Labour has called for all areas to receive greater Government backing after Whitehall shifted the focus of its housing cash.

A new Ministry of Housing, Communities and Local Government policy paper quietly published last month revealed Whitehall has earmarked at least 80% of £7bn cash from five key housing programmes for projects in areas facing the highest affordability pressure, leaving just 20% for the rest of the country.

One local government expert suggested Whitehall was ‘withdrawing support for some of the most challenged parts of the country’ and the policy would ‘unquestionably widen the north-south divide’.

Labour’s shadow housing secretary, John Healey, said: ‘There’s now a housing crisis in every part of the country. Yet Conservative ministers still have no plan to fix the crisis and deep cuts to housing investment since 2010 have led to the lowest level of new social rented homes since the Second World War.

'All areas need more backing to build.’

Greater Manchester mayor Andy Burnham said the policy would 'fuel the economy where it is already strongest' and called on the Government to 'think again'.

He said: 'It is simply indefensible to shovel billions of pounds of public money into the more affluent areas when all parts of England are facing a housing crisis. 

'Such a skewed distribution of public money is demonstrably unfair and unacceptable.

'Right now, the Government should be working hard to bring our country back together rather than widening its economic and social divides.' 

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