subject to review in relation to value for money. In addition, the impact of any General fund Budget Review savings and service reviews will achieve reductions in costs for the Housing Revenue Account, thus releasing additional resources for the housing stock.

3.17 Whilst no specific savings targets have been set for A1 Housing moving forward in the Business Plan, there is expectancy that greater emphasis will be placed on sharing services with the Council, resulting in savings for both organisations.

2017/18 2018/19 2019/20 £’000 £’000 £’000

Repairs and Maintenance 6,360 6,445 6,545 Supervision & Management-General:

- A1 staff/services 2,557 2,587 2,615 - BDC SLA’s 1,635 1,647 1,657 - Welfare Reform 50 50 50

Supervision & Management-Special: - Rates on Void Properties 60 60 60 - Supporting People 438 451 485 - District Heating Fuel 54 55 54 - Decent Neighbourhoods-

Caretakers and Works528 539 550

- Grounds Maintenance SLA 357 360 364

- Support to Tenants Organisations 60 60 60 - Community Centres & Sheltered 160 160 160

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Schemes Total: 12,259 12,414 12,600

3.18 The basis for each element of the management fee can be analysed as follows:

• Repairs and Maintenance – This has been linked to the rate of inflation (CPI)and has been increased by 1.0% for 2017/18 with an assumed increase of2.0% each year thereafter.

• A1 Staff/Services - This has been increased by 1.0% each year in line with theassumptions made on pay awards.

• BDC SLA’s – This is primarily based on recharges of staff time, thereforeincreases have been linked to the assumed pay increase each year.

• Welfare Reform – The Council has previously provided additional resources toA1 Housing for a money advice service and additional recovery work, and thisis a continuation of this investment.

• Rates on Void Properties – This is a sum to recognise the payment of counciltax that is incurred during the one-month void period.

• Supporting People – This is for the warden alarm service and visits where theHRA retains the income and passports this back to A1 Housing via themanagement fee.

• District Heating Fuel – This is the cost of fuel that is subsequently rechargedback to tenants. The HRA retains the income and passports this back to A1Housing via the management fee.

• Decent Neighbourhoods – This budget pays for the costs of the communitycaretakers, and increases have been aligned to the annual pay award. Anallocation is also made for neighbourhood improvement works.

• Grounds Maintenance SLA - This budget pays for the costs of groundsmaintenance in the council-owned areas of land, and inflationary increaseshave been aligned to the annual pay award.

• Support to Tenants Organisations – This has been fixed at an annualcontribution of £60,000.

• Community Centres and Sheltered Schemes – this is the cost of running theseservices.

3.19 As part of the contractual agreement, the management fee can be varied during the year by a Cabinet decision.

Provision for Bad debts

3.20 Current changes to welfare reform, including the ‘bedroom tax’ for under occupancy, and the introduction of the Local Council Tax Reduction Scheme from April 2013, all have the potential to increase the level of debts outstanding for council house rents.

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It is therefore prudent that the Council takes measures to mitigate the financial impacts of these changes. These include an annual bad debt provision of £150,000, and the welfare reform initiatives as identified above.

Treasury Management

3.21 As part of the new self-financing arrangements, Bassetlaw inherited £26.9m of the national housing debt in March 2012, which increased its overall HRA debt level to £96.5m. This debt has been reduced over the last 4 years by £1.9m as at the 31st March 2016 the debt stood at £94.6m Overall this has an average debt interest rate of 3.98% and these figures are reflected in the budget profiles. This level of debt and average interest rate will fluctuate over time as existing loans mature and decisions are made as to whether to replace or pay off debt in the longer term.

3.22 As part of this transfer of debt, the government set Bassetlaw an overall HRA borrowing limit of £105.4m. The Council is taking a very prudent approach to this as for every additional £1m in borrowing, the cost to the HRA budget will be c£40,000 per annum. However, Members may, in due course, wish to utilise this borrowing ‘gap’ for further investment in our housing stock, or to self-build, but the affordability of the revenue budget will always be the controlling factor.

