Decision details

A report was presented to Cabinet giving an update on our approved affordable housing development programme, which has been previously agreed by full council as part of the approved Housing Revenue Account Capital Programme.

The council has previously committed capital funding of £8.8m, from the Housing Revenue Account Capital Programme, for the delivery of Phase 4 of its affordable housing development programme, spanning the 2020-24 financial years. Phase 4 included 14 property acquisitions (already completed) and 22 new build homes, which are due to start on site in March 2023. The Capital Programme approved by Council in February 2022 agreed a further ongoing annual budget of £8.1m from 2024/25 for the ‘New Build Phase 5’ scheme, funded from borrowing.

This report seeks approval of the adjustment to the timescales of delivery to spend the already allocated budget and an increased number of new build units from 22 to 47, so that the total number of homes provided in phase 4 will increase to 61. A total of 60% of this funding is through borrowing, with the balance of 40% funding from retained right-to-buy receipts.

Cabinet agreed the following:

1.  An increase in the number of homes to be delivered as part of Phase 4 from 36 to 61;

2.  That £8.1m for 2024/25 vired from the ‘New Build Phase 5’ capital scheme be transferred to the ‘New Build Phase 4’ scheme, to accommodate the scheme of works set out in this report; and

3.  The ‘New Build Phase 4 scheme’ budget for 2024/25 is increased by £0.2m, to be funded from the borrowing allocated to and a corresponding decrease in the ‘New Build Phase 5’ scheme budget for 2025/26.

The programme will ensure the delivery of around 61 new or acquired homes for affordable rent and will commit all of the available funding, including the right-to-buy 1-4-1 receipts allocated to this programme.

Other options considered which were rejected as the delivery of new homes by TDC is important were:

1. Allocate funding to the acquisition of new homes, the acquisition of land for new homes and for construction, as set out above. This option is recommended and is in line with the approved Capital Programme.

2. Use the 1-4-1 receipts to provide grant funding to a Registered Provider (Housing Association) to provide affordable homes. This option is not recommended as 1-4-1 funding provides match funding to the  approved  capital programme. In addition new homes provided within the Housing Revenue Account add value to the council’s HRA business plan over the 30 years of its life.

3. Return the RTB receipts to central government with interest at base rate + 4%. This option is not recommended as it would not help increase the supply of new homes locally, would not utilise the previously approved capital programme and would not support the long term sustainability of the council’s HRA Business Plan.

4. The council also has the option to seek alternative grant support for development from Homes England, with match funding from the HRA Business Plan. However as RTB receipts have to be used within a specific timescale or be returned and the HRA Business Plan has a limited capacity to provide match funding, this option is only recommended once the available RTB receipts have been fully committed.