2021-22 Housing Revenue Account (HRA) budget

2021-22 Housing Revenue Account (HRA) budget

Below is an overview of how the rents and service charges paid by our tenants and leaseholders will be spent during this financial year 2021-22. 

pie chart

Item Amount
Repairs and maintenance £33.9m
Improvements to existing housing stock £34.6m
Managing tenancies £32.2m
Interest on borrowing £11.2m
Special services £9.8m
Other £0.5m

The largest areas of spend are improvements to the existing stock, followed by repairs and maintenance then services to manage tenancies. This includes collecting income, tackling anti-social behaviour and breaches of tenancy conditions, dealing with tenancy changes, providing support. 

For 2021-22 there is also a £64.8m budget to build or buy new homes that will be managed within the HRA. These homes are funded from other funding sources including retained right to buy receipts, that can only be used for providing new homes. 

30-year business plan

The table below shows how rents and service charge income would be spent over the next 30 years, if we provided the same level of service and costs remained the same (zero inflation). 

We know costs will change, the figures provide a simplified starting point. The budget simulator uses these same figures.

  30 year cost based on 2021-22 budget
Repairs and maintenance £1,017m
Improvements to existing stock £1,038m
Managing tenancies £966m
Interest on borrowing £336m
Special services £294m
Other £15m
Total £3,666m

2022-2023 budget

Every financial year the HRA sets a new annual budget, which is updated to reflect expected changes including:

  • decisions made regarding the annual rent and service charge review 
  • level of planned investment in homes  
  • one off costs, such as investment to improve our IT 
  • new budgetary pressures or requirements
  • inflationary uplift in costs for contracts, materials, utilities, staffing or commissioned services

For 2022-23 it is anticipated there will be significant increase in costs for materials and utilities, for example:

  • the new kitchen replacement contract figures will result in a 16% increase in costs per kitchen
  • changes in electrical regulations will translate to an increase in costs of each rewire, an additional £1,000 (30%) per home, to meet the new standards
  • replacement roof costs are forecast to be 20% higher 
  • the cost of materials used in construction if new homes are increasing, and they may be increasingly hard to source

Whilst every effort is made to deliver value for money, we are being effected by national issues and challenges.

It is likely that next year we will need to spend more to deliver our core services and planned levels of maintenance and investment.  These are things we must do to meet our legal and regulatory responsibilities, so are not open to consultation.

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