The government will crack down on councils without a clear housing plan by cutting them off from a landmark £2.3bn housing fund announced in the Autumn Statement, Property Week can reveal.

Philip Hammond

The chancellor’s Housing Infrastructure Fund will be withheld from unprepared councils - Source: Shutterstock/Twocoms

Chancellor Philip Hammond claimed last month that the Housing Infrastructure Fund would pay for the infrastructure needed to develop an extra 100,000 homes, but it is believed that the new year’s housing white paper will include measures barring councils without up-to-date local plans from being eligible to bid for a share of the money.

Ministers are mulling the idea as a way of solving the conflict that often arises between developers and local authorities in areas without housing plans.

The Home Builders Federation welcomed the proposal. Head of planning Andrew Whitaker said: “Far too often, local authorities don’t see development as the price of infrastructure - the two go hand-in-hand.”

Deadline for April 2017

Sources close to the situation suggested the government would go further, by announcing plans to withhold a percentage of the New Homes Bonus - which sees Whitehall match the council tax take on new-build homes for six years - from authorities without a local plan. The money saved would be distributed among better-performing councils.

Research from Nathaniel Lichfield & Partners earlier this year showed that 50% of local authorities did not have an up-to-date plan setting out how many homes are needed locally and allocating potential development sites. Meanwhile, Savills estimates that outside London that number is as high as 66%.

Last year, the government set a deadline of April 2017 for councils to write local plans, warning that it would step in and write them for any authorities that acted slowly.

Determine the number of homes

It is thought that the white paper will push back this deadline, giving local authorities more time to compile their development plans.

The punitive measures would be introduced alongside a new approach to determining the number of homes needed in an area. The white paper is expected to introduce a standard set of criteria for assessing housing need, streamlining the process for local authorities.


Source: Shutterstock/Karamysh

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Ministers are still thrashing out the details of the white paper, the publication of which was expected by the end of the year but has now been delayed until January.

Sources said the government was taking more time to beef up its proposals so they could be better implemented and understood by local authorities and developers.