Deputy Prime Minister John Prescott's office has told the Oxford Mail that although affordable housing and homelessness are key issues for the city it will not allow "wasteful" development on Green Belt land.
The message will come as a blow to the city council, which is pushing for land off Grenoble Road in Oxford to be freed up for housing.
A spokesman for the Office of the Deputy Prime Minister said: "New-build doesn't necessarily mean using up valuable green space. We are continuing to promote high-density development, which prevents wasteful low-density development on greenfield sites. We are also committed to using brownfield first where appropriate and have already met our national target for more than 60 per cent of new housing to be built on previously developed land. The Government has set a clear target for each English region to maintain or increase the current area designated as Green Belt land in local plans, including those regions containing growth areas."
A new South East Plan, which will supersede the county Structure Plan, will guide the South East England Regional Assembly (SEERA) on how many homes should be built in the region until 2026. The plan will allocate the number of houses, but actual sites will be decided by local authorities.
The city council's chief planning officer Michael Crofton-Briggs claims there are 1,200 homeless families living in temporary accommodation in Oxford -- the highest level outside inner London. More than 5,000 people are on the city council's housing waiting list and only 380 houses are being built each year when 1,800 are needed.
Mr Crofton-Briggs said: "The council is well aware of Government guidelines and has exceeded them by a substantial margin. The county council considers new houses should be built far away from the city beyond the outer edge of the Green Belt. The Government has stated there are times when a Green Belt location can be more sustainable than a more distant location. South of Grenoble Road is not wasteful use of the Green Belt - but a very sustainable location and fully justifiable use of about 0.5 per cent of the Oxford Green Belt."
Last week, the Oxford Mail reported that plans to review the boundaries of the Green Belt had been dropped by SEERA, over fears of massive housing development. The decision, by SEERA's planning committee - chaired by the leader of Oxfordshire County Council Keith Mitchell - gave a boost to Green Belt supporters.