The government has issued a consultation paper seeking views on
options to change the New Homes Bonus in order to better reflect
councils' delivery of new housing.
The New Homes Bonus is a grant paid by Central Government to
local councils to reflect and incentivise housing growth in their
The New Homes Bonus is currently paid each year for six years.
It is based on the amount of extra Council Tax revenue raised for
new build homes, conversions and long-term empty homes brought back
into use. There is also an extra payment for providing affordable
Details for the provisional allocations New Homes Bonus for 2016
to 2017 bring the total amount allocated to local councils to over
£4.8 billion. Councils can decide how to spend the New Homes Bonus.
However, the government expects councils to consult communities
about how they will spend the money.
The consultation paper also seeks views on reducing the number
of years in which both current and future payments are made from
the six years to four.
Changes are proposed to be introduced from the 2017/2018
financial year. The proposals are likely to have major financial
implications for some councils.
Deadline for responses is 10 March 2016.
View the consultation paper.