David Cameron also said plans would to rolled out to hand house builders thousands of acres of land to build on now and pay for the land when homes were sold.

Cameron pledged the Government would introduce bigger discounts for council tenants to revitalise the flagging right-to-buy scheme where take-ups have fallen since Labour reduced the discounts available.

“We need to do everything we can to fire up the engine of the British economy,” said Cameron in an interview on The Andrew Marr Show.

“We are going to make over Government land to house builders on the basis they can start building now and pay for the land when they sell homes.

“That could build another 100,000 homes and create 200,000 jobs.”

The scheme was first mooted in March by housing minister Grant Shapps in the hope of overcoming banks’ reluctance to lend for speculative housing projects.

He added: “We are not stopping there, we are saying let’s bring back the right to buy council homes with proper discounts that Labour got rid of and let’s use that money to buy new homes for low rents for families.

“That could provide another 100,000 homes and 200,000 new jobs.”