The number of homes built through the Housing Corporation's rural programme has halved over the past five years due to lack of funding.
In 1997/8, the programme, which targets settlements of fewer than 3000 people, completed 1664 units. By 2000/1, this had fallen by half to 847, although numbers rallied a little in 2001/2, with 975 homes supplied.

The drop reflects a cut in the approved development programme, although the corporation would not release specific figures for rural homes. In 1994/5, when funding was released for projects to be finished in 1997/8, ADP was £1.5bn. In 1997/8, ADP for projects due for completion in 2000/1, had fallen to £700m. ADP for 2003/4 is about £1.3bn.

The decline came to light in the Countryside Agency's fifth State of the Countryside report, published on Wednesday.

Fiona Cruickshank, Housing Corporation director of investment and regeneration policy, said: "Funding has now improved and the programme is back on a rising trend. We exceeded our approval targets of 1100 for 2001/2 and 1300 for 2002/3.

"The target for 2003/4 is 1600 and we are on the way to delivering this."