Content

Salford City
Council - Record of Decision (Cabinet)
I, Paul Dennett, City Mayor, in consultation with
the Cabinet and in exercise of the powers contained within the City
Council Constitution do hereby approve:
 
Rent and Service charge Setting
for 2025/26 and future years:
 

1.   
An increase of 4% for rents in 2025/26 for the Pendleton Private
Finance Initiative (PFI) stock
 

2.   
An increase of Retail Price Index excluding Mortgage Interest
(RPIX) +1% with a 4% floor for rents in 2026/27 and future years
for the Pendleton PFI stock
 

3.   
Adjustments to Pendleton Private Finance Initiative (PFI) service
charges in line with the costs of providing those services as detailed in section 3 of
the report
 

4.   
An increase of 2.7% for rents in 2025/26 for the Duchy Caravan
Site, in line with Retail Price Index (RPI)
 

5.   
The implementation of amended service charges to tenants at Duchy
Caravan Site during 2025/26, subject to a detailed further report for decision
by the Statutory Deputy City Mayor and Lead Member for Housing and
Anti-Poverty
 

6.   
£25k per year for 2 years for a PFI Hardship Fund
 

7.   
Subsidy for gas utilities at Lombardy Court of
c£7.4k
The Reasons
are:

·        
The decision to increase rents by the 4% floor and
for future increases to be set at RPIX +1% with a 4% floor in
2026/27 and future years was not taken lightly but was based on
financial modelling that showed that this option ensured the
on-going viability for the Housing Revenue Account. For 75% of
households they will be receiving full or partial HB and UC
support.

·        
The PFI management fee which the council has to pay
is linked to RPIX and bringing future rent increases in line with
RPIX helps to ensure financial viability. A rent freeze was
considered as an option, but resulted in the HRA entering an
unlawful deficit over the life of the HRA Business
Plan.

·        
The viability of the Housing Revenue Account through
to 2043/44 has also had to consider the additional cost
implications associated with the Building Safety Act, Consumer
Standards and contract expiry costs. 
Whilst it is the council’s desire to keep rents as low as
possible, we need to prudently manage the Housing Revenue Account
which can’t legally go into deficit or be cross subsided as
determined by the Local Government & Housing Act 1989.
The rent increase is not funding any of
the current cladding replacement works.

 

·        
Pendleton Together and the Council have reviewed the
current service charges and have proposed revised charges based
upon actual and estimated costs. The cost of services will vary
from block to block depending upon services received. 

·        
A number of mitigations have been put in
place  to ensure residents can maximise
their income and access additional support where
required.  This includes support from a
dedicated Customer Support Officer, access to Together
Housings’ Energy Redress scheme, continuation of winter fuel
payments whilst high rise blocks remain unclad and a £25k per
annum hardship fund ring fenced for PFI
residents.

·        
In January 2023 the City Mayor and his Cabinet
approved a £216,000 hardship fund for the Pendleton PFI
housing stock.  This was established in
recognition of the impact of the cost of living crisis, to support
residents and families in times of crisis.  Since the launch of the fund there have been 521
referrals and 155 successful applications utilising around
£55k. In addition, c£139k has been utilised from this
fund to subsidise a percentage of the increase in energy costs for
communal energy in high rise blocks where they have been adversely
impacted by non-domestic tariffs.

·        
In addition to this direct support
offered to Pendleton PFI residents and families, the council
continues to support all our residents and families across the
 city through our work to tackle poverty, including Household
Support Fund, Salford Assist, Discretionary Housing Payments, the
Council Tax Support Scheme, and partnership working with Salford
Credit Union.  These council services
are also available to Duchy site residents.

 
·        
The proposed 2.7% rental increase for Duchy pitch
fees is in line with the Retail Price Index as set out in the
Mobile Homes Act 1983. Whilst this is the maximum that pitch fees
can increase by, this decision must be taken to ensure the
long-term financial management of the Duchy Caravan Park along with
continued maintenance of the site for the residents who live
there. 
 
Assessment of Risk: Low
The source of funding is: Housing Revenue Account
Legal Advice obtained: The Council is required to set a balanced HRA
budget. 
Financial Advice obtained:
The rents and service charges
proposed within this report would be a significant source of income
for the HRA, in line with the HRA requirements the account cannot
go into a deficit, so the proposals are in line with the
requirements of the account.
 
The rent increase for Duchy
Caravan site is vital to ensure the revenue account doesn’t
drop into a further deficit and create further pressures on the
council’s revenue budget in future years.
Procurement Advice obtained: N/A
HR Advice obtained: N/A
Climate Change Advice obtained:
N/A
The following documents have been used to assist
the decision process: N/A

Contact Officer:  Jane Barlow, Service Manager Contracts / Grace
Rogerson, Senior Accountant
Telephone number: Jane Barlow 0161 793 2372 /
Grace Rogerson 0161 793 2506
(Please delete from the list below any which are
not relevant).

·        
This document records a key decision which was
included in the Council’s Forward Plan

·        
The appropriate scrutiny to call-in the decision is
the Growth and Prosperity Scrutiny Panel     

 

Signed: _____Paul
Dennett_________________ Dated: _30.01.25____________                                                             
              
City Mayor, Paul Dennett
 

For Democratic
Services use only

 

This
decision was published on  
30.01.25                                     

This
decision will come in force at 4.00 p.m. on 06.02.25                   
                              
unless it is called-in in
accordance with the Decision Making Process
Rules.