Agenda item

The Chair invited Hannah Donnelly (Finance Policy Team) to discuss the paper. In her summary, Hannah noted the following points:

-          The consultation was seeking views on reform of existing elements of the New Homes Bonus (NHB) and the potential addition of new conditions. These changes included an increase to the existing baseline threshold over which payments for new homes are made, as well linking the Bonus to the proposed new Infrastructure Levy, the use of Modern Methods of Construction and maintaining an up-to-date local plan.

-          The consultation confirmed the ending of legacy payments after 2022/23 – the remaining year with previous legacy payments attached – and did not seek views on this. It was not clear from the consultation what the Government intends to do with savings made from removing the legacy payments.

In the subsequent discussion the members raised the following points:

-          Concerns were noted with the proposed use of Modern Methods of Construction as a qualification for payment. It was felt that design principles and sustainability were more appropriate, and the conditions of the Bonus should only be factors that councils have control over.

-          It was suggested that current thrershold and proposal to increase it may be seen to reinforce already overinflated markets.

-          It was recognised that the LGA may not wish to enter the debate on the tier split.

-          A suggestion was made around linking the Bonus to the Government’s net zero carbon target and ensuring that homes and housebuilding deliver against the climate change agenda.

The Chair summarised the discussion above and noted that the funding for the Bonus was top sliced and any savings from changes should be given back to local government, questioned the incentivisation effect of the threshold, and recognised the importance of an affordable housing incentive.

Decision

The members of the Resources Board noted the report.

Action

Officers to proceed in line with members comments.