Why were costs higher?

• We spent more than we have estimated due to underestimating the regular costs of fire alarm servicing.
• We also saw a higher number of calls for repairs to emergency lighting and door entry systems where intercoms had developed a fault and where communal doors had stopped working. Unfortunately our contractors found that some of the causes were called by damage and misuse of the systems and doors.
• New lighting systems were installed during the year in response to recommendations in Fire Risk Assessment reports, resulting in a higher number of service visits.
• Overall, the number of callouts for repairs was greater than estimated, with increased costs partly due to national rises in labour and material prices.
• Generally call out for repairs throughout the year were higher than we had estimated, with costs being higher due to the national increase in labour and materials.

Why were costs higher?

• This equipment is usually found in our schemes for the elderly and our modular scheme used for temporary accommodation. We estimate that equipment may need one repair a year, but this year we have seen a considerable increase in call outs resulting in a higher spend.
• Possible reasons for the increased repairs include equipment misuse, ageing machinery nearing the end of its lifespan, and users lacking knowledge on proper operation.
• A small number of new machines were installed during the year, with costs covered by the sinking fund for white goods and laundry equipment. 

Costs as estimated.

• The alarm service forms part of our Community Alarm Service.
• Charges are currently set within the council’s corporate fees and charges, and for 2024-25 these are a fixed charge, meaning there was no surplus or deficit.  
• Tenants will be consulted by colleagues in Adult Services in 2026 regarding the replacement of existing equipment in their homes. 

Why were costs lower?

• We are confident that all necessary servicing works were completed during the year.
• However, we have been unable to clearly identify all operating costs for the year, as costs for other council works were also included.
• Given this is the first year of producing actual service charge information for tenants and leaseholders, we have chosen to recover only the costs that can be clearly identified.
• As part of our ongoing improvement efforts, we have now separated all housing works from those of other departments.
• This means we can now clearly identify the costs to be recovered from service charges in this and future years.

Why were costs lower?

• We spent less money this year because we did not do as many Legionella Risk Assessments as planned. This happened because it took longer to procure a new contractor, as the main focus was on setting up the new repairs and maintenance contract.
• Overall, as your landlord we did spend more than we had estimated as a couple of sites needed scheme wide remedial works to improve water quality. Costs were in excess of £50,000 so in these cases we have not recharged the cost within service charges.

Why were costs higher?

• Your safety and that of your home is a paramount importance to us, which is why we use the services of external specialist advisors to guide us on how as a landlord we are always compliant with the latest rules and regulations. The costs of these advisors is not part of your service charges.
• Changes to how Fire Risk Assessments (FRA) are completed and which buildings now require them came into operation over the past 24 months.  As a general rule, previously we only needed to have a FRA completed to buildings that had any “communal parts” so things like staircases and hallways.
• The latest guidance and regulations, now require us to complete a FRA to ALL Buildings regardless of whether any communal areas exist.  The logic for this requirements seems to be based around “what might happen to a building is a catastrophic event occurred, for example an explosion”.
• Service charges for this expenditure item are collected and held in a Reserve Fund. This allows us to collect service charges from you over a number of years and then, meet the cost of any FRA and other safety inspections when they are completed.
• This allows us to level out service charges each year, rather than you seeing service charges rising and falling each year based on which surveys and inspections have been completed in that year.
• This year we spent £24,000 more than we had estimated. This was because we had not included the cost of asbestos surveys and fire door inspections in our original estimates.
• Our Housing Maintenance Team has recently procured a new contractor to complete Fire Risk Assessments for us and the plan is for every building to have one of the new style inspections over the next 2-3 years.
• Once an inspection is completed the contractors report will tell us several things, one of which will be the frequency of future inspections.  The table below gives you an example of what these might be:-

• In setting future years service charges, we now have “Year 1 - 2024-2025” actual expenditure and we  know what we will collect this year 2025-2026.  We will set future years estimates to try and level out contributions to the reserve fund.  For those buildings that do not require any future inspections, we will look to “wind up” the reserve fund from 2027-2028 wherever possible.

