THE desperate house-building to cope with the huge waiting list in London’s East End has earned the Town Hall Government cash that local authorities elsewhere are missing out on.

It brought praise this week for Tower Hamlets Council from the construction industry for reaching its target last year which means it gets �4 million from Whitehall for the coming financial year.

That should boost the council’s desperate search for another �17m to save on budget cuts on top of the �55m already identified over the next three years.

But other local authorities who have not met house-building targets get nothing from the Government’s bonus scheme.

“Local authorities need to look hard at the difference the bonus could make and work with the industry to plan for more housing,” said Home Builders Federation chief executive Stewart Baseley.

“We have an acute housing crisis that has seen millions join the waiting lists for council housing and first-time buyers unable to get a foot on the property ladder.”

Tower Hamlets stands to get �4,280,000 for new homes built in 2009-10, while one local council in Hampshire which only built 10 receives nothing—it actually reduced its housing stock by 39.

The bonus scheme is a cornerstone of the ‘localism’ planning system the Government hopes will encourage more house-building.

The Coalition’s projections show the country should be adding 232,000 new homes a year. Yet figures show only 100,000 built last year, the lowest in peacetime since 1923.