New towns funding will come from all government departments, minister confirms

The government set out seven sites for new towns in March – cut down from the New Towns Taskforce’s recommended 12 locations – and a consultation on this shortlist ran until mid-May.

Baroness Taylor said delivery of the new towns will be backed by funding across housing programmes, including the £39bn Social and Affordable Homes Programme, as well as additional capital funding from the National Housing Bank.

She said: “We will continue to consider the ways in which private finance can support delivery, alongside government funding and intervention. 

“We will be working with other departments and regulators to ensure that they are factoring new towns into their spending plans for the future to make sure that that comes forward from all departments across government.”

This includes making sure that new towns have the necessary utilities, transport and social infrastructure.

The Lords minister said each location will “benefit from resource and capital funding”.

“That could include a mixture of grant and financial instruments, including equity investment, loans and guarantees to develop town-wide master plans, comprehensive infrastructure, and the establishment and maintenance of governance structures,” she said. 

But she told peers that the “precise funding offer will be confirmed once final decisions on the programme have been taken”.

Baroness Taylor also said the government is proposing the establishment of a ‘new town place review panel’, which will provide impartial advice to delivery bodies and planning authorities, as well as practical design and placemaking guidance. 

As confirmed in the government’s New Towns Draft Programme, Baroness Taylor reiterated to peers that each town’s housing delivery will contribute towards local housing targets.

She said: “The government consider that the delivery of housing in new town proposals should contribute towards meeting the identified housing need of relevant strategic and local planning authorities in all instances. 

“We are clear that that is the way we are approaching the housing that will be included in new town developments.”

Each new town is set to have at least 10,000 new homes, with a target for 40% to be affordable and 20% social housing, though the housing secretary has previously admitted there may be “some flex” on this depending on viability.