ABSTRACT
The HRA was thus ring-fenced, and transfers out of the HRA to the General Fund may no longer be made as a matter of policy. A transfer may be made only if a local authority has a notional surplus greater than the actual cost of rent rebates (see p. 69). Indeed, the DETR may insist that this transfer is made. It is the power to force the transfer of notional surpluses that gave central government the continued control over a local authority’s HRA even when no subsidy was being paid. The determination of a notional surplus, coupled with the requirement that an authority must balance its budget, allowed government continued leverage over rent and service levels. As part of resource accounting, the government is to allow authorities to retain surpluses so long as they use these for major repairs. This, of course, will allow government to minimise its future subsidy liability.
