The committee approved the proposed changes to Lewisham’s Housing Revenue Account for 2025/26. This included an average rent increase of 2.7% for council tenants and an average increase to service charges of £10.98 or 39.9%. Tenants in properties managed by Regenter B3 will see an average increase to their service charges of £0.90. The committee also approved an average increase of 2.7% to garage rents. The Local Government and Social Care Ombudsman’s report into the Council’s handling of a resident's homelessness application was noted. The committee agreed the Cabinet Member for Housing Management and Homelessness should oversee the action plan that has been produced to prevent a reoccurrence of the issues identified in the report.

Housing Retrofit Strategy

The committee considered a draft of the Council’s Housing Retrofit Strategy, which will guide the Council’s work to improve the energy efficiency of homes in Lewisham, thereby helping the Council to achieve its target of becoming carbon neutral by 2030. The draft strategy details the costs of delivering a borough-wide retrofit programme and includes a plan to provide support to all residents, not just those who live in council properties. The costs are estimated at £3.2bn for all homes in Lewisham and £470m for the 19,845 council-owned homes. The draft strategy proposes 38 projects across seven areas:

• Increase fabric and energy efficiency installations
• Roll out low carbon heat
• Increase low carbon power generation and flexibility
• Establish a robust evidence base for action
• Empower residents through consistent and trusted communications and engagement
• Increase supply chain capacity and capability
• Embed equality, diversity and inclusion

These projects are categorised as:

• Core delivery - These include a range of projects supporting and directly delivering housing retrofit projects across the borough building on the Council’s current initiatives and existing funding commitments.
• Stretch - Retrofit projects that can be delivered with existing capacity in the market, but require enabling actions before they can be progressed.
• Innovation - These projects focus on testing innovative solutions, providing valuable learning and building confidence for longer-term scale-up.

The draft strategy sets out that there is only a commitment to deliver the core delivery projects. The other projects will require additional budget and capacity.

The core delivery projects are:

• Delivery of Social Housing Decarbonisation Fund wave 2.1 grant-funded work on the Council’s housing stock, this project will deliver works to 250 homes.
• Continued development of district heating opportunities, in particular the networks being developed in Catford, Lewisham Town Centre and North Lewisham.
• Completion of the stock condition survey work and improvements to data collection and reporting on housing energy performance across the Council’s housing stock.
• Working with Regenter Brockley to improve the collection of energy performance data during stock condition surveys.
• Launch and promotion of the new Housing Retrofit Strategy.
• Support low income and vulnerable residents in privately owned properties to access retrofit funding.
• Promote existing guidance on conservation areas.
• Roll out of licensing across the private rental sector.
• Play an active role in regional and other retrofit activity and in calling for more investment and action on housing retrofit.
• Embed equalities diversity and inclusion principles and practice into the Council’s planning and delivery of retrofit programmes.

Budget Savings 2025/26

The committee reviewed the draft budget reduction proposals identified to date, for both the general fund and the housing revenue account. These initiatives are needed to address:

• The £20m two year budget shortfall set out in the Medium Term Financial Strategy (MTFS) approved by Mayor and Cabinet in July 2024, and
• The forecast overspend in 2024/25, currently reported as £36m.

The agreed approach was to identify savings in 2024/25 and implement them in 2025/26 and 2026/27. It was also agreed that any overspend in 2024/25 would be managed down or commensurate cost reduction measures identified to mitigate the spend.

This has resulted in the identification of £9.617m of cost avoidance and savings proposals for 2024/25, as well as a further £3.435m of base budget reductions and £13.410m of cost avoidance measures for 2025/26 and 2026/27.

However, the cumulative totals of £4.739m of savings and £21.723m of recurring cost avoidance measures fall short of the respective £20m and £36m targets. This will mean that in 2025/26 a further £25.038m of savings will need to be identified and implemented. The Council will also need to use reserves to set the budget in 2025/26.

The committee provided feedback on the following proposals:

• Ending the funding for the Council-run Assembly Programme, resulting in a saving of £203,025. >“The proposal is to cease all funded/ officer supported Assembly functions. This will mean reduction of staffing to deliver the saving. The impact of the reduction will be that there will be no community engagement delivered through this team … although this does not preclude program specific consultation done by other teams or by the councillors themselves (without council support).”

The Committee raised concerns about the lack of any alternative community engagement in place. It was noted that assemblies are a commitment in the Council’s Constitution. A full equalities analysis assessment has been completed for this saving.

• Increase fees and charges applied by Home Ownership Service.

  “Increase the fees charges by home ownership for certain services to provide pre assignment packs, re-mortgage enquiry packs, additional enquires and for copies of leases.”

  • Reduction in employers pension contribution. > “Based on revised analysis the Council’s actuaries have advised that the Council could reduce its current employers pension contribution rate from 22% to 21.5%.”

This will impact both the General Fund and the Housing Revenue Account (HRA) resulting in a saving of £750,000 across both budgets.

• EV Charging Points/ Stations, generating income of £50,000 per year by 2028.

