The project will identify the best way to ensure resources are in place for the on going investment in the housing stock to keep it up to an acceptable condition.

It will also examine the standard of services that residents want to receive in the future.

The end result will be a recommendation to Cabinet and to the Full Council on the best way forward for the future. The Full Council is where all Poole's Councillors meet to decide on important strategic decisions.

Why has the Council set up this project? I thought PHP had '3-stars'!

Even though PHP has achieved the highest possible rating of "3-star excellent with excellent prospects", we have to look to the long-term future. Providing excellent management does not address the question of on going capital resources to invest in the housing stock.

The Council still owns the housing stock, and PHP manages and maintains it on behalf of the Council, and so it is a Council decision how best to ensure on going investment.

Why can't PHP just continue to manage and maintain the homes?

PHP could continue. However, financial forecasts show that the Council will not have enough money to invest in improvement contracts to the housing in the future to keep it up to an acceptable standard.

We may not have the resources to make sure services continue to improve in the future, and keep pace with rising demand. For example, with longer life expectancy meaning far more older people, there will be new and significant challenges which will cost money.

By 2010, many of the homes will have been modernised, but there will still be many that won't because they were not due to be done. However, after 2010, these homes will become due for modernisation.

Why will the Council and PHP not have enough money? I thought PHP were 'excellent'!

Since 2004-5, the Council, via PHP, has been able to spend an extra £35m until 2010 on improvements to people's homes.

Central government allowed the Council to borrow this additional money as a result of PHP achieving 3-stars in 2004.

What is the first step?

The first step is to establish what people want the housing service to look like in the future, for example, what are the standards we want to achieve in the future? What are people's priorities and hopes?

What are the likely options?

We need to research this but the most obvious options at the moment are:

· · PHP continues in some way with a different funding arrangement

· · Examine the possibility of a Private Finance Initiative (PFI)

· · Change PHP into a Housing Association to take ownership of the Council's housing stock

· · Transfer the ownership of the stock to an existing Housing Association

· · Transfer the management and maintenance of the stock back to the Council

We also need to examine whether there are other options we could look at.

Has a decision already been made?

No; it could not possibly have been. This is because the exact costs of future investment, along with future Government policy on funding housing needs to be established before a decision can be made.

This project is a full and meaningful consultation and we want to find out from residents, and also from staff, views on the best way forward.

How will the decision be made?

A 'Working Party' has been set up and will make a recommendation to Cabinet (lead Councillors) on the preferred option. They will then refer their recommendation to the Full Council.

If Cabinet/Council agrees the recommendation there will be a further consultation with all residents on that option before the final decision is made.

The Working Party comprises:

· · 5 Councillors (3 Conservatives, 2 Liberal Democrats)

· · PHP's Chair of the Board of Directors

· · 5 resident representatives

When will the decision be made?

The first stage is find out the views of the aspirations and priorities of residents and the type of housing service they would like to see in place.

At the same time we will be analysing up to date information on the finances and condition of the stock.

This process is expected to take from January 2009 until about April 2009.

We will then consult all residents and other interested people about how we might be able to meet the aspirations and priorities of residents, and consult on the various different approaches.

We expect this to take about three months between June and August/September 2009

The Working Party plans to come to a decision in the Autumn of 2009.

If they recommend a significant change to how the service currently works, the Council and PHP will then consult EVERY tenant and leaseholder on the plans.

How can I get involved?

Anyone can attend the Working Party meetings to observe

Everyone can access information on PHP's website.

The Residents Panel will meet for the first time on 10^th December.

Its membership will regularly feedback and involve the many tenant and leaseholder groups and local representatives that exist across the Borough.

Depending on your interests there will be different, tailored events and newsletters to enable everyone to give their views and learn about the project.

PHP STAFF

Staff are formally represented on the Working Party and Unison is currently seeking a Staff Rep to take on a formal role too.

Staff will be updated at every staff meeting. For more information, please contact Sue Phillips.

Why is the position so difficult?

The position is difficult because there is a shortfall in the amount of money needed to spend on major works to maintain the Council's housing stock. This is not unique to Poole but is likely to be a problem that many Councils have to grapple with in the future.

However, there might be ways to reduce the shortfall or solve the problem.

Isn't it obvious that ALL residents want homes that are nice and well maintained?

Yes, but we need to know other things as well. For example:

· · Would it be acceptable to save money by reducing management standards?

· · What are the maintenance standards that tenants would like, or are prepared to accept?

· · Would residents be willing to pay a little more, by way of a service charge, for higher quality services?

· · How important to residents is the identity of their landlord?

· · What do people want in terms of their neighbourhoods and environment?

· · What services do residents value and want to see put in place?

· · What type of services will future residents want to receive?

· · What housing needs are we going to have to meet in the future?

· · Would it be acceptable to sell off a small number of homes to achieve higher standards in the remaining ones?

Why are we considering a transfer of ownership at all?

The transfer of ownership is only one of the many options that will be considered.

