New Homes Bonus will not boost development, say MPs

The New Homes Bonus will not lead to an increase in housing construction, an influential committee of MPs has found.

A report on the government’s abolition of regional spatial strategies by the communities select committee said the abolition would hinder development, delay housebuilding and hamper the economic recovery.

Committee chair Clive Betts said: “We welcome the government’s recognition that we need to build more houses. However, we question the likelihood of achieving this increase through the New Homes Bonus. There is no evidence this mechanism will increase housing supply by 8-13% in the way that ministers predict.”

The committee agreed with evidence given by Tetlow King Planning that the number of homes planned by councils had fallen by over 200,000 since last year’s election. Betts also supported countryside campaigners who complain that the incentive to build homes cuts against the impartial nature of the planning system.

Betts said: “We conclude that this government may face a stark choice between whether to build fewer homes than its predecessors, or abandon its commitment to promote localism in decisions of this kind.”

The report also calls for more detail in the localism bill to ensure that planning decisions which cut across local authority boundaries can be properly dealt with.