Council to receive £3m as a reward for approving 479 homes

The New Homes Bonus is a multi-billion pound Government scheme which is aimed at encouraging local authorities to grant planning permissions for the building of new houses in return for additional revenue.
In total, the district council has now received £8,144,500 since the scheme was introduced in 2011 as a reward for delivering 1,712 homes.
As the £3,062,256 grant for 2015/16 is not ring-fenced, the council is free to spend it in any way it chooses, including supporting town centre generation or new and existing services.
However, the Government says it expects local councils to consult communities about how the money should be spent.
The New Homes Bonus for 2015/16 will be more than double the £1,497,747 the council was handed in 2013/14.
The council’s executive portfolio holder for finance, Alan Law, said: “The money goes into a general pot for budgeting, so we don’t say, for example, there is another £100,000, let’s spend it on something specific – we don’t think that way.”
When asked whether the money could be used to prevent cuts to frontline services, Mr Law said: “It is a leap of faith to put those two things (New Homes Bonus money and cuts) together.
“There are three streams of income for the council – government grants, council tax and business rates.
“If we do not have enough money to pay for things that we need then we have to make savings.
“We are free to spend the money on whatever we choose and will allocate it according to our priorities, which will be set out in this year’s budget.”
The New Homes Bonus is paid each year for six years and is based on the amount of extra council tax revenue raised for new-build homes, conversions and long-term empty homes brought back into use. There is also an extra payment for providing affordable homes.
Under the scheme, councils get an automatic six-year 100 per cent increase in the amount of revenue derived from each new house built in their area.
The grant for 2015/16 will include an additional payment as a reward for bringing 64 empty homes back into use.
In total, the Department for Communities and Local Government has set aside almost £1bn over the Comprehensive Spending Review period (2011 to 2015) for the New Homes Bonus, with the aim of providing an additional 140,000 homes over a 10-year period.
A total of 115,600 dwellings were built in England in 2012, an increase from 108,150 in 2010.
However, the Government’s household formation projections show that around 232,000 additional homes are needed each year to meet housing need.