HARTLEPOOL Borough Council will lose more than £700,000 in the next six years to pay for new homes to be built elsewhere in the country.
The Government’s New Homes Bonus was designed as an incentive to local authorities for providing new homes and businesses and provides a cash bonus when a new home is first occupied.
But campaigners say the money for the reward is taken from the fund which is used for most day-to-day council services.
Hartlepool Borough Council is set to receive more than £1.5m over the next six years as part of the New Homes Bonus, but will lose almost £2.4m to help fund the scheme.
It will see the council lose £729,910 overall, while areas south of the town will receive up to £15m in Government handouts.
The figures have been released by the Northern Housing Consortium which has warned the Government it must find a better way of funding the New Homes Bonus.
The report revealed Durham County Council will also be hit hard and will lose more than £3m by 2017.
Stockton Borough Council, which covers Billingham, Wynyard and Wolviston, will benefit from the scheme and will receive just short of £1.1m in the six-year period.