3.23 The updated HRA Business Plan provides the assumptions for the Council’s loan financing profile over the next thirty years. For information, the scheduled long term debt repayments and associated reductions in interest costs that are built into the Business Plan over the next 10 years are:

• 2017/18 - £5.6m• 2019/20 - £3.3m• 2022/23 - £4.1m• 2023/24 - £3.3m

3.24 Due to the introduction of 1% rent reductions each year for four years, re-borrowing will be necessary to retain the Council’s current levels of capital investment, and for this reason further borrowing has been built into the HRA Business Plan as follows:

• 2017/18 - £5.0m• 2019/20 - £4.5m• 2022/23 - £4.0m• 2023/24 - £4.0m

3.25 The Treasury Management Strategy 2017/18 to 2019/20 being reported to Cabinet in February 2017 will detail the borrowing requirements of the Housing Revenue Account. To ensure the stability of the HRA, its debt portfolio is that of long-term fixed rate borrowings. Therefore, for the purposes of Treasury Management, any additional borrowing requirement will be facilitated through similar fixed term loans.

Reserves

3.26 Due to the uncertainty around the new self-financing arrangements, the level of recommended minimum balances for the Housing Revenue Account was increased to £1.3m in April 2013. There are a number of benchmarks that are used for Housing authorities to determine the correct level as follows:

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£,000 £200 per property (Housing Finance Act 1989 recommended £150 based on 6,840 properties)

1,368

5% of dwelling rental income 1,296 5% of gross expenditure (excl. transfers to MRR) 1,204 Average of the 3 options 1,289

3.26 As the results of the three options are wide-ranging, it would be prudent to keep the minimum working balance under review each year. However, for 2017/18, it is recommended that the Council retains the minimum working balance at £1.3m.

3.27 This prudent approach reflects the level of uncertainties arising from welfare reform and the potential for tenants to accrue significant debts under these changes. In addition, the major work programmes planned under the Housing capital programme will require some properties to be held void, which reduces rent income levels. Reserves should not be used to mitigate rent levels as this would only be effective in the short term.

4. Implications

a) For service users.

Bassetlaw provides 6,840 homes for its residents, and this makes up some14% of the number of homes in the district. The housing service hasimproved under the ALMO arrangements and significant resources have beenspent on improving the condition of the housing stock.

b) Strategic & Policy.

Decisions about the long term financial health of Bassetlaw’s council housingare now local ones, and Members now have a lot more influence over moresignificant matters of choice than previously. Long term decisions aboutquality and rent income are more pronounced, as is the long term financialstability of Bassetlaw’s HRA. With the end of the Decent Homes programme,Members need to consider what improvements they wish to make to theCouncil’s housing service, but this needs to be affordable both in the shortand long term.

If Members wish to be positive about the improvements that can be madethen they need to generate the income to pay for them, and this will influencethe Council’s rent policies (where possible). As with anything else,improvements need to be funded accordingly.

c) Financial – Ref: 17/828

These are set out in the report, but the point that needs to be emphasised isthat any decision now will impact over the long term. The recommended rentdecrease is based on the government’s set parameters of a 1% rentreduction, and this has removed £30.2m from the HRA Business Plan overthe next ten-year period. This has necessitated the modelling of £18.5m offurther long term borrowing going forward to keep the Business Plansustainable. This means that any further investment over and above that

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planned needs to be considered very carefully for its impact on the viability of the Housing Revenue Account.

d) Legal – Ref: 701/01/17

These are set out in the report.

e) Human Resources.

There are none arising from the report.

f) Community Safety, Equalities, Environmental.

The Council must ensure that decisions are made in such a way as tominimise unfairness and ensure that there is not a disproportionate effect onany protected group as defined in Equalities legislation. Recommendations toincrease/decrease rent levels do not directly discriminate any particularlygroup as they apply across all tenants. Both A1 Housing and BassetlawDistrict Council provide financial and welfare advice and work with voluntarysector partners to ensure tenants can receive advice and support.

g) This is Key Decision No. 605.

