The Office of the Deputy Prime Minister and the Treasury need to urgently address their divergent policies towards housing or risk missing the best chance to solve the housing crisis since the second world war, Duncan Maclennan, the Mactaggart professor of land economics and finance , has warned.
Delivering the address opening this year's annual Harrogate housing conference, the widely respected professor said the ODPM was too focused on spending public money, rather than looking at how efficiently it was being spent.

He said: "There is a gap between the ODPM and the Treasury's Barker review. The Barker review is about changing the relationship in government between different agencies to get more efficient working, whereas the Communities Plan is essentially about staying as it is."

The Barker review was announced by chancellor Gordon Brown last month to look at why the housing market isn't flexible enough to supply the country's housing needs.

He said that, although many of the policies of the Communities Plan were laudable, it failed to address the relationship between housing and the economy. He said a lack of investment in infrastructure had led to housing money being spent poorly – leading to market failure.

Maclennan told Housing Today after the conference: "The problem with the Communities Plan is that it doesn't address the issue of productivity. You have to look at why development takes place – for which you've got to look at things like railway lines."

Roy Irwin, chief inspector at the Audit Commission, acknowledged the gap between the Treasury and the ODPM, but said the distance was diminishing: "What you've got is the ODPM upping their game at an operational level, with the Treasury taking a more strategic look at things.

"They're not in tune but at least they're looking in the same direction – actually it turns out they're closer than they have been for some time."

A spokeswoman for the ODPM said: "There's much more to the Communities Plan than housing – it's about communities, creating places people want to live. These issues are being addressed."

After the reshuffle – Who’s where

Former housing minister Lord Rooker is to be given direct responsibility for ensuring the delivery of the Communities Plan.

His replacement as housing minister, Keith Hill, will take on Rooker’s former duties.

The new ODPM team and its responsibilities
Lord Rooker minister of state for regeneration and the regions

  • Nine market renewal pathfinders
  • Four growth areas
  • Homelessness
  • Regeneration
  • Neighbourhood Renewal Unit

Keith Hill minister for housing and planning

  • Thames Gateway
  • London
  • Further responsibilities to be confirmed

Nick Raynsford minister for regional governance

  • Regional assemblies

Yvette Cooper junior minister to both Rooker and Hill replaces Tony McNulty

Phil Hope junior minister to Raynsford replaces Chris Leslie