£1bn to build affordable housing
Ministers are to pump £1billion into a building programme in a bid to provide affordable housing for nurses, police officers and other key public-sector staff in the South-East.
The money will mean a near-doubling of the Housing Corporation's annual budget - the body used to channel funds to housing associations across the country.
The move is expected to be announced next week as part of Gordon Brown's longawaited Comprehensive Spending Review, which will set Whitehall budgets for the next three years.
Deputy Prime Minister John Prescott will then unveil the full details of the proposals, which have cemented a political alliance between him and the Chancellor.
Senior ministers have become alarmed by spiralling house prices in the South-East which are effectively preventing hundreds of thousands of key workers from getting a foot on the property ladder.
Mr Brown is sanctioning a massive building programme in four satellite towns: Ashford in Kent, Milton Keynes, Stansted and the Thames Gateway area, east of London.
A Treasury spokesman said that the Chancellor was worried about the "affordability" of homes for public-sector staff, many of whom earn less than £20,000 a year.
But the Tories warned that the plans could "plough through the green belt" and called for schemes to be confined to so-called " brownfield" sites - sections of land which have already been developed.
With little more than a week to go until Mr Brown announces his spending review, he is also looking at ways of raising cash to pay for his schemes.
He is said to be planning a "stealth tax" raid on middle and upper-income families by effectively cutting their child benefit for sons and daughters aged 16 and over. This would mean that the benefit would be means-tested; currently it is paid to all mothers with children up to 18 and in fulltime education.
The Treasury denied reports of the cutbacks, which it was said would help fund an ambitious plan to extend educational maintenance allowances across the country. The allowances pay up to £40 a week to those aged 16 and over from lower-income families if they stay on in further education to take A-levels or vocational exams.
Education Secretary Estelle Morris wants the allowances, which cover large areas of the country, to be extended nationwide in a move which could cost £600million a year.
Another measure expected to be announced next week is a £60 million scheme to encourage entrepreneurship among primary schoolchildren.
