Housing: New Homes Bonus

Lord Greaves Excerpts

Tuesday 29th January 2013 Lords Chamber

Asked By

[Lord Greaves]

To ask Her Majesty’s Government what assessment they have made of the regional impact of the New Homes Bonus.

[Lord Greaves]

My Lords, I beg leave to ask the Question standing in my name and remind the House that I am a member of a local authority.

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)]

My Lords, the new homes bonus is not a regional grant. It is allocated to individual local authorities based on increases in their housing stock. Councils that build more new homes receive more funding. My department no longer produces regional statistics, not least because policies such as the new homes bonus do not operate on a regional basis.

[Lord Greaves]

My Lords, I thank the Minister for that practical Answer. It is the same one that she gave me on a Written Question on the same issue. I was appalled to find that the Government no longer keep regional statistics and therefore do not know the regional impact of their policies. If the Government do not know, then I will provide the information.

Is the Minister aware that in relation to the new homes bonus, which is a grant given to local authorities, the three northern regions of England, the north-east, the north-west, and Yorkshire and Humberside, get on average per head of population £8.78 new homes bonus in the current year, and that the four southern regions, the east, London, the south-east and the south-west—

[Noble Lords]

Question!

[Lord Greaves]

This is a question. The four southern regions get £15.07 per person in their regions, which is getting on for twice as much. Is it fair that this particular system is resulting in a movement of funding from the north to the south of England?

[Baroness Hanham]

My Lords, I am a little bit surprised by the noble Lord’s statement, and particularly his suggestion that there is a per person sum involved in this. The new homes bonus is paid against the background of new homes. It is based on the number of homes that are provided in any particular area and on the average of the council tax base across the country. Where there is a number of band A properties, a certain amount of money will be produced, across the country, and bands G and H will produce the same. If I could just correct the noble Lord, in the top 30 recipients of the new homes bonus, there are seven in the north. Bradford, Durham, Leeds, Manchester, Salford, Sheffield and Wakefield are working hard and doing well.

--- Later in debate ---

[Baroness Hanham]

My Lords, the Department for Communities and Local Government works on the basis of areas. There might be other parts of the Government that work on a regional basis, but the DCLG does not.

[Lord Greaves]

My Lords, is it not the case that the south-west gets twice as much per head of this new homes bonus as either the north-east or the north-west, and that London gets more than twice as much? These are the facts, and the Government cannot deny that there is a transfer of resources from the north of England to the south of England through this bonus. Is that not right?

[Baroness Hanham]

My Lords, I am afraid that the noble Lord is not correct about the basis of the new homes bonus. I have explained to the House that the bonus is based on the average across the country of council tax bands. In the north of England, the chances are that the councils provided are in band A, and in the south of England it is very possible that they are provided in bands E, G and H. Consequently, of course, the sums will be larger in some areas than in others, but then, of course, the cost of living is different across this country.