Why are there no surplus or deficits?

• Fire Risk Assessment and Safety Inspection charges are funded through a Reserve Fund, which spreads costs over several years. This means that the amount charged in 2025/26 may not have been spent in that year. Consequently, the difference between the estimated and actual charges will not equal the annual deficit or surplus, as these costs are managed through the Reserve Fund.
• 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. 
• We have procured a specialist fire risk assessment company to deliver our ongoing programme of fire risk assessments as required by fire safety legislation.
• We get these done as often as our specialist or regulations require.
• Fire safety requirements have recently changed, so we are now directly managing this specialism, instead of it being through a larger repairs and maintenance contract. Our investment demand for this has been adjusted accordingly.

Why were costs lower?

• The setting of service charge estimates for gas, and electricity is very difficult as the worldwide energy market is so turbulent at the moment. We reprocured our energy contract from 1 October 2024, staying with LASER as the provider of a 5-year contract. 

Why were costs higher?

• The overspend this year is primarily a result of external market forces; the 2025/26 financial year saw unprecedented, historic tariff increases across the UK water sector. While consumption remained relatively stable, the sharply increased cost per cubic metre charged by the utility provider resulted in a deficit.

Why were costs lower?

• The setting of service charge estimates for gas, and electricity is very difficult as the worldwide energy market is so turbulent at the moment. We reprocured our energy contract from 1 October 2024, staying with LASER as the provider of a 5-year contract.

• 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 (CCC), with renewal taking place on 1 October each year.
• For annual renewal from 1 October 2025, Aspen Insurance required higher “sum insured” value 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, the majority of leaseholders have experienced premium increases.

An itemised breakdown of the repair charges specific to your block are available upon request. Please email your Homeownership Officer  home.ownership@milton-keynes.gov.uk. 

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 £1.04 this year.