Observations on south-east development by Julie Foley

It may seem perverse to claim that the south-east of England could be classified as a "semi-arid" region when parts of Kent and Sussex seem hardly to get through a winter without severe flooding. Yet the region has less water available per person than many African countries. Abstraction levels are 10 per cent higher than the available water supply.

Across England and Wales, households use on average 155 litres of water per head per day; in the south-east, the average is 214 litres. And climate change, according to the Hadley Centre for Climate Prediction, is likely to make droughts in the region more frequent.

Not that flooding is likely to become any less common. According to the Environment Agency, more than 380,000 homes and businesses are at risk from flooding from the sea, rivers or groundwater in the southern region. In an extreme weather event many more people and properties would be affected.

It is against this background that one ought to view pressures to build new housing in the region. John Prescott proposes to build 200,000 homes in the Thames Gateway, Kent, Milton Keynes and around the M11 corridor as part of the government's Sustainable Communities plan. But the failure to consider whether water supplies could keep pace with such developments, or to take flood risks into account, makes the plan anything but "sustainable".

Ashford - one of the growth areas where 31,000 new homes will be built by 2031 - is already at risk from flooding. Regional flood defence measures will almost certainly have to be enhanced, thus increasing housing development costs. It would seem to defeat the purpose of building so many new, affordable homes for key public sector workers if they end up being charged high insurance rates for living in flood-prone areas.

The south-east is one of the most prosperous regions in the UK, with employment rates higher than in any other region. But with this success come huge social and environmental challenges. There is a growing awareness among politicians that there must be limits to our consumption of natural resources, such as water, and available land. These limits are already apparent in the south-east. The challenge will be to identify ways of doing more with less and to "decouple" the benefits of growth, in terms of opportunities and living standards, from the unwanted impacts on the environment.

We also need to ask hard questions about whether further growth in the south-east will exacerbate regional economic disparities. There is a case for shifting the pressures for growth to lagging regions in the north where there is more room for housing, and fewer constraints on water supplies.

Julie Foley is a research fellow in sustainability at the Institute for Public Policy Research, which launches a commission on sustainable development in the south-east this year

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