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Housing: New Homes Bonus

Volume 742: debated on Tuesday 29 January 2013


Asked By

To ask Her Majesty’s Government what assessment they have made of the regional impact of the New Homes Bonus.

My Lords, I beg leave to ask the Question standing in my name and remind the House that I am a member of a local authority.

My Lords, the new homes bonus is not a regional grant. It is allocated to individual local authorities based on increases in their housing stock. Councils that build more new homes receive more funding. My department no longer produces regional statistics, not least because policies such as the new homes bonus do not operate on a regional basis.

My Lords, I thank the Minister for that practical Answer. It is the same one that she gave me on a Written Question on the same issue. I was appalled to find that the Government no longer keep regional statistics and therefore do not know the regional impact of their policies. If the Government do not know, then I will provide the information.

Is the Minister aware that in relation to the new homes bonus, which is a grant given to local authorities, the three northern regions of England, the north-east, the north-west, and Yorkshire and Humberside, get on average per head of population £8.78 new homes bonus in the current year, and that the four southern regions, the east, London, the south-east and the south-west—

This is a question. The four southern regions get £15.07 per person in their regions, which is getting on for twice as much. Is it fair that this particular system is resulting in a movement of funding from the north to the south of England?

My Lords, I am a little bit surprised by the noble Lord’s statement, and particularly his suggestion that there is a per person sum involved in this. The new homes bonus is paid against the background of new homes. It is based on the number of homes that are provided in any particular area and on the average of the council tax base across the country. Where there is a number of band A properties, a certain amount of money will be produced, across the country, and bands G and H will produce the same. If I could just correct the noble Lord, in the top 30 recipients of the new homes bonus, there are seven in the north. Bradford, Durham, Leeds, Manchester, Salford, Sheffield and Wakefield are working hard and doing well.

My Lords, can the Minister say how much of the new homes bonus has been spent on sites for Gypsies and Travellers and, if she cannot, would she write to me?

I cannot say specifically for a new home, but if new homes were being provided for Travellers, the new homes bonus would be paid. To the specific question about numbers, I will have to write to the noble Baroness.

Can the Minister assure me that all councils are well informed of the existence of this bonus and understand what they have to do to get it?

My Lords, I think that they are all more than aware. The new homes bonus has been an extremely important contribution to ensure that councils willingly accept new housing in their areas. This supports them, at least in terms of the housing provided, and gives them an incentive to ensure that new homes are built.

Is my noble friend aware that in the north-east of England, the North Tyneside Council has used the new homes bonus to undertake a welcome £3.1 million refurbishment of a public library in North Shields? That is welcome, but is not the point of the new homes bonus to act as a catalyst for the construction industry? Will she therefore join me in welcoming the news that in the north-east of England new housing starts increased by 25% over the previous period last year, which is an increase of 47% over the period in 2009?

My Lords, I am always grateful to my noble friend, because he knows the figures, and he has given them on several occasions. They show that the north-east is in fact working very hard to produce new housing. Of course, he is right: the new homes bonus is not specifically given for housing; it is given as a contribution to areas where new housing has been built. Refurbishing a new library to help with the increased population seems to me to be a perfectly acceptable use of that money.

My Lords, the noble Baroness said that the Government hold no national statistics on the impact of the new homes bonus. I wonder whether they have any statistics that show the impact on housing associations, region by region, of the bedroom tax. I speak as someone who lives in the Forest of Dean, and my own housing association, Two Rivers Housing, is being severely impacted by the bedroom tax.

My Lords, I have said that we do not keep regional statistics. We do not have regions any more; we have local areas. The regions are not recognised. We work on local areas now, which is far more exact and precise. I do not know the exact answer to the noble Baroness’s question about bedroom tax, but I am very happy to write to her.

My Lords, I am fascinated to discover that part of the country I live in is no longer recognised by the Government, but I am not surprised. Will the Minister accept that I live in the north-west of England, as does the noble Lord, Lord Greaves? Would she care to provide the House with figures on the impact of the RSG, plus the housing association grant, plus the new homes allowance, across the area which the noble Lord, Lord Greaves, and I live in?

My Lords, is it not true to say that we have to collect data on a regional basis for submission to the EU? I am somewhat perplexed by the Minister’s response.

My Lords, the Department for Communities and Local Government works on the basis of areas. There might be other parts of the Government that work on a regional basis, but the DCLG does not.

My Lords, is it not the case that the south-west gets twice as much per head of this new homes bonus as either the north-east or the north-west, and that London gets more than twice as much? These are the facts, and the Government cannot deny that there is a transfer of resources from the north of England to the south of England through this bonus. Is that not right?

My Lords, I am afraid that the noble Lord is not correct about the basis of the new homes bonus. I have explained to the House that the bonus is based on the average across the country of council tax bands. In the north of England, the chances are that the councils provided are in band A, and in the south of England it is very possible that they are provided in bands E, G and H. Consequently, of course, the sums will be larger in some areas than in others, but then, of course, the cost of living is different across this country.