In unpublished written evidence given to a House of Commons committee last week, the Countryside Commission hits out at what it says are "dogmatic" attempts to safeguard Green Belt "at all costs".
Rather than oppose controversial plans to build up to 10,000 homes in the Green Belt west of Stevenage, in Hertfordshire, the Commission is working with the local council to try to make them as environmentally friendly as possible.
The top Conservative and Liberal Democrat environment spokesmen both expressed alarm when told of the Commission's stance last night.
But the move will be welcomed by ministers, who are increasingly beleaguered by ferocious protests over their recent decisions to approve plans to build houses in Green Belt land around Stevenage and Newcastle. The pressure on ministers will sharply increase this Tuesday when the opposition initiates a full Commons debate to demand better protection for the countryside.
There are also signs that despite the recent DoE decisions, Mr Prescott is keen to lure developers away from the countryside by imposing taxes on housebuilders who want to build in the countryside. Such a levy would be resisted by the Treasury if it were proposed to use it to provide specific funds for urban regeneration.
Last Wednesday, more than 80 MPs and peers of all parties set up a formal group to campaign against the Government's plans to build houses in the countryside. And 69 of the Government's own backbenchers have already fired a shot across its bows by signing an Early Day Motion on the issue.
Meanwhile, radical environmental activists have threatened to transfer their protests from roads to house building.
Ministers believe that Britain will need at least another 4.4 million houses by the year 2016 and plan to build half of them in the countryside. They have promised to publish a green paper on the subject before Easter.
However, environment ministers are split. Deputy Prime Minister John Prescott wants to build the majority in towns and cities, but this is being resisted by his junior ministers, Richard Caborn and Nick Raynsford.
In evidence to the House of Commons Select Committee on the environment, transport and regional affairs, the Commission says: "There is now a danger that the protection of Green Belt is transferring pressure for development to protected areas which have been designated for reasons of natural beauty and nature conservation."
The Commission's case is that Green Belts, which were originally set up after the Second World War to prevent urban sprawl, are now often in the wrong place and prevent sensible development.
Rules against building on even the most spoiled parts of Green Belt are stricter than those in officially designated Areas of Outstanding Natural Beauty. As a result, houses are often pushed out into better countryside.
But yesterday Tim Yeo, the Shadow Environment Minister, said Green Belts were essential to stop urban sprawl and that he was "surprised" by the Commission's stance. "I think it is being very foolish," he said. "This is the agency that is supposed to protect the countryside. What does it think it is doing?"
Matthew Taylor, the Liberal Democrats' spokesman, called for a moratorium on building on the countryside while the Government reviewed its policies.
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