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Give housing developers ‘shot in the arm’ over council tax, ministers told

The suggestion came from a former Tory minister who urged the Government to put more pressure on developers to build homes.

Housing developers should be given an “enormous shot in the arm” and charged council tax and business rates as soon as planning permission is granted, a Tory former minister has urged.

John Penrose told MPs “the meter should start running” immediately after developers are granted permission in order to ramp up house building.

His comments came after shadow housing secretary John Healey described the Government’s housing policy as a “bit like Groundhog Day” in that there had been “eight years of failure on all fronts”.

Statistics from the National House Building Council (NHBC) revealed last month the number of new houses registered to be built in the first three months of the year had fallen by 14% – the worst percentage fall in one three month period since 2012.

Mr Penrose, speaking in a Commons debate on house building, said: “To get developers building faster, councils should be able to charge business rates and council taxes starting from the day that planning permission is granted rather than when developers finally get round to start building.

“We could give big developers a few months’ grace till they get their crews on site but then the meter should start running so they would have a huge incentive to build and sell promptly rather than taking their time.”

He added: “Equally and importantly the same forces would apply to the hedge funds that own derelict brownfield land in town and city centres too.

“These sites already have old, unused permission so the clock would start ticking immediately. Just think of the enormous shot in the arm, the jolt of adrenaline we’d give to urban regeneration projects everywhere right across the country if the owners couldn’t sit on them for years any more waiting for something to turn up.”

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MP portraits

Speaking earlier in the debate, Mr Healey said it was “clear that Conservative ideology, not just Conservative policy, must change”.

He said: “After eight years of failure on all fronts, how is the answer more of the same? When since 2010 on home ownership we’ve seen a million fewer under-45s now owning their own home and the lowest level of home ownership for 30 years.

“How can the answer be more of the same on homeless when it’s risen every year since 2010 and we’ve now got 120,000 children growing up with no home. And how can the answer be more of the same when private renters have faced soaring rents, way ahead of income.”

Communities Secretary James Brokenshire said housing was the Government’s “top domestic priority”, he said: “It is totally unacceptable that we still have people out on our streets and we must turn this situation around,” adding the pilot projects for Greater Manchester, Liverpool and West Midlands would be an important step.

He added: “Everyone deserves not just a roof over their heads but a safe, secure, affordable place to call home. It is the foundation on which everything is built, it is the Government’s top domestic priority.”

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Laura Smith told MPs that she did not own her own home (PA)

Labour’s Laura Smith (Crewe and Nantwich), a non-homeowner, said she could speak for most people privately renting in saying that saving for a deposit is “being made increasingly difficult due to the cost of living compared to income”.

She said: “I wonder how many of us here have had to struggle to scrape together agency fees, find a deposit to put down on a rental property, find the first month’s rent while still paying all the other basic bills and essentials for their family and all the time whilst doing this dealing with the added pressure of trying to think about how to ever come out of that cycle of renting rather than owning your own property.

“Countless times I myself as a non-homeowner have been advised by well-meaning people that renting is throwing money away and I really ought to be saving for a deposit on my own property.

“Well I think I can speak for most privately renting and say of course that is the preferred route anyone would want but the likelihood of this happening is being made increasingly difficult due to the cost of living compared to income.

“People who rent are faced with significant upfront costs and often very short tenures and they have to pay more fees and find large deposits every single time they move.”

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