Scrapping EU-era environmental protections on nutrient neutrality will allow for an additional 100,000 homes to be built in England by 2030, the Government has said.

Environmental campaigners have criticised the planned change, but the Government says housing developments contribute only a small fraction of nutrient pollution and new funding is being provided to mitigate any associated increase.

The changes will see the financial burden to mitigate nutrient pollution for new housing shifted from developers to taxpayers.

The Government says it intends to work with the housebuilding industry to ensure that larger developers make what it describes as an appropriate and fair contribution to the scheme over the coming years.

No detail on that has been announced, but the Government said it is discussing how to do so with the Home Builders Federation.

The Government said it would double investment in its nutrient mitigation scheme, being run by Natural England, to £280 million. And an additional £166 million will be allocated for slurry infrastructure grants.

These new plans will cut nutrients and help support England’s precious habitats whilst unlocking the new homes that local communities need

The changes are being proposed via an amendment to the Levelling Up and Regeneration Bill which is currently going through the House of Lords, with the Government saying it could see additional homes being built in a matter of months.

Under legislation derived from the EU, Natural England currently issues guidance to 62 local authority areas requiring new developments to be nutrient neutral in their area, meaning developers must demonstrate and fund mitigation to win planning approval in certain areas. This requirement will no longer apply under the changes being proposed.

The Government describes nutrient pollution as an “urgent problem” for freshwater habitats, many of which it says are “internationally important for wildlife, and acknowledges it needs to tackle the issue to meet legal commitments to restore species abundance.

Housing Secretary Michael Gove said: “We are committed to building the homes this country needs and to enhancing our environment. The way EU rules have been applied has held us back. These changes will provide a multibillion-pound boost for the UK economy and see us build more than 100,000 new homes.

“Protecting the environment is paramount which is why the measures we’re announcing today will allow us to go further to protect and restore our precious waterways whilst still building the much-needed homes this country needs.

“We will work closely with environmental agencies and councils as we deliver these changes.”

Environment Secretary Therese Coffey said: “These new plans will cut nutrients and help support England’s precious habitats whilst unlocking the new homes that local communities need.

“We are going to tackle the key causes of nutrients at source with over £200 million of funding to reduce run-off from agriculture and plans to upgrade waste water treatment works through conventional upgrades, catchment approaches and nature-based solutions.

Who would look at our sickly, sewage-infested rivers and conclude that what they need is weaker pollution rules? No-one

“This builds on the key commitments made in our five-year strategy – our Environmental Improvement Plan – as well as our Plan for Water which brings forward more investment, stronger regulation and tougher enforcement to protect our rivers.”

Housebuilders have welcomed the plans.

Executive chairman of the Home Builders Federation Stewart Baseley said: “Today’s very welcome announcement has the potential to unlock housing delivery across the country, from Cornwall to the Tees Valley, where housebuilding has been blocked despite wide acknowledgement that occupants of new homes are responsible for only a tiny fraction of the wastewater finding its ways into rivers and streams.

“The industry is eager to play its part in delivering mitigation and protecting our waterways. We look forward to engaging with Government on the right way to do so, now that ministers are acting upon the arguments that builders both large and small have been making for so long.”

Policy director for Greenpeace UK, Dr Doug Parr said: “Who would look at our sickly, sewage-infested rivers and conclude that what they need is weaker pollution rules? No-one – and that should include our Government.

“Scrapping or weakening limits on chemicals from sewage and farm run-offs would be a sure sign that ministers have completely given up on saving our great waterways and the precious wildlife they host.

“Instead of allowing house builders to cut corners, the Sunak administration should make sure we have the right infrastructure to handle our sewage so we can build new homes without sacrificing our rivers’ health.”