Why were costs lower?

• Our estimate for the year was accurate to what we actually spent on lift servicing and maintenance. The difference was due to us not being able to clearly establish our spend on annual mechanical inspections which is managed and arranged by a third party on behalf of the council.
• We are making arrangements for these costs to be clearly identified from now on so they can be included in future service charge calculations.

Why were cost higher?

• This is the cost of checking and maintaining equipment to keep workers working at high levels safe.

Why were costs lower?

• Our estimate for this year was based on sites which have a communal TV aerial system having 3 routine call outs per year, at an estimated cost of £72.77 each.
• We are pleased to see that we did not see this level of call outs and therefore most sites will see a surplus, as we have spent less than we collected.
• For our estimates for this current year (2025-2026), the number of call outs was reduced from 3 per year to 2 per year per site.

Why were costs higher?

• A small number of buildings are fitting with Automatic Opening Vents (AOV’s). These are like windows that are connected to the buildings fire alarm and when this is set off the AOV’s open and allow any smoke to be let out of the vent, therefore keeping escape route free of smoke.
• Servicing of AOV’s is completed twice a year.

Why were costs lower?

• Only three sites have CCTV systems installed.  There are no annual subscription costs, so our expenditure is purely on repairs and call out costs.

SFD03  Sinking Fund - Door Entry & PAC Systems

Total contribution to funds £84,592 

SFD04  Sinking Fund - Fire Alarm Systems

Total contribution to funds £5,344

SFD05  Sinking Fund - Emergency Lighting

Total contribution to funds £24,077

SFD08  Sinking Fund - Furnishings in Common Areas

Total contribution to funds £27,803

SFD09  Sinking Fund - Passenger Lifts

Total contribution to funds £60,899

SFD10  Sinking Fund - Barriers, Gates & Boundaries

We do not currently collect any contributions for this type of work. However, during our work to identify costs of works across the housing stock, we are aware that tenants and leaseholders have asked us to improve / complete works to gates and fencing where they live.

SFD11  Sinking Fund - Warden Call Alarm Equipment

Total contribution to funds £ 52,320

SFD12  Sinking Fund - Security & CCTV Equipment

Total contribution to funds £7,325

SFD13  Sinking Fund - Water Tanks & Filtration Equipment

Total contribution to funds £3,368

SFD14  Sinking Fund - White Goods & Laundry Equipment

Total contribution to funds £2,7334

We spent £14,479 on new equipment.

SFD15  Sinking Fund - Fire Fighting Equipment

Total contribution to funds £2,512

SFD19  Sinking Fund - Television Systems

Total contribution to funds £2,1146

We spent £ 25,691 on the installation of new aerial systems.

Why were costs lower?

• The setting of service charge estimates for gas and electricity is very difficult as the world wide energy market is so turbulent at the moment.  In addition to market trends, we knew that we would be reprocuring our energy contracts across the council and this was therefore a second unknown factor.
• When setting our estimates for 2024-2025, we already knew the annual consumption for each site and decided to keep the cost for kWh the same.  At the time unit rates were between 25p and 28p for kilowatt hour.  We did increase standing charges by 10% as the market had indicated that network costs would rise at some point during the year.
• We reprocured our energy contract from 1 October 2024, staying with LASER as the provider.  We were delighted to see that unit costs had reduced to between 18p and 21p per kWh.
• As a result, our spend on electricity this year was down by £193,000.
• Our supplies are now tidied in with this new contract for the next 5 years.

Why were costs higher?

• Our estimated charges for 2024-2025 were too low, resulting in most sites now facing a deficit.
• Although we accounted for higher standing charges and water costs, the actual increases exceeded our projections.
• For 2026-2027, we will review each account with the supplier and ensure metered sites have updated usage data.

Why were costs lower?

• Only a handful of schemes have common rooms with televisions present.
• In setting the charges for 2024-2025, we received information from the Motion Picture Licence Company regarding which schemes needed both a TV licence and a MPLC licence.
• This was subsequently changed, meaning that some schemes did not require a MPLC, which reduced the cost.

