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Housing Revenue Account Subsidy

The Housing Revenue Account Subsidy system was originally established to enable the UK Government to identify the financial support needed by local authorities in England and Wales to manage their council housing.

In April 2015, the 11 Welsh local authorities exited the UK Government’s Housing Revenue Account Subsidy (HRAS) system providing the authorities with new freedom to improve housing and build new homes.

The Welsh Government and the Welsh Local Government Association worked closely with the eleven stock retaining local authorities to help them exit from the HRAS system and become self-financing following the English authorities exit from the system in 2012.

We negotiated this historic agreement with the UK Treasury. It provides the freedom for authorities to make local decisions for investment in their council housing. Welsh authorities will be better off each year and have more power and control over their housing assets. This will allow them to keep all the rental income they receive from tenants.

All rental income authorities receive must be held within their ring-fenced Housing Revenue Account. This means the income can only be used for council housing purposes and not for other general council expenditure such as education. This allows the rental income to be invested locally to help improve existing homes and build new council homes.