We'll have some of that social housing grant too, say three housebuilders

David Wilson Homes, Bellway and Taylor Woodrow said they were "emphatically behind" the plan, joining London developer St George, which nailed its colours to the mast last week (HT 4 July, page 16).

Barratt is also understood to be interested in receiving the grant, although no one there was able to comment as Housing Today went to press.

Terry Fuller, partnership director for Taylor Woodrow, which built 6300 homes in Britain last year, said: "We've spent public money before and feel we can be more effective than many RSLs in getting value for money."

Fuller said Taylor Woodrow received £400,000 last year from the Office of the Deputy Prime Minister to build 20 homes for teachers under the starter home initiative.

The company completed 36 homes earlier this year in Chelmsford using £300,000 and plans to use the remaining £100,000 to build another six homes.

We have been saying to the government: ‘Cut out the housing association. Pay the money directly to us

Terry Fuller, partnership director, Taylor Woodrow

Fuller said: "We have been saying to the government: 'Cut out the housing association. Pay the money directly to us, the housebuilders, and you will be cutting out the middlemen.' We will obviously need to make a profit, but associations take a 14% cut as well to cover their costs."

Fuller added that, having already received public funding, he was unconcerned about having to account to the government for how his company spent any money it received.

Brian Everett, housing initiatives manager for Bellway – which sold 562 units to housing associations last year – said: "We work with many of the most active housing associations and do not see that changing.

"We see receiving grant as a logical progression of the many homes developers build through section 106. We just see this as a level playing field."