Why were costs lower?

• The garden maintenance service is currently only provided at our 25 schemes for older people and our modular scheme.
• Works are completed by Glendale, the grounds maintenance contractor, working as part of the SUEZ environmental contract across Milton Keynes.
• During the year, Graham, our new Housing Landscape Officer, consulted residents at each scheme about the gardening service they wished to receive; the good news was that they were happy with the current service, so very few changes were needed.
• Our spend for the year was slightly less than estimated, as some works were unnecessary due to the dry summer weather and parts of the new contract commencing later than anticipated. 

• We operate two communal cleaning services.  Our 25 schemes for older people have cleaning completed by an external contractor called Churchill Contract Services Ltd.
• General needs buildings are cleaned by our inhouse cleaning service which is part of our Housing Neighbourhoods Team.  This inhouse team was subject to consultation within the rents and service charge consultation between 2023 and 2024.
• The deficit of £88,708 for the year is mainly due to increases in salary, national insurance and pension costs for staff, as the team successfully managed to recruit to vacant posts from previous years.
• Our Housing Neighbourhoods Team are also currently consulting with tenants on leaseholders about the future of this service and current service standards.

This service is currently only provided to shared ownership bungalows in Dexter Avenue.

• This service is currently only provided to our modular homes.
• We have recently asked tenants and leaseholders if they would be interested in us arranging a new window cleaning service at blocks of flats and maisonettes, so we can keep windows and surrounds clean.  Responses are still being collated.

Why were costs lower?

• This is the cost of hiring large wheelie bins at blocks where standard dustbins are not available.
• Some good news for some residents is that some charges this year have ceased under new contract arrangements.

Why were costs lower?

• The caretaking service is provided by our inhouse team working in our Housing Neighbourhoods Team.
• This team are currently consulting tenants and leaseholders on service standard and the delivery of the service in the future.

Why were costs lower?

• The setting of service charge estimates for gas continues to be very difficult as the world wide energy market is so turbulent at the moment.
• In addition to market trends, we knew that we would be reprocuring our energy contracts across the council and this was therefore a second unknown factor.
• When setting our estimates for 2024-2025, we already knew the annual consumption for each site and decided to keep the cost for kWh the same.  At the time most supplies had a unit rate of only 7.4160p per kilowatt hour.
• We did increase standing charges by 10% as the market had indicated that network costs would rise at some point during the year.
• We were very happy to see that we would continue with our current energy supplier of LASER for the next 5 years.

There are 28 sites where we as the landlord pay the water and sewerage charges as there is only one metered supply for the building and then the cost of these charges are recharged back to residents as this service charge.

How do we split the charges?

As a reminder to residents we agreed a mechanism during the rents and service charge consultation on how these costs are split at property level.  Below is what we agreed.

An example of the calculation is shown below.  The block contains 12 flats, 4 are bedsits, 4 are 1 bedroom and 4 are 2 bedroom flats.

The annual estimate of costs for this block is £1850.00

Flat 1 would therefore pay £1850 / 15 x 1.00 = £370.00 / 52 weeks = £7.12 per week.

Flat 12 would therefore pay £1850 / 15 x 1.50 = £555.00 / 52 weeks = £10.67 per week.

• This service charge only applies to the 70 modular properties we have that are used as temporary accommodation and are let as furnished units.

• These charges relate to 45 flats that we purchased during the Covid 19 pandemic, where we are a leaseholder and not the freeholder of a block of flats. This means that another landlord sets the service charges for the building and is responsible repairs and maintenance.
• To set these charges we simply remove any repairs and insurance costs as these are areas met by a tenants rent and recharge the entire annual sum as one service charge.
• Of 45 flats, 12 tenants pay social rent plus service charges, while 33 pay an all-inclusive affordable rent. For most tenants, any changes to service charges are addressed during the annual rent review when affordable rents are adjusted.

We no longer have any properties paying this service charge.

Why were costs lower?

