Housing minister Grant Shapps has today told councils that houses they build now will result in direct and non-ringfenced income to spend in future.

Today, Shapps told local authorities that a new incentives  scheme called the New Homes Bonus is set to be introduced early in the next spending review period, which begins in October.

He said councils that give planning consent and support the construction of new homes where they are needed and wanted will receive direct and substantial benefit for their actions.

The government is looking at new ways of incentivising councils to build homes after it scrapped Regional Spatial Strategies and their housing targets in June.

In a letter to councils, Shapps said the government was working on business rate reforms to encourage economic development, and reforming the Community Infrastructure Levy to provide councils with another supposed incentive to develop.

However, the letter failed to give further detail on any of these reforms.

Shapps said: “”We will not tell communities how or where to build, or how they should grow.

“But the New Homes Bonus will ensure that those communities that go for growth reap the benefits of development, not just the costs.

“I urge councils to seize the moment and open up a debate with their communities now about the new homes they need and how they would use the new bonus.”

The government says it will publish a consultation paper on the final incentives scheme  following the spending review.

To read the letter, click here: English LA Leaders – New Homes Bonus

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