5. Options, Risks and Reasons for Recommendations

5.1 The Council needs to set a balanced budget for its HRA services with incomeequalling expenditure, and ensure that:

(i) it does not breach the overall borrowing limit of £105.4m at any stage. TheKPMG External Auditor will take action if it does.

(ii) the Housing Revenue Account remains solvent, with the adequate reserves ofa “going concern”.

5.2 This budget sets out the approach to maintain levels of quality and investment, and comply with the borrowing limit. The rent reduction of 1.0% could be lowered even further, but this will impact on the levels of investment in this and successive financial years.

5.3 The Budget assumptions are based on the HRA Business Plan. The associated risks include any variances in estimates for inflation, interest rates, volume of voids, and the number of Right to Buy sales.

5.4 The viability of the Business Plan is based on the management of debt levels coupled with investment in the Council’s existing and new stock. In reality the Business Plan needs to be flexible enough to cope with changes to this strategy over time.

6. Conclusions

6.1 The Council now has a self-sufficient HRA, in which income from tenants is used to pay for the delivery of services to tenants and investment in the housing stock. The transition to self-financing represents a key shift in risks, with the Council taking full

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responsibility for managing and maintaining its own housing stock in return for access to all of its revenue income.

6.2 For these reasons the budget has been framed to minimise any risks identified. Members have a clear set of recommendations to support a soundly financed housing service as the 2017/18 budget will set the foundation for the next 30 years of council house funding in Bassetlaw.

7. Recommendations

7.1 That Members approve the Housing Revenue Account budget set out in Appendix 1of the report for 2017/18.

7.2 That Members approve the indicative Housing Revenue Account budgets set out inAppendix 1 of the report for 2018/19 and 2019/20.

7.3 That Members approve an average rent reduction of 1.0% for 2017/18 in accordancewith government policy.

7.4 That Members approve that all new tenants moving to the Harworth developmenttheir dwelling rent is set at 80% of market rent.

7.5 That Members, in accordance with best practice, approve the indicative rentreductions of 1.0% for both 2018/19 and 2019/20.

7.6 That Members approve the minimum level of HRA reserves to remain at £1.3m inrecognition of the overall funding value of the HRA.

7.7 That Cabinet recommends this report to the Extraordinary Council meeting forapproval on 26th January 2017.

Background Papers: Location:

Self-Financing Data Head of Finance & Property’s office HRA Budget Papers

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APPENDIX 1

BUDGET 2016/17

Employees £

Premises £

Transport £

Supplies and

Services £

Third Party Payments

£

Internal Services

Recharged £

Capital Charges

£

GROSS EXPEND

£INCOME

£

NET EXPEND 2017/18

£

ESTIMATE 2018/19

£ESTIMATE

2019/20 £A1 Housing

60,000 A1 Management - Rents Rates & Taxes 60,000 60,000 60,000 60,000 60,0005,547,800 A1 Management - Supervision and Management 5,789,600 5,789,600 5,789,600 5,859,100 5,944,5006,323,400 A1 Management - Repairs & Maintenance 6,359,700 6,359,700 6,359,700 6,445,100 6,545,500

50,000 A1 Management - Welfare Reform 50,000 50,000 50,000 50,000 50,00011,981,200 Total A1 Housing Management Fee 0 0 0 0 12,259,300 0 0 12,259,300 0 12,259,300 12,414,200 12,600,000

Council Managed HRA Budgets

Expenditure150,000 Movement in the Allowance for Bad Debts 150,000 150,000 150,000 150,000 150,000

44,100 Debt Management Costs 82,200 82,200 82,200 83,000 83,80080,000 Negative HRA Subsidy Limitation 0 0 0 0 0