  “Using predictive analytics software, we have projected Lewisham’s on-street demand will amount to over 2,500 charging points by 2030 … This will help support the growth of reliable and accessible EV infrastructure, whilst also providing a potential revenue stream to the HRA. These chargers could generate revenue income from 2025/26 but will require identification of sites, consultation with residents and a full equalities analysis assessment.”

• Streamlining the Building Safety and Stock Investment Teams – saving of £465,300.

  “Roles that are currently vacant to either be removed from the structure or put on hold for FY 24/25.”

• Making scheduled Grounds Maintenance services more environmentally and financially sustainable – saving of £143,000.

  “Reduced GM schedules / staffing … Introducing more ‘no mow’ and restricted mowing areas to reduce the extent on maintenance on fortnightly schedules and consider reduced frequency on some sites. This will make the service more environmentally and financially sustainable.”

• Rationalising scheduled bulk collections – saving of £110,612.

  “To make scheduled collections more efficient by using larger vehicles, pending a further review of the bulk collection service … Rationalising scheduled bulk collections by using larger and fewer vehicles and fewer staff and aspiring towards a 100% appointments-based system.”

Housing Revenue Account (HRA) - Rent Setting

The committee reviewed the proposed HRA rent increase of 2.7% for 2025/26, with an average increase to service charges of £10.98 or 39.9%. This is in addition to the rent increases agreed in 2023/24 and 2024/25 of 7% and 7.7% respectively.

The current Rent Policy permits Registered Providers to increase rents by a maximum of CPI + 1%. The CPI figure is taken from the nationally published CPI figure each September. The CPI figure for September 2024 was 1.7%. The Council recognises the fact that tenants still face high living costs, however the Council will need to apply the maximum allowable increase to be able to afford to continue to deliver services to residents, maintain and invest in the housing stock and make sure that the Housing Revenue Account is sustainable in the medium and long term.

The committee discussed how the Housing Revenue Account (HRA) faces significant challenges in meeting its obligations. This is partly due to the imposition of recent rent caps/reductions which has severely impacted on the Council’s ability to maintain decent homes, invest in its existing stock, meet building safety and new regulatory requirements, and continue building new social homes. In addition, debt interest charges will also increase based on the need to borrow for HRA investment needs and the increase in interest rates applied to debt.

The committee reviewed the feedback from the two resident engagement meetings:

• Lewisham Council Housing Services – Rent & Service Charge Proposals – Tenant Feedback Meeting on Tuesday 29 October 2024
• Tenant Rent & Service Charge Residents Meeting on Wednesday 30 October 2024

The two main themes from these meetings were:

• Concerns about the proposed rent and service charge increases.
• Concerns about the quality of existing services, in particular the repairs and caretaking service.

The resident feedback will be included in the report to Mayor and Cabinet.

Local Government and Social Care Ombudsman Report

The committee noted the Local Government and Social Care Ombudsman’s (LGSCO) report ¹ which found the Council to be at fault in its handling of Ms X’s homelessness application.

The report identified failures in a number of areas:

• Processing the homelessness application and developing the personal housing plan
• Providing interim accommodation and suitable temporary accommodation.
• Carrying out repairs to temporary accommodation
• How the housing register application was banded.
• Delays completing the medical assessment.
• Complaints handling processes, and
• Adherence to the Equality Act and Human Rights Act.

“The LGSCO investigated this complaint by speaking to Ms X and examining relevant documentation … They found the Council was at fault in a number of areas. These relate to processing the homelessness application and developing the personal housing plan, providing interim accommodation and suitable temporary accommodation, as well as carrying out repairs to temporary accommodation. There were also faults raised around how the housing register application was banded, delays completing the medical assessment, complaints handling processes, as well as adherence to the Equality Act and Human Rights Act.”

The LGSCO has made a number of recommendations, all of which have been accepted. An apology has been issued to Ms X and she has received compensation of £14,150.

“The Council has accepted the report recommendations. An apology letter was issued, and payment of compensation has been made.”

An action plan has been produced, which the committee agreed should be overseen by the Cabinet Member for Housing Management and Homelessness.

“A detailed summary of the faults identified in the case has been produced, and the actions to prevent recurrence have been identified. This information has been shared at management meetings, and with Team Leaders for discussion with officers at team meetings and within 121s.”

Select Committee Work Programme

The committee reviewed its work programme. The following items are scheduled for the next meeting:

• Resident Engagement Strategy
• Temporary Accommodation - Supply and Pressures
• Stock Condition Survey

The committee will also be receiving the following information items:

• Rent Standard Compliance review
• Future of UK Council Housing (report launch in Parliament)
• Housing IT briefing

The committee will undertake a training session on the Building Safety Regulations.

The committee discussed its site visit to Lambeth to see retrofitted street properties. Lambeth received funding through the SHDF wave 1 scheme and retrofitted several streets of properties. The Committee considered this visit valuable, as it highlighted the key opportunities and challenges involved in delivering retrofit.