Department for Communities and Local Government: New Homes Bonus

01 December 2010

This consultation sought views on proposals suggesting that the Government would match council tax for the first six years through the New Homes Bonus as a means to incentivise local authorities to increase housing supply.

ANEC's response outlined general support for the principle of returning money to local authorities for six years, but noted that this should be seen in the context of a possible net loss of income to local authorities due to the top-slicing of Formula Grant and the abolition of Housing Planning Delivery Grant. It was also highlighted that the scheme will not address the main barrier to development in the North East, which is the restrictive lending market. Further, there is a danger that the proposals will redistribute money from local authorities in the North East to other parts of England with stronger housing markets due to the history of past market failures suggesting that the North East feels the decline harder, and takes longer to recover, than other parts of England. The Government has now published the first set of New Homes Bonus Allocations covering 2011/12.

Read ANEC's full response to DCLG on the New Homes Bonus

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