The biggest council house building programme for decades was ordered by Gordon Brown yesterday as he urged town halls to rescue the construction industry and help to kick-start the economy.

Treasury rules that have stopped local authorities from building social housing should be relaxed to allow councils to borrow more money and to keep the proceeds from rents and sales, the Prime Minister said.

The changes, which could be introduced within months, would help to reverse the dramatic fall in homes built by councils since Margaret Thatcher introduced the right to buy policy in the early 1980s. Last year only 375 council homes were built.

The Times

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