£146m incentive for Councils to build more homes

Councils across the country will get a share of a £146million funding pot to plan and deliver new homes, Housing Minister John Healey has confirmed.

The Housing and Planning Delivery Grant (HPDG) provides a direct incentive for councils to work with partners in the public and private sector to ensure that new homes are built where they are needed. It is an additional top up to mainstream funding and councils can choose how to spend it locally.

The grant backs the commitment set out by the Government to build more social homes including an extra £1.5 billion towards building a total of 110,000 new affordable homes over the next two years.

Last year councils received £135million to help them build new homes where families need them. The actual amount councils receive is based on the number of new homes provided and meeting a number of planning requirements such as having at least five years worth of suitable sites ready for housing and a further ten years worth for future development.

The average grant councils receive is approximately £390,000, paid to 375 authorities.
In order to be eligible for the planning element of the grant, local authorities must show progress on:
•continuing to provide suitable land for development over future years, particularly as the housing market recovers from current economic challenges;
•providing the local plans necessary to deliver the needed homes;
•carrying out a strategic assessment of their housing market.

John Healey said:
"The need for more homes remains despite the recession, and we are determined to see more homes built to help improve affordability - particularly for first-time buyers, reduce pressure on waiting lists and address over-crowding.

"While many councils are playing their proper planning role, some are failing to identify land for the homes their communities need. Ensuring land is available for housing is vital to help secure both house building and economic recovery.

"A shortage of new houses pushes up house prices, council waiting lists and private sector. This incentive will also ensure that all councils are taking action now and will give the housebuilding industry greater certainty and confidence in the economic recovery."