Lack of clarity over council cash

Following the Horsham District Council press releases on the financial situation and the debate planned for the council meeting on October 24, I took an interest and decided to attend. In preparation I read the agenda and supporting papers on the first day that they were available, ie one week before the meeting.

I had some concerns relating to the ‘New Homes Bonus’ (NHB) which started up in 2011-12 and is a government grant to incentivise housing development. The NHB is replacing an increasingly significant amount of ‘Formula Grant’, which is the main pot of money that HDC receives each year from central government to help pay for our local district services.

The issue was that in the revenue projections beyond 2013-14 it was stated that ‘potential NHB relating to houses not yet delivered are not included’. I could not understand this as it implied that no account of homes due to be completed from October 2012, was being made. I immediately raised this point expecting to get a quick answer before the planned debate, a week later.

Unfortunately HDC chose to deal with my query as a Freedom of Information (FoI) request, which I immediately (and unsuccessfully) challenged as I knew it meant that I would (almost certainly) not get an answer before the debate.

I therefore registered to make a two minute public statement on this point at said meeting, in the hope that it would then be clarified, ie surely the housing stock will continue to increase and so to ignore that fact seems unreal and overly pessimistic. Just take a look at the West of Horsham housing developments; are they not building houses? The director of corporate resources however presented the report indicating that houses not yet delivered should not be counted as HDC could have no control over developer schedules. My point seemed destined to be disregarded.

But then, at the very, very end of the meeting a council member for Holbrook East alluded to the fact that an NHB allowance had indeed been made for such housing but in reserves, not revenue. The meeting promptly closed and after the meeting this point was informally confirmed in some brief Q&A exchanges!

Following a reminder, I have just (16:45 Monday October 29) received the written FoI reply confirming that HDC has indeed assumed the housing stock will increase from October 2012 but has earmarked the potential NHB money (my estimate, £1m) to bolster reserves.

What a palaver!Why didn’t they say so at the outset and then the concern would have just been about whether this should correctly be allocated to the reserves or to the revenue account. Why could they not have responded in advance of the report being debated?

Hmmmnh… so how come they can now project a reserve figure based on housing developments over which they just said they have no control?

Never mind. I am not put off by this apparent lack of clarity, openness and transparency. I will be reading the next report on this subject with even more interest!

Maybe I will then be able to understand why in its first five years of payment, HDC plans to put almost 40 per cent (£2.15m) of all NHB received into reserves and at the same time declare a severe revenue shortfall. Maybe that is a direct consequence?

The Government housing minister said of the New Homes Bonus ‘It’s why communities that continue to welcome new homes can expect to see bigger cash bonuses and improved local services in the future’.

But, will residents of Horsham district just experience dwindling services as 40 per cent of this money is diverted into reserves?

We do live in difficult times but please just give us the facts straight. We are then more likely to support the tough financial decisions that are undoubtedly ahead of us.


Cox Green, Rudgwick