Housing Minister Grant Shapps has told councils that local communities who go for growth now and in the future will receive direct and substantial extra funding to spend as they wish - whether council tax discounts for local residents, boosting frontline services like rubbish collection, or improving local facilities like playgrounds.
Housebuilding has been declining over the past few years and is at its lowest peacetime level since 1924. The New Homes Bonus, which will be introduced early in the Spending Review period, is part of the strategy to reverse the situation.
The Minister confirmed that councils who take action now to give planning consent and support the construction of new homes where they are needed and wanted will receive direct and substantial benefit for their actions.
Mr Shapps urged councils to open up an honest and direct debate with the communities they serve about the benefits of building new homes in their area - how they can reap the benefits of development and not just the costs.
In a letter to councils, Mr Shapps also confirmed that the Government is working on business rate reforms to encourage economic development, as well as reforming the Community Infrastructure Levy to provide an even clearer incentive to develop.
The Minister said:
"We have wasted no time scrapping the ineffective top-down planning system that forced unsustainable development on communities and are returning control of a much faster and more responsive planning system to local people.
"We will not tell communities how or where to build, or how they should grow. But the New Homes Bonus will ensure that those communities that go for growth reap the benefits of development, not just the costs.
With housebuilding falling to its lowest level since 1924, action is needed now to build the homes the country needs. That's why these new powerful incentives to build will be introduced early in the Spending Review period. And it's why I have confirmed that those councils who go for growth by providing planning permission now will reap the rewards.
"I urge councils to seize the moment and open up a debate with their communities now about the new homes they need and how they would use the new Bonus."
A consultation paper on the final scheme will be published following the spending review.
Developments that will deliver more than 500 affordable homes for London have received a boost from the Mayor Boris Johnson and the London Homes and Communities Agency (HCA).
Investment for 16 housing and regeneration schemes has been approved by the HCA London Board, chaired by the Mayor, and will deliver a total of 518 affordable homes to help meet London's housing needs.
The schemes were originally included as part of the previous Government's Housing Pledge, had been at risk because of funding uncertainties.
The 16 projects consist of seven former 'Kickstart' and nine local authority new build schemes. In total more than £51.7 million of investment is being provided to support these projects from the London region budget.
Seven boroughs will benefit from funding to replace the former Kickstart programme, which will deliver 372 affordable units across the projects. Each scheme has been stalled since the credit crunch.
In addition, nine local authority new build projects being supported will provide 146 new rented homes for 665 people. Each scheme is expected to contribute to the Mayor's target of 50,000 new affordable housing completions by March 2012.
The majority of these developments will deliver a high percentage of large family sized homes, which are in particularly high demand.
The Nationwide Foundation has invested £262,500 towards the Community Land Trust Fund, an initiative providing affordable homes to people priced out of their communities in which they were brought up.
The Community Land Trust Fund is a partnership involving four charities: the Nationwide Foundation, Tudor Trust, Esmee Fairbairn Foundation and CAF Venturesome. The aim of the Fund is to remove barriers to the development of community land trust projects.
The Fund provides professional and technical support to trusts, from inception of the CLT through to occupancy of the affordable houses.
The Community Land Trust Fund supports the development of community land trusts (CLT). There are many CLTs being set up across the UK and the initiative involves a group of local people - often volunteers - working together to develop affordable homes for local people on low incomes.
The CLT acquires land and builds properties, which are sold at below the market rate. One aspect which makes the CLT model for affordable housing distinct is that the land is held in perpetuity by the Trust, therefore ensuring long-term affordability.
CLTs are financed and supported to undertake feasibility studies, prepare development and business plans, secure planning permission and help to access bank finance. The funding from Nationwide Foundation will be used for financing the construction of homes.
England
Birmingham City Council
After successfully securing government funding from the Homes and Communities Agency (HCA) through the Public Land Programme, Birmingham City Council is gearing up to provide another 234 high quality, family homes across the City.
The Council had already pledged to donate its own land, worth £8.1 million, to deliver much needed family homes across 7 sites in Birmingham.
The HCA has now confirmed its support of up to £4.7m of investment to deliver the plans, from the £53 million national funding pot. The Council is keen to swing into action, with construction work set to commence in late 2010. All 234 homes are due to be completed and ready for occupation by spring 2012.
The new homes are in addition to 319 new homes being delivered by the Birmingham Municipal Housing Trust, as part of the Council's current £32 million house building programme. Under this programme the Council started building homes earlier this year for rent and sale, side by side.