Huge blow to Angela Rayner's plans to build new towns across UK - as each will cost £4bn

's flagship plan to deliver a across England could be scuppered by soaring costs, workforce shortages and under-resourced councils, a bombshell new report has warned - with each site expected to cost up to £4bn. The and Secretary of State for Levelling Up, Housing and Communities, who is spearheading the Government's housebuilding agenda, wants to build 12 new towns of at least 10,000 homes as part of the push to deliver 1.5 million additional homes during this Parliament.

A New Towns Taskforce has been created to lead the process, while more than 100 bids from local authorities are currently being considered. However, a study by WPI Strategy, authored by former MHCLG economist Paul Chamberlain, raises serious concerns about the feasibility of the idea. The report, entitled New Towns for England: Where should they be and how can they be funded and delivered?, outlines the full financial scale of the plan and warns construction could stall unless the Government implements major structural reforms.

Mr Chamberlain estimates that each new town will cost between £3.5bn and £4bn to deliver, taking into account land, infrastructure, and public buildings.

He also highlighted a lack of planning capacity and a severe shortage of construction workers as major obstacles to progress.

Public sector funding must be used to unlock private investment by reducing risk at the early stages, the report warns.

Mr Chamberlain proposed a "Pipeline Fund", backed by £22.5M of private capital, to recruit 225 expert planners and deploy them to local authorities with the greatest capacity shortfalls.

The fund would be run by an independent body to avoid conflicts of interest and allow councils to share access to specialist staff.

WPI Strategy has identified 10 locations in total: Milton Keynes, Leeds, South Gloucestershire, Central Bedfordshire, Wiltshire, Huntingdonshire, West Northamptonshire, Mid Devon, South Cambridgeshire, Winchester, East Hertfordshire, and Northumberland.

The report singles out Milton Keynes and Leeds as the most deliverable sites based on land availability, infrastructure access, economic connectivity, housing need, and public support. Milton Keynes is cited as the "trailblazer town" most likely to move ahead first.

It also recommends a phased development model focused on mixed-tenure housing and affordable rents, arguing that long-term social value for existing communities must be built into each project from the outset.

The report calls for the scaling-up of modular construction to ease labour pressure and reduce costs - though it cautions that lessons must be learned from recent failures in the sector. Several modern methods of construction (MMC) firms have collapsed amid weak demand and high upfront costs.

Mr Chamberlain also warns that the Government's wider housebuilding targets may be at risk, with estimates suggesting up to 500,000 additional workers will be needed, not including demand from airport expansions, clean energy projects and other infrastructure schemes.

A Ministry of Housing, Communities and Local Government spokesperson said: "Any hypothetical cost projections associated with the New Towns programme are at this stage pure speculation.

"We are awaiting the recommendations from the independent New Towns Taskforce on potential locations for new towns and we will receive this later this year.

"The Taskforce is working in partnership with local leaders and communities, and its selection of sites will be made in the national interest."Our next generation of new towns will be well-designed communities of at least 10,000 homes each, with many significantly larger, as part of the biggest housebuilding programme since the Second World War."

Speaking in August, Ms Rayner said: "For far too long the delivery of tens of thousands of new homes has been held back by a failure to make sure the development system is working as it should.

"This government has a moral obligation to do everything within our power to build the homes that people desperately need and we won't hesitate to intervene where we need to.

"Our New Homes Accelerator will quickly identify blockages, fix problems and support local authorities and developers to get shovels in the ground."