Prescott launches homes explosion

John Prescott is pushing the button today for an explosion of new building in London and the South-East, including at least 90,000 cheap starter homes for key workers such as nurses and teachers.

He will announce moves to speed up a rush of developments by abolishing most of the powers of local councils to block new housing estates or delay major infrastructure schemes.

But the Deputy Prime Minister has finally backed down on one of the Government's most controversial proposals - to allow Parliament to dictate plans for controversial schemes including new airport terminals, nuclear dumps and motorways.

Despite the U-turn, today's planning reforms will remove the brakes from a major developments and new housing estates around the South-East, many of which have been held up for years by council planners. Mr Prescott will herald-the biggest house-building drive for 25 years as a chance to make homes affordable again for essential public service workers who have been priced out of the capital.

He will tell the Commons that part of £1.1 billion of extra money announced in Chancellor Gordon Brown's spending review on Monday will be used to subsidise new estates built by housing associations, providing at least 90,000 homes by 2006.

These will be strictly allocated to essential workers, following complaints that the average London house now costs seven times a teacher's salary. The homes will be available to rent or buy and employers may be asked to help pay for extra houses.

Three areas have been earmarked to bear the brunt of a rapid expansion in private housing estates as well, including the Thames Gateway, east of London, where 100,000 houses are due to be built. Other likely zones are Stansted in Essex, Milton Keynes in Buckinghamshire and Ashford in Kent.

Mr Prescott will set targets for a substantial share of the houses to be built on derelict land rather than open fields but opponents said it was inevitable that countryside would be concreted over.

Hugh Ellis, of Friends of the Earth, said: "Allowing big business to concrete over large parts of the South-East would be extremely bad news for local communities and the environment." Critics have also warned that the South-East will overheat even more and could not cope with an expanded population.

Planning reforms being unveiled today will prevent local communities blocking developments and are likely to be in place when Transport Secretary Alistair Darling decides where to locate a series of controversial new airport runways and terminals next year.