Magazine article Public Finance

Funding for Councils to Boost New Housing

Magazine article Public Finance

Funding for Councils to Boost New Housing

Article excerpt

Local authorities are to be offered incentives to free land for housing and make better use of empty properties, under government plans published on October 26.

A total of £510m will be available to councils in 2008/11 through a new housing and planning delivery grant - £85m more than under the scheme it is set to replace.

Councils showing an annual increase of more than 0.75% in the number of homes in their area will receive £1,100 for each extra one, as well as developer contributions and other infrastructure funding, said housing minister Yvette Cooper.

But the Local Government Association, while welcoming the extra money, said it was wrong to penalise councils in more densely populated areas that have less development land.

The new grant is due to replace the planning delivery grant, worth £425m over the past three years. Whereas the PDG rewards efficient turnaround of planning applications as well as plan making, the new grant will focus solely on development.

Councils that fail to identify enough development sites to attract extra money will be forced to rely on higher planning fees. These might need to rise by more than 50%, says the LGA. …

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