5,288,700 Depreciation and Impairment of Non-Current Assets 5,479,500 5,479,500 5,479,500 5,625,100 6,074,000728,200 Management Costs 42,500 226,100 1,000 142,000 115,000 380,600 907,200 907,200 818,400 823,100

6,291,000 Total Council Expenditure 42,500 226,100 1,000 292,000 115,000 462,800 5,479,500 6,618,900 0 6,618,900 6,676,500 7,130,900

Income-75,400 District Heating - Charges 0 -52,200 -52,200 -53,200 -54,200

-26,403,400 Rent Income - Dwellings 0 -25,909,800 -25,909,800 -25,520,800 -25,765,100-231,000 Rent Income - Garages 0 -234,300 -234,300 -239,000 -243,700289,600 Rent Income - Voids 0 267,700 267,700 265,800 269,000-85,200 Community Centre - Charges 0 -83,600 -83,600 -85,200 -86,800-94,000 Rent Income - Shops 0 -101,400 -101,400 -105,200 -105,200

-6,800 Rent Income - Land & Wayleaves 0 -7,000 -7,000 -7,000 -7,000-439,800 Supporting People Warden Service Charges 0 -438,500 -438,500 -447,400 -471,900

-32,500 Contributions Towards Expenditure 0 -109,800 -109,800 -109,800 -109,800-27,078,500 Total Income 0 0 0 0 0 0 0 0 -26,668,900 -26,668,900 -26,301,800 -26,574,700

328,700 HRA Services share of Corporate and Democratic Core 365,700 365,700 365,700 369,400 373,100125,000 HRA Share of Other Amounts 190,000 190,000 190,000 190,000 190,000

-8,352,600 Net Income/Costs for Service 42,500 226,100 1,000 847,700 12,374,300 462,800 5,479,500 19,433,900 -26,668,900 -7,235,000 -6,651,700 -6,280,700

32,500 Gain (-) or Loss on Sale of HRA Non-Current Assets 32,500 1,100,000 1,132,500 -1,110,000 22,500 5,000 -12,5003,787,400 Interest Payable and Similar Charges 3,870,300 3,870,300 3,870,300 3,855,900 3,912,100

-6,900 Interest and Investment Income 0 -13,800 -13,800 -13,000 -13,000-29,200 Capital Grants and Contributions Receivable 0 0 0 0 0

-4,568,800 Surplus (-) or Deficit for the Year on Service 42,500 226,100 1,000 847,700 12,406,800 462,800 10,449,800 24,436,700 -27,792,700 -3,356,000 -2,803,800 -2,394,100

Movement on HRA Balance

-5,188,700Charges for Depreciation and impairment on non-current assets -5,379,500 -5,379,500 -5,525,100 -5,974,000

-50,000 Revenue Expenditure Funded from Capital Under Statute -50,000 -50,000 -50,000 -50,0000 Gains/Loss (-) on Sale of HRA Non Current Assets 0 0 0 0

-32,500 Capital Expenditure Charged against the HRA 1,090,000 -1,122,500 -32,500 -15,000 2,500

1,210,000Employers Contribution Payable to NCC Pension Fund and Retirement Benefits Payable Direct to Pensioners 750,000 750,000 0 0

8,729,500 Transfer to Major Repairs Reserve 8,269,500 8,269,500 8,375,100 8,424,000

4,668,300 Net Additional Amount Required by Statute 3,557,500 2,785,000 2,402,500

99,500 Net (Increase) or Decrease in HRA Balance in Year 201,500 -18,800 8,400

£ Balance Brought Forward -1,552,408 -1,350,908 -1,369,708Balance b/fwd @ 1 April 2016 -1,619,108 HRA Surplus (-)/Deficit 201,500 -18,800 8,400Budgeted HRA Deficit 2016/17 99,500Projected Year End Variance -32,800 Balance Carried Forward -1,350,908 -1,369,708 -1,361,308Balance c/fwd @ 1 April 2017 -1,552,408

Housing Revenue Account - Budget Forecast 2017-2020

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