Councils will be offered extra cash for every new home they allow to be built in their areas under a scheme designed to ease housing shortages
Under the New Homes Bonus, the Government will match the council tax raised on each new dwelling, Housing Minister Grant Shapps will announce tomorrow.
Town halls, which are braced for a tough squeeze in October’s wider public spending review, are expected to be free to spend the money how they wish.
Shapps said: ‘We will not tell communities how or where to build. But the New Homes Bonus will ensure that those communities that go for growth reap the benefits of development, not just the costs.
‘With house building falling to its lowest level since 1924 under the previous government, action is needed now to build the homes the country needs.’
Shadow housing minister John Healey said: ‘Not content with misleading the public about a ‘black hole’ in funding for housing, this Government is now set on conning councils with a home builders ‘bonus’.
‘The cost will run into billions, met mainly - as Tory proposals indicated before the election - by existing grants to local councils.
‘Given the potential impact on essential local services, we could quite literally see government robbing Peterborough to pay Poole.’
Example: Should a local authority rubberstamp 100 Band D dwellings – an average council tax figure of £1,439 (in England) – it will receive an extra £863,400 to spend.
Glenigan figures - year to July 2010 (£ million worth of residential contracts)
1 Powell Dobson £186.20
2 Quattro £176.89
3 Pentan £170.07
4 PRP £167.60
5 Munro £155.00
6 Willdig Lammie £155.00
7 Ainsley Gommon £155.00
8 RHWL £150.00
9 David Walker £150.00
10 CZWG £110.00