JOHN Prescott's plans for thousands of new homes could call time on extra beer production. Shepherd Neame has warned it may have to cut production if water resources cannot keep up with steep growth in demand.

The 300-year old Faversham brewery is already cutting water use to what it calls "Sahara-type" levels. For hundreds of years, the company has been taking water from its own borehole sunk 200 feet into an aquifer under the Abbey Street site. It was the main reason why the brewery was established there.

Sheps, which has won awards for its green policies, used to take more than eight pints of water for every pint of beer. It has cut that to five pints and there are plans to produce Sahara-type beer with around four pints.

But the brewer says it cannot go any lower without compromising quality. However, as production rises, demand for water will intensify.

Sheps warned that if the company extracted any more water, there was a danger that the marshes north of Faversham and Graveney could drain, seriously damaging the habitat for wading birds.

Jonathan Neame, chief executive, said he did not want to do that. But he was worried what would happen if 100,000 new homes were built in Kent -- 30,000 in Ashford alone -- under proposals by Deputy Prime Minister John Prescott.

"If there is so much pressure on us not extracting more water, how on earth are all these homes going to get water," he said. He called on water companies to install meters in all homes as a matter of urgency.

"Unless they do, I can't see where it's going to come from. We can't brew beer without water and for us to expand, we need water.

"We would clearly be worried if the extra homes were taking out of our aquifer and reduced the flow into the aquifer."

He added: "The Government must take water into account. We need clarification from them about their plans to get water in, otherwise it could affect our business."