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New Homes Bonus

Volume 526: debated on Monday 4 April 2011

2. What assessment he has made of the potential benefits to Kirklees district of the new homes bonus. (50340)

Today, I have announced the final allocations to local authorities under the new homes bonus for 2011-12. All parts of England will receive significant funding from the scheme. Kirklees will receive £1.3 million, Rugby £435,000 and Gloucester £782,000. The funding is completely un-ring-fenced and councils will be able to use it according to the wishes of their local communities.

I thank the Minister for that reply. Will he confirm the protection of the green belt and will he consider the suggestion from the Campaign to Protect Rural England perhaps to have an enhanced rate of new homes bonus for brownfield sites to encourage regeneration?

I looked carefully at the new homes bonus and at where there should be an uplift and I came to the conclusion that the only uplift we would give would be to those who built additional affordable homes, and that is a block grant of £350 per home. The green belt is entirely protected; that is in the coalition agreement and we stand by that position.

The local authority in my constituency of Rugby has been quick to recognise the benefits that come with the new homes bonus and it has ambitious proposals for new housing development. What steps is the Minister taking to ensure that planning authorities across England recognise the lead of authorities such as Rugby and allocate land for the new homes that are so badly needed?

In many ways, authorities such as Rugby have led the way by being so keen to produce housing. The difference is that now every single one of our constituents gets to benefit from new homes being built. There is £200 million on the table that is being distributed today. I note that the Opposition seem to be against their own authorities receiving the money.

Like my hon. Friend the Member for Colne Valley (Jason McCartney), may I ask my right hon. Friend whether more could be done, perhaps on the paperwork, in order to attract developers into constituencies such as mine, which are entirely urban and therefore have only brownfield sites to offer?

One of the changes that we have made is to enable local authorities to set their own targets for brownfield sites. I have been to my hon. Friend’s constituency and I know that there are many good sites available. Rather than housing being built on sites where the regional spatial strategy seemed to insist that it went, housing can now go where it is required. Much of that will be on the brownfield land that I went to see. That is one of the features of the Government’s policy, and of the new homes bonus in particular.

Last week the Minister for Housing and Local Government wrote to my hon. Friend the Member for Plymouth, Moor View (Alison Seabeck) and claimed that the new homes bonus will not penalise deprived areas to favour more affluent ones. Can he explain to me why his figures differ so widely from those of the National Housing Federation, which estimates that the four northern regions of England will lose £104 million, whereas the five southern regions will gain £342 million?

It may have escaped the attention of Opposition Members that the new homes bonus rewards the authorities that build homes. That is why it is called the new homes bonus. Of the five areas that are building the most homes—the five top councils to receive the new homes bonus—three of them are in the midlands and the north.

The Government’s stated objective is to ensure that more new homes are built than were being built before the recession. I am sure that it is an objective with which we can all agree. However, if the new homes bonus does not incentivise individual authorities sufficiently so that the sum total of all the individual parts does not meet the Government’s objective, what is plan B?

The point about the new homes bonus is that it is just one element in a series of steps that we are taking to ensure that house building goes ahead. The hon. Gentleman is right to mention that it slumped to the lowest level since 1924 under the old top-down targets. The new homes bonus will ensure that £200 million is distributed today, but it does not stop there. We are also proposing build now, pay later. We are slimming down some of the many regulations that prevent house builders from getting homes built faster, and we are encouraging them to renegotiate section 106.

The hon. Lady says that it is not working, but we have already seen an increase in the number of homes planned and starting to be built.

The Ansty technology park is in Rugby and the Government announced on Friday that they would sell it off. That was an important job-creation opportunity brought into existence by the old regional development agency which was scrapped by the Government. Would it not be preposterous if Rugby gained from the new homes bonus through developing such a site for housing?

The new homes bonus is entirely flexible to allow local authorities to decide how the cash that comes in is spent—those hundreds of millions of pounds being distributed today—so that they can take it and use it for their own objectives. There is a conversation to be held locally rather than nationally about how that money is used in Rugby.