London mayor Ken Livingstone will require an extra £150m a year in government subsidy to meet ambitious housing targets set out today in his draft plan for the capital.
The document, called London Plan, presents the mayor's proposals to handle economic and population growth until 2020.

Livingstone wants 23,000 homes to be built in London each year, 11,000 of which should be affordable.

Two-thirds of all boroughs would be required to introduce a 50% affordable housing quota on developments – 35% of development would be for social housing and 15% for key workers.

The mayor believes that the only way to meet these targets is to increase government subsidy to £600m a year. The Greater London Authority is talking to the Housing Corporation about increasing the allocation as part of the Treasury's comprehensive spending review, which is to be announced next month.

Eleanor Young, Livingstone's planning adviser, conceded that it w as crucial that the subsidy was increased. She said: "[Without extra funding] the targets will be more difficult to achieve."

We must deliver higher levels of affordable housing through the planning system

London mayor Ken Livingstone

Livingstone said: "My priorities are clear – we have to deliver higher levels of housing and affordable housing through the planning system and focus on the needs of key workers or people on moderate incomes as well as those needing traditional social housing."

Deputy mayor Nicky Gavron said the plan was to make London a compact city. She said: "We are looking at higher densities right across London." Gavron ruled out the possibility of building on green belt and metropolitan open land.

She said deprived areas of east London had been earmarked to receive most through regeneration. She said: "We are prioritising the East Thames Gateway and guiding public investment there."

The plan identifies sites for clusters of tall buildings such as the Isle of Dogs and Paddington.