Cameron is now on the right track.

David Cameron's latest policy turn has restored some much needed credibility to Conservative thinking on housing supply. At the same time some truly frightening statistics on growing unaffordability have led the chancellor to boost intermediate and social housing.

If the Conservatives' anti-development stance at the last election was an embarrassment it has since become increasingly untenable as a succession of reports have highlighted the depth of the supply crisis. In about 50 areas, predominantly in the South-east, the South-west and East, households now need five times their income to cover the cost of the most basic starter home. If more homes are not built then two thirds of all 30-year-old couples will not be able to afford a home of their own in 20 years.

Against this background Cameron has drawn the only logical conclusion and reversed his party's resistance to housebuilding. Given that the party's stance at the general election was to oppose the government's housing expansion plans in the South-east and extend the green belt you have to admire his chutzpah. Nonetheless Cameron knows that if you are going to have to bow to the inevitable it is best to get it over with as early in a parliamentary term as possible.

There is, however, a sting in the tail for the government. There was a lingering hope in the upper regions of the ODPM that another Cameron flip-flop might see the Tories backing the planning gain supplement. Cameron has made it absolutely clear, however, that he will oppose the PGS, saying that it will add £9000 to the average cost of buying a new home.

His understanding of property economics looks a bit shaky but Conservative opposition could well be the coup de grâce for the PGS. All previous attempts to tax development have been reversed when there was a change of government and another general election has to take place before the PGS is up and running.

Tory opposition could be the final coup de grâce for the planning gain supplement

The government's justification for the PGS - that it would help fund the infrastructure that new housing and other development needs - is highly debatable but what is clear is that neither party has a convincing policy on infrastructure provision at the moment.

The government is pinning its hopes on its "cross-cutting intergovernmental review of infrastructure funding". The fact that hardly anyone I have spoken to has even heard of it does not fill me with eager anticipation.

In the meantime the government is rightly going down the route of bolstering shared ownership schemes. Social housing has also been boosted with 49,000 new units scheduled over the next two years. That represents an increase of one-third, but before anyone gets carried away, it only takes us back to the level of building in 1998/99. Only a sustained, long-term programme of increased house building will make any real difference.