Councils face £28m New Homes Bonus loss

Sixty-six English local authorities that have yet to submit a local plan for examination could collectively miss out on more than £28 million of New Homes Bonus cash in 2017/18 should they fail to make further progress with their planning blueprints, an analysis suggests.

Construction in Salford: authority set to receive more than £10 million of New Homes Bonus cash in 2016/17 (picture by Pimlico Badger)
Construction in Salford: authority set to receive more than £10 million of New Homes Bonus cash in 2016/17 (picture by Pimlico Badger)

Under the New Homes Bonus scheme, the government matches the council tax earned by local authorities from each new home built, converted or brought back into use over a six-year period.

A government consultation published in December 2015 proposes that, from 2017/18 onwards, local authorities which have not submitted a local plan for examination would not receive new New Homes Bonus allocations for the years for which that remains the case. Legacy payments relating to allocations in previous years would be unaffected, the consultation makes clear.

According to an analysis published today by Planning, a group of 66 local authorities which, according to the Planning Inspectorate, have yet to submit their plans for examination stand to lose out on £28.1 million in 2017/18 should their plans fail to meet this milestone.

Planning's analysis indicates that Salford City Council - which is set to receive £10.9 million of New Homes Bonus cash in 2016/17 - could lose out on the most bonus cash, with more than £2 million at risk (see infographic below).

Durham County Council and Kirklees Council both stand to miss out on £1.3 million under the proposals, Planning's analysis suggests.


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