Proposal for 2.5m more homes in rival Communities Plan

A radical and sweeping alternative to the Communities Plan has been set out by influential left-wing think-tank the Institute for Public Policy Research.

A quarter of a million homes should be built each year for the next 10 years and a raft of radical measures introduced to shake up social housing, the IPPR said.

Housing, Equality and Choice, published on Wednesday, criticised the vision for housing set out by deputy prime minister John Prescott's in February's Communities Plan.

The report said: "[The plan's] weakness is in its failure to integrate the housing proposals within a wider strategy for economic development."

Instead, the IPPR recommends that:

• authorities intervene to alter the pattern of housing tenure. New, overarching bodies called regional housing executives would commission social landlords to buy homes in areas of private housing. Social tenants would be offered the choice to move out of crowded urban centres
  
• first homes lose their exemption from inheritance tax
  
• full council tax be paid on second homes and higher bands of council tax be introduced
  
• regional development agencies in London and the South-east stop trying to maximise economic growth and let the other, poorer regions catch up
  
• the Communities Plan puts its housing policies into the context of wider strategies for regional development.

The Communities Plan fails to integrate the housing proposals within a strategy for economic development

Institute for Public Policy Research report

Chris Holmes, the report's author and a former director of homelessness charity Shelter, said: "We need an overall national policy to increase territorial justice and a better balance between people, homes and jobs, within which distinctive regional, sub-regional and local strategies can be developed."

Local government minister Nick Raynsford said the government would "look with interest" at the proposals.

The Communities Plan has also come under fire in a report from the Royal Institution of Chartered Surveyors. The RICS raised concerns that people will not want to move to the growth areas in the South-east. The report, released on 18 August, has been sent to economist Kate Barker, who is conducting a review of the housing market for the Treasury.

The Liberal Democrats intend to launch a "blue skies" review of housing at their conference in Brighton next month. The IPPR report will feed into this.