HOMES BONUS WILL CAUSE COUNCIL TAX ‘CHAOS’ IN DERBY

THE Government’s plans for a ‘new homes bonus’ will cause council tax chaos and annihilate George Osborne’s promise of a council tax freeze.

The scheme, planned by the Conservatives before the Election and confirmed in August, promises to match council tax raised on every new home built for six years. But money paid to councils under the scheme will be cut from the total local government grant.

The cost in the first year is an estimated £250million. I have discovered that Derby would lose over £1m in the first year alone, rising to more than £22.5m over six years.

There would have to be 1,285 homes built each and every year in Derby just stop the council losing money under this flawed scheme.

Big towns and cities like Derby across the country will be especially hard hit, as they stand to lose the most from their grant funding, and often have the least available space on which to build.

This incentive scheme hasn’t been thought through. It will do nothing to build new homes and Derby people will be left facing even deeper cuts to public services, and higher council tax bills.

The ConDem Government should be offering a genuine incentive and planning system to build homes, rather than promoting this con-trick that will actually cut housing investment around the country.

Speaking in Manchester at the Labour conference of Friday, shadow housing minister, John Healey said: “Those councils that see new homes built will win but those that won’t or can’t build will lose out, and lose big. This scheme robs some councils to pay others.”

He added: “The Government is right to want a strong incentive system for councils and communities ready to see new homes built. But this isn’t it.”