Not enough on greenfield and too much power for councils.

Last month the chancellor announced the government's long-awaited response to Kate Barker's 2004 report. Simultaneously, the ODPM issued PPS3, its draft planning guidance on housing.

Nothing better exemplifies the Janus face of the government than the contrast between Barker's targets - 200,000 houses a year - and PPS3, which compounds every error of existing guidance and will ensure that output barely keeps up with present levels, let alone increases by one-third.

There are two overriding problems with PPS3. First, nowhere does it say that councils must aim to increase output on the scale announced by Gordon Brown, and it repeats guidance on brownfield supply similar to PPG3. This instituted the regime of "brownfield first", which resulted in gross exaggeration of brownfield capacity and contributed to record low levels of housebuilding.

In setting the brownfield target of 60%, PPG3 was largely silent on the remaining 40% of houses that had to be built on greenfield land, so planners and politicians largely ignored that source of supply.

PPS3 compounds this by reiterating the 60% target and then exhaustively listing the land and property sources that urban capacity studies dreamed up, in what many will take to be a clear indication that greenfield land is off-limits.

It is over-reliance on brownfield that has reduced our housebuilding levels. If our output targets are 30% higher, the question of what we do with our greenfield land is an even higher priority and needs clear policy guidance. But ministers seem afraid to grasp the nettle.

It is over-reliance on brownfield that has reduced us to current housebuilding levels

Two years ago the ODPM was sufficiently concerned about the effects of PPG3 to say that "brownfield first" did not mean "greenfield never". Those words, at least, must appear in the final guidance, otherwise the Barker announcements are pointless. This is the government's problem. Whereas output is a macroeconomic problem for the Treasury it is an academic question for an industry that is increasingly investing abroad.

The second problem with PPS3 is far from academic. Readers who have followed the saga will remember the "leaked draft" of September 2004, which proposed to allow councils to prescribe house type, product mix and the price of housing built for sale. The industry believed it had persuaded government that this was unwise (indeed, insane). Well, the industry was wrong.

No conclusion can be drawn from PPS3 other than that the government intends to give councils the power to prescribe how housebuilders are to risk their capital.

If the industry does not draw a line in the sand on this consultation, housebuilders may as well tell their shareholders they will henceforth be contractors, working for the government. Nationalisation, where is thy sting?