Reserves

Allowances

Allowances are a key part of the expenditure assumptions when calculating Housing Association Grants (HAG). They are designed to ensure that Associations are able to manage and maintain housing in line with required standards.

When calculating the level of Reserves required, Associations should use the figures available from the Department in relation to the major repairs allowance detailed below.

These indicative allowances are for general needs housing and are based on similar allowances in other parts of the UK.

Major Repairs Allowances (Currently Under Review)

Major repairs provisions are required to meet the anticipated cost of future major repairs and renewals over the lifespan of the property. Provisions should be made annually as follows:

New Build / Off the Shelf

0.8% of the approved works cost or a minimum of £525.

Rehabilitation / ESP

1% of the approved works cost or a minimum of £590.

The Department will also provide indicative allowances annually in relation the following operating costs:

Management Allowances (Currently Under Review)

This allowance is designed to enable the Association to provide all management services and facilities as required by this Department and other relevant legislation. The annual allowance is £396 per unit.

Maintenance Allowances (Currently Under Review)

This allowance is designed to enable the Association to provide all routine and cyclical maintenance required for each property. The annual allowance is £464 per unit for new build and £805 per unit for Rehabilitation.

These allowances are applicable to general needs units only and are reflective of rates set in other parts of the United Kingdom.