Agenda item

(a)  That the accounting treatment of the excess capital receipt arising from the disposal of the Akzo Nobel site in 2022 as outlined in paragraphs 2.14 to 2.16 of the report be noted.

(b)  That the principle set out in regard to the accounting treatment to be applied for any HRA disposals, should those circumstances apply, as outlined in paragraph 2.17 of this report be agreed.

(c)  That it be agreed that confirmation be provided to Full Council annually, when setting the HRA budget, that the criteria outlined in paragraph 2.10 of the report had been met.

The Cabinet received a report which set out the accounting treatment of the capital receipt arising from the disposal of the former Akzo Nobel site at Wexham Road.

The site was initially purchased in 2021 for the Housing Revenue Account (HRA) was funded by a mixture of borrowing and reserves.  It was acquired as part of the Council’s then plans to re-develop the site for a mixture of commercial and residential development.  In November 2022 the Cabinet determined to dispose of the site generating a significant excess capital receipt.  A key rationale for its disposal was to contribute towards the reduction in the Council’s future financial commitments, generating disposal receipts and reducing the Council’s borrowing and Minimum Revenue Provision (MRP).  The report sought approval to an accounting treatment of the receipt that maximised this key objective.

Officers summarised the proposed approach by which the Capital Receipts Reserve available in the HRA could be partially applied to the General Fund to reduce the costs of borrowing and associated MRP, utilising the principle of no detriment to the HRA in line with relevant Governance guidance. The recommended approach was key to reducing the costs of MRP and delivering financial sustainability for the Council.

After due consideration, the Cabinet endorsed the recommendations set out in the report.

Resolved –

(a)  That the accounting treatment of the excess capital receipt arising from the disposal of the Akzo Nobel site in 2022 as outlined in paragraphs 2.14 to 2.16 of the report be noted.

(b)  That the principle set out in regard to the accounting treatment to be applied for any HRA disposals, should those circumstances apply, as outlined in paragraph 2.17 of the report be agreed.

(c)  That it be agreed that confirmation be provided to Full Council annually, when setting the HRA budget, that the criteria outlined in paragraph 2.10 of the report had been met.