The Chancellor's vision of building 400,000 new affordable homes could be derailed by the current skills shortage in the construction industry, the Federation of Master Builders (FMB) has warned.

Brian Berry, chief executive of the FMB, said: "Faced with some difficult decisions regarding public spending cuts, the Chancellor was right to 'choose housing' by prioritising investment in new affordable homes.

"Nevertheless, 'George the Builder' will need a new generation of 'real' builders to make his vision for housing a reality. We're already seeing housing developments starting to stall because the cost of hiring skilled tradespeople is threatening to make some sites simply unviable."

In the Spending Review, the government confirmed plans to build 200,000 starter homes with 20% discounts for under-40s, 135,000 shared ownership homes, 10,000 rent-to-buy homes and 8,000 specialist properties for the elderly and disabled.

This amounts to a £7 billion public investment in new homes, in an attempt to help more young people get onto the housing ladder.

Mr Berry warned, however: "Unless we see a massive uplift in apprenticeship training in our industry, there won't be enough pairs of hands to deliver more housing on this scale. That's why we're keen for the government to tread carefully when applying the new Apprenticeship Levy to the construction industry.

"The crisis of home ownership is inextricably linked to a crisis in house building. We therefore hope that in order to address both, the government will do everything it can to increase housebuilding capacity. The last time we built in excess of 200,000 homes in one year was in the late 1980s, when two-thirds of all homes were built by small developers. SME housebuilders now only build little over one quarter of all new homes, which points to another serious capacity issue – we need more small housebuilders to enter the market and also for SME housebuilders to crank up their delivery of new homes in order to build the Chancellor's 400,000 new affordable homes."