Colchester City Council has completed a comprehensive review of its 30-year Housing Revenue Account (HRA) Business Plan, the long-term financial plan that sets out how they will manage, maintain, and invest in council housing. Like other areas of Council spend, the HRA is under increasing strain. The review has tested viability and current pressures, drawing on extensive research, expert independent consultancy, and direct feedback from tenants.
The findings show that while the HRA can remain financially viable, doing so within the rules set by government will impact investment, improvement, and housing growth. Cabinet and the Scrutiny Panel will review the proposals emerging from this work next week, with difficult choices ahead.
The HRA, which is funded primarily through tenants’ rent, is facing rising costs to maintain and improve homes, to meet higher compliance standards. The urgent demand to invest in both existing homes and to deliver new, genuinely affordable housing. At the same time, income into the HRA remains constrained, and has not risen in line with inflation over the years, creating a real challenge for delivery and in balancing investment priorities.
This review is the most in-depth in recent years and has been supported by specialist consultancy Savills, alongside extensive tenant engagement, staff workshops, and data-led analysis. The review reflects both the financial pressures and the lived experience of residents in council homes across the city.
The revised Business Plan will ensure the council continues to meet the government’s Decent Homes Standard, keep its homes safe and ensure all homes meet the required Energy Performance Certificate standard by 2030. However, it contains less investment overall to improve existing homes. The need to balance competing priorities may also see the need at times to deliver short-term repairs instead of longer-term investment or regeneration of older homes - despite the long-term inefficiencies of this approach.
Faced with the national and local housing crisis, the ambition to build new, affordable homes remains high. The city continues to face rising demand for affordable housing, yet the funding model is forcing local authorities to scale back or charge higher “affordable” instead of “social” rents.
The council fully supports the anticipated new Decent Homes Standard and Awaab’s Law, which are essential for improving the safety and quality of homes. But meeting these standards without additional national investment means we face diverting resources to legal compliance and away from other priorities such as broader improvements which could disappoint tenants.
Proposed adjustments to the HRA business plan will focus on a more strategic allocation of capital investments, ensuring that funding is used wisely while maintaining the quality of homes. These changes are designed to balance financial sustainability with the need to increase affordable housing options for current and future tenants, ensuring that every resident benefits from improvements in their homes within the budgets that are available. This comes at a time of acute housing need with 459 households being assisted by the City Council with temporary accommodation at the end of March 2025, an increase of 42% from the previous year.
Cllr Julie Young, Deputy Leader and Portfolio Holder for Housing, said: “This has been a rigorous and transparent piece of work, informed by councillor scrutiny, and review by tenants, staff, and sector experts. The message is clear: we can deliver a viable HRA, at a decent homes' standard, but we need further support from government if we are to improve properties as we would wish and our residents urgently need. We’re joining forces with others across the country to call for a fairer, more sustainable future for council housing.”
Page last reviewed: 1 July 2025