John Prescott has pledged to put sustainable communities at the heart of the government's housing strategy.

In a statement on how his department will spend its spending review budget allocation, the deputy prime minister said he would be spending £38 billion over the next five years.

The Cabinet minister admitted there was "a great deal more to do" but pledged a renewed drive to improve social housing.

"This spending review will allow us to move up a gear," he told MPs.

A new community infrastructure fund worth at least £150 million will finance infrastructure around new housing developments.

And the housing budget will rise from £5.9 billion this year to £7.2 billion by 2008.

Prescott said the planned boost to sustainable communities would be helped by reforms of the planning system.

The aim was to  build an extra 200,000 new homes in the growth areas, he said, while there would be a doubling of departmental expenditure on growth areas outside the Thames Gateway region.

Prescott also pledged that by 2008 some 2.5 million people will have benefited from Labour's "decent homes" programme of refurbishments.

"Our drive to create sustainable communities is about more than a roof over people's heads," he said.

"It is about people taking pride in the place where they live so they can feel confident and secure in their own neighbourhood."

He added that creating sustainable communities was "not simply a task for government" and said partners in the public and private sector were delivering real change on the ground.

Responding for the Conservatives, Bernard Jenkin said council taxes would continue to rise under the plans announced by chancellor Gordon Brown on Monday.

And he also raised doubts about whether promised efficiency gains could be achieved.