by Jill Sherman, Whitehall Editor of The Times
Government offers cash incentives to ease housing shortage
Town halls are to be given a £1,000 cash bonus for each extra house they build above minimum levels in a bid to speed up affordable developments, Yvette Cooper disclosed yesterday.
The financial incentives are part of a drive to reach Gordon Brown’s ambitious target of building 3 million new homes by 2020, already facing opposition among environmental campaigners.
The Housing Minister told The Times that councils would be given extra cash if they increased their current stock by more than 75 per cent a year.
Ms Cooper said family homes would attract bigger incentives than smaller houses or flats - ranging from £800 to £1200 - and that the sums could rise to £5,000 per dwelling by 2010/11. Councils will be given the freedom to use the money totalling £510 million over three years for any purpose, she said.
Manchester, for example, which is planning to build 2,500 homes this year, 1,000 more the 75 per cent required, will be eligible for a £1 million cash bonus.
In a consultation paper published yesterday Ms Cooper also gave townhalls a licence to tear up previous regional development plans to allow them to build more homes. Most district and unitary councils are currently required to follow three to five year plans set by regional assemblies.
Many have claimed they have wanted to build more but have been prevented by these outdated regional targets which are regarded as a ceiling on the number of homes that can be built. Ms Cooper has now given councils the go ahead to build more houses, provided there is local need and the schemes go through normal consultation processes.
But many authorities are likely to face intense opposition from local residents who don’t want massive new developments springing up locally. Efforts to increase housing developments under current plans are already being thwarted by bitter local wrangles and regional assemblies have been accused of blocking the Government’s proposals.
Opposition parties will accuse the Goverment of trying to push through the building targets by bribing townhalls. But Ms Cooper told the Times that communities who built more should be rewarded to help fill the current housing shortfall. “We need to provide more homes for first time buyers and families of this and future generations,” she said.
“That’s why we pledged £8billion of investment for more affordable and social homes. We want to give more support to communities and councils who are doing their bit to deliver the extra housing needed, including bringing more empty homes back into use.”
Officials said about 50 per cent of councils would be eligible this year for the £1,000 bonuses which would allocated annually.
But the cash will only be allocated if authorities also follow plans to tackle empty homes in their areas. Councils will be offered a range of additional incentives including grants to refurbish empty properties.
As a last resort they will be able to use compulsory purchase orders where voluntary measures have failed. Owners of empty properties are already eligible for tax breaks on reburbishing empty homes but townhalls can also set higher council tax on homes empty for long periods.
There are now an estimated 670,000 empty homes and properties including nearly 300,000 long term empty houses in England, said a spokesman for the Communities department.
Earlier this year Ms Cooper set out further details of the building programme in a housing green paper, including proposals to allow townhalls to borrow from the private sector so they could build more themselves.
Gordon Brown reassured rural campaigners at the time that there would be no review of existing greenbelt land and that the majority of the new housing would be on previously developed brownfield land.
At present 74 per cent of building is on brownfield and 26 per cent on greenfield. But rural groups suspect the governnment may be forced to change its policy in the medium term if there is not enough available land.
At the moment 185,000 homes in England are built a year, which was due to rise to 200,000 by 2016. The Prime Minister’s £8 billion programme will raise that target to 240,000 a year by 2016, a 55,000 increase from this year.