The housing minister and his Labour shadow have clashed in parliament, with both accusing the other of not understanding the new homes bonus policy. Shadow housing minister Alison Seabeck said the policy, which rewards councils for approving developments by matching council tax income from new properties for six years, would result in greater payments for affluent areas. Quoting figures from the House of Commons library, she said Kensington and Chelsea, for example, would receive 91 per cent more per home than Hull. She said this would result in a transfer of funding from affluent to deprived areas as formula grant is cut to pay for the scheme.
Mr Shapps said she ‘may have misunderstood the way this policy operates, despite the fact that I published it the week before last’. He said the payments would be based on a countrywide average according to council tax band, and that £1 billion has been provided for the new homes bonus that will not be top sliced from formula grant. However Ms Seabeck’s office said the figures she quoted took into account the averaging of payments by band, and were based on the number of homes in the various bands in the two areas. It also noted the £1 billion figure will quickly be exhausted if the scheme develops as planned. Read more on Inside Housing.
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