Housing Revenue Account (HRA) Business Plan 2025 to 2055

1.1 The Housing Revenue Account (HRA) is the financial account used to manage the council's activities as a landlord. It is a ring-fenced account and can only be used to provide services to council housing tenants through the collection of rent and other service charges.

1.2 The HRA Business Plan is a key strategic document which sets out the council's income and expenditure plans for delivering Council Housing Services in Gateshead.

1.3 This refresh of the plan is set against a backdrop of an extremely challenging financial situation. Increased pressures arising from new regulatory requirements, prioritisation of the decarbonisation of social housing and the expectation of more new development from councils.

1.4 In this context, in September 2024, over 100 local authorities, including Gateshead Council, joined together to publish the Securing the Future of Council Housing report calling for urgent action to bring council housing budgets back from the brink and enable them to deliver new and better homes.

1.5 As this is a 30-year plan, assumptions become more uncertain with each year of the plan. The primary risks are in relation to future inflation and interest rates, however, the most up-to-date forecast information has been used in the preparation of the plan.

1.6 Overall, the revised HRA Business Plan is a fully costed, sustainable plan and does not breach the minimum £3 million reserve balance during the life of the plan (30 years).

1.7 Whilst the borrowing is affordable within this plan, debt needs to be managed in the overall context of affordability for the council. The risks associated with borrowing will therefore need to be kept under review.

1.8 However, to accommodate the stock investments and associated cost implications, based on current assumptions, borrowing would increase by £115.539 million to £461.044 million by year 30. Additional borrowing will start to accrue in year two of the plan.

1.9 This plan should be read in conjunction with the other key housing strategies and policies which set out how the above ambition can be achieved.