Councils receive millions in new homes cash

Councils have today received government payments of anything from £5,000 to £4m for the first year of the New Homes Bonus designed to provide incentives for councils to allow homes to be built in their areas.

London councils received some of the highest payments, with Tower Hamlets council topping the list, receiving £4.29m after 2,934 homes were built in its area. Scarborough council received the smallest bonus, after just 25 homes were added to its stock.

Other big winners from the allocations included Islington council, netting £3.7m, Birmingham, with £3.2m, and Leeds with £2.7m.

In total, the government is spending £200m on the incentive this year and has allocated a total of £950m to spend over the spending review period to 2014. In future years much of the funding will be taken from councils’ existing funding settlement from government.

Housing minister Grant Shapps said: “This country needs more homes, so we need the nation to start building again – but this time with the backing of local communities rather than in the teeth of their opposition. That’s why we’re giving communities a reason to say yes to new homes through these powerful cash incentives.

“But this funding from government is only the start of the process – it is now essential that councils engage with their local community to decide how the money is spent, so residents feel the direct benefits of growth, rather than extra pressure on local services.”