The Council does need to be able to explain how it will fund the long-term management and maintenance requirements for its housing stock.

Why can't this level of investment continue? I thought PHP had 3-stars!

Despite the 3-star 'excellent' rating, the level of investment cannot continue.

Central government allowed the Council to borrow more money in recent years to achieve the 'decent homes standard' by 2010.

The picture changes in 2010 because the ability to borrow more money ends.

By 2010, the 'decent homes standard' will have been achieved, but after 2010 no additional funds will be made available, and it will not be possible to keep the housing stock at that standard.

Doesn't rental income provide the Council with enough money to keep the housing stock in good condition?

The Council is not allowed to keep all the rental income. If it was allowed to keep it all, it probably would be enough.

This year approximately £3.6 million is paid back to Central Government in what the Government call a "negative subsidy". That's about 25p of every £1 of rent we receive in rent income, and this is likely to increase every year. We think next year it will be over £4 Million.

Where do we go from here?

This project is called 'options appraisal' because the project will examine all the different ways to address the situation and find a solution that suits the residents of Poole and the Council.

How will the Working Party decide?

The Working Party will explore all options in detail.

Members will meet and consider specialist advice, and commission and review detailed reports from a team of senior officers from both the Council and PHP (the Officer Support Team).

The Working Party will also receive contributions and feedback from the Residents Panel to make sure the needs and aspirations of tenants and leaseholders are at the core of the process

The Residents Panel will also have its own Specialist Resident Advisor (SRA).

Staff will have representation at the Working Party meetings to ensure staff are given a strong voice in the process.

There are comprehensive terms of reference for the Working Party and Residents Panel, and clear strategies on Communication and Resident Empowerment.

The Working Party meetings are open to the public, and everyone has access to documentation.

What happens next?

After we have found out people's priorities for the future we will discuss with residents, Councillors and other interested parties which option will be the best one for Poole.

How much money are we short?

Our financial predictions show that the basic housing revenue account begins to show a loss in future years. This loss increases over time.

However, there is a forecast significant shortfall from 2011/12 in the amount of money needed to be spent on major works on the housing stock such as Decent Homes investment, tower block refurbishment, roof replacement and much more. This is all contained in the Stock Condition Database.

What is the 'Management Fee'?

This is the sum of money from the HRA that is given to PHP to cover the cost of the services that PHP provides.

What is the Housing Revenue Account (HRA)?

The HRA is the income and expenditure account for managing and maintaining the housing stock.

EXPENDITURE items include:

· · staff costs

· · repairs

· · communications

· · interest payments on loans

· · office costs

· · contracts (e.g. cleaning and grounds maintenance)

INCOME is the income from:

· · rents service charges

· · any interest payments received on money in the bank.

The HRA is a Council account that PHP manage on the Council's behalf.

The account is 'ring-fenced'. This means the Council cannot use HRA money to spend on other Council services. Likewise, it uses Council Tax money to spend on housing services.

Is 'HRA Income' basically the rent paid by residents?

Yes. It also includes the housing benefit PHP receive for some tenants.

Is all HRA income paid to PHP?

No. It's a little more complicated than that.

PHP does provide all the direct housing management services, but certain costs are charged directly to the account BEFORE the balance is paid over to PHP.

An example would be the interest of the HRA debt, insurance costs and the amount paid over to the Government.

What does Central Government do with the money the Council pays back?

The idea is that Central Government redistributes the money to those councils across the UK in more need.

Central Government regards council housing as a national asset and has designed the housing finance system to make sure that additional funding goes to councils in higher cost areas, and councils with high levels of housing debt.

How is the shortfall in the Housing Revenue Account estimated?

We have assumed management and maintenance costs remain at current levels, included interest repayments, and estimated the rental income in line with current government policy on rent levels. This is calculated through the 30 Year Housing Revenue Account (HRA) Business Plan.

How is the shortfall in the capital investment programme estimated?

We have estimated how much money we need to keep the homes up to the 'decent homes' standard over the next 30 years and then calculated how much we will be allowed to spend over that period. We have also looked at the cost of keeping the homes up to the higher "Poole Standard"

We have assumed the Council's current policy of using income from 'Right to Buy' sales to fund General Fund objectives including new affordable housing will continue.

You have used the 'decent homes standard' to estimate how much money we need. Is that a high standard?

PHP has been improving homes up to our own 'Poole Standard', which is a higher standard than the 'decent homes' one. The Poole Standard was negotiated with residents and it seeks to make better use of very tight financial resources by doing quality work that lasts longer than lower quality work. This means happier tenants, it also reduces responsive repair costs and it makes the improvements last longer. So it provides better value for money and better customer care; a "win-win".

What is the difference between the 'decent homes standard' and the 'Poole standard'?

We have installed high quality bathroom and kitchen fittings and have tried to tackle all the defects in properties rather than just enough to reach the decent homes standard. Tenants get a good choice of colours, and are able to design their own kitchen to their own needs.

Print this page