• The setting of service charge estimates for electricity is very difficult as the world wide energy market is so turbulent at the moment.  In addition to market trends, we knew that we would be reprocuring our energy contracts across the council and this was therefore a second unknown factor.
• When setting our estimates for 2024-2025, we already knew the annual consumption for each site and decided to keep the cost for kWh the same.  At the time unit rates were between 25p and 28p for kilowatt hour. We did increase standing charges by 10% as the market had indicated that network costs would rise at some point during the year.
• We reprocured our energy contract from 1 October 2024, staying with LASER as the provider.  We were delighted to see that unit costs had reduced to between 18p and 21p per kWh.
• This is why we spent £93,372 less than we expected in the year.

Why is this £0?

• This service is provided to 799 tenants living across 25 schemes for older people.
• Charges are currently set within the councils corporate fees and charges, and for 2024-25 these are a fixed charge, meaning there was no surplus or deficit.
• Tenants have recently been consulted on the future of this service and from 1 September 2025 a new service aligned towards an Intensive Housing Management service has been put into operation.

• In 2024-2025 this service was only provided to our 70 modular homes used as temporary accommodation.
• IHM is generally seen as being where everyday housing management functions are provided to tenants but on a more frequent and with greater intensity to allow the viability of the tenancy to be retained. It can included completing repairs quicker and helping tenants best use communal services and to act as a liaison to other services and providers.
• For our temporary accommodation part of this work is assisting tenants to move on to permanent housing that meets their needs and to run the building to ensure that properties are turned around quickly and efficiently, not leaving them unoccupied for extended periods of time.

• Service charges have an administration fee which is based on eligible charges that attract a 10% admin fee and ineligible charges, like water and heating and supported housing officer services that attract a 5% fee.
• At the start of each year whilst preparing our estimated service charges we look at our operating costs, such as salaries, national insurance and pension costs, together with operating costs like offices, IT equipment and services we need to run the business, like legal services and those provided by external companies, like the provider of our housing computer system.
• As a landlord our aim is to have operating costs, which are directly linked to the administration of service charges covered by these administration fees.
• For 2024-2025 what we collected in estimated administration fees was slightly less than our costs, but only by £27,000. Administration charges based on actual costs for 2024-2025 where generally in line with our costs.
• This means as a landlord we can continue to set administration fees at 10% and 5% as agreed with tenants during the rents and service charge consultation and do not need to consider increasing these fees at this time.

• 180 leasehold properties have a ground rent charge of £10 a year.  This is collected within the annual service charge instead of being demanded separately as we agreed with leaseholders during the rent and service charge consultation that the administration costs of collecting such a small amount could be reduced.

Why were costs higher?

• Our insurance policies are arranged by Cambridgeshire County Council (Cambridge CC), with renewal taking place on 1 October each year.
• Current buildings and terrorism cover are provided by Aspen Insurance under a Qualifying Long Term Agreement, which began on 1 October 2022 and runs for three years, with options for a further two years. 2024-2025 is year three of the contract.
• When setting estimated premiums for 2024-2025, Cambridge CC advised that insurance premiums across the market were rising above inflation, prompting a 20% uplift on current premiums.
• For annual renewal from 1 October 2024, Aspen Insurance required higher “sum insured” values to reflect increased building material and labour costs. The premium per £1 of sum insured value also rose significantly above inflation, largely due to more claims resulting from adverse weather, especially flooding.
• Consequently, all leaseholders have experienced premium increases, averaging approximately £38 per year.

This new charge was introduced to help leaseholders make an estimated contribution to the cost of repairs completed to the block that they live in.  We agreed with leaseholders to set up a series of repairs bands, details of which are shown below:-

This year our estimate of repairs spending overall was within £7092 which is very good.  However it is noted that some blocks may have higher spending than expected and others lower spending.

Across the portfolio of almost 1700 leaseholders the average surplus was £3.09 for the year.

Why were costs lower?

• This is our estimated cost of managing leasehold properties and the allocated costs of administering service charges for leasehold properties.
• Our estimate was very close to the actual cost, giving each leaseholder a surplus of £5.63 this year.