George Osborne tries again to free up Green Belt land for housing

George Osborne provoked a backlash from environmental groups yesterday by promising to allow more building in the Green Belt as part of a new "go-for-growth" strategy.

As MPs return to Westminster today after their summer break, the Chancellor unveiled measures aimed at jump-starting the economy but at the same time stuck to his deficit-reduction strategy. David Cameron, Nick Clegg and Mr Osborne will make a series of announcements over the next two weeks in what will be seen as yet another relaunch by the Government. The centrepiece will be a plan to guarantee up to £10bn of new housebuilding by housing associations and private developers, and there could be more help for first-time buyers.

The Coalition's most controversial move will be to reignite a row with green campaigners by making a second attempt to streamline planning rules. Although Conservative MPs are clamouring for a stronger growth strategy, many will face opposition among their constituents over plans to build in previously protected areas.

Mr Osborne said he wanted local authorities to do more "land swaps" under which they can allow building in the Green Belt around towns and cities if an equivalent area of land elsewhere is safeguarded. He added that new roads should be built more quickly than the time it took to fight a world war. The scope and length of appeals against planning decisions is likely to be curbed.

The Chancellor told the BBC's Andrew Marr Show: "I think we can speed up planning. It is absolutely ludicrous that it takes years to get planning decisions in this country. This country, in the current economic environment, cannot afford to wait years for development."

Mr Cameron promised his party strong leadership in the new political season, saying he would tackle the "nimbyism" which saw people demand more housing as long as it was not in their own back yard. "Frankly, I am frustrated by the hoops you have to jump through to get anything done – and I come back to Parliament more determined than ever to cut through the dither that holds this country back," he wrote in the Mail on Sunday.

But green groups which won concessions over the Government's previous attempt to rewrite planning laws warned that it had another fight on its hands. Shaun Spiers, the chief executive of the Campaign to Protect Rural England, said the Coalition's pledge to protect the Green Belt appeared to be cracking. He said: "Building on the Green Belt is often justified by claiming that there is a shortage of other land available for development, such as previously developed 'brownfield' land. However, government figures show that the amount of brownfield land becoming available for re-development is far outstripping the rate at which it is being used and there is enough available for 1.5 million new homes."

An Infrastructure Bill will be fast-tracked through Parliament by next month, allowing the Treasury to guarantee £40bn of construction projects held up by lack of finance, including the £600m Mersey Gateway bridge.

Mr Osborne announced a Small Business Bank to bring together what he called an "alphabet soup" of government schemes to help small firms. But the move stops short of Liberal Democrat calls for the Treasury to turn the taxpayer-owned Royal Bank of Scotland into a state investment bank to lend direct to companies.

Tory right-wingers will urge the Government today to go "further and faster" to create growth. David Davis, who will make a speech on the issue, called yesterday for more spending reductions to fund tax cuts. "The Coalition's cuts should have been earlier and deeper," he said. "There is an alternative economic policy."

Labour dismissed the Chancellor's package as a rehash of previous announcements and said he was sticking to a failing economic plan.

Kickstarters coalition growth policies

Planning

Decisions on planning applications to be speeded up. Councils urged to allow building in Green Belt through "land swaps" by safeguarding currently unprotected greenfield sites.

Infrastructure

Bill to be rushed through by next month to allow Government to guarantee up to £40bn of nationally significant, ready-to-go building projects stalled by lack of finance.

Housebuilding

A £10bn Treasury package will guarantee the debt of housing associations and private developers in bid to create jobs and revive housing market.

Airports

Independent commission to review need for more airport capacity – including possible third runway at Heathrow. Could pave the way for U-turn on Heathrow by David Cameron at the 2015 election.

Small business bank

Government-sponsored bank to improve efficiency by bringing under one umbrella different schemes to help small companies start and grow. No extra money earmarked.