Rachel Reeves has promised to “get Britain building again” by bringing back compulsory housebuilding targets as part of a wide-ranging plan to reboot the UK economy.

In her first speech as chancellor, Ms Reeves also said she would overhaul planning restrictions and end the effective ban on onshore wind farms in England in order to speed up national infrastructure projects.

She said the government would make the “tough” and “hard choices” to fix the economy, adding that the UK had lagged behind other developed nations for years.

She confirmed Labour planned to build 1.5 million homes in England over the course of this parliament, but said it was not a “green light” to any kind of housing development.

“The question is not whether we want growth, but how strong is our resolve? How prepared are we to make the hard choices and face down the vested interests?”

Former Bank of England economist Ms Reeves was appointed chancellor on Friday, after Labour’s landslide election win.

She and her team worked through the weekend on the speech to business leaders and investors who have held back on investment in Britain in recent years amid the political chaos of the post-Brexit years and the Liz Truss mini-budget.

It is hoped her plans will unleash tens of billions of pounds of investment in green industry and housebuilding.

Ms Reeves made a pitch to investors who might have avoided the UK in recent years by promising stability.

“After 14 years, Britain has a stable government – a government that respects business, wants to partner with business and is open for business,” she said.

Speaking to business leaders at the Treasury, Ms Reeves said:

• Planning decisions for major infrastructure projects in Britain will be made nationally rather than locally in an attempt to stop important projects becoming tied up in years of red tape
• Green belt boundaries will be reviewed to prioritise brownfield and so-called “grey belt” land, which are poor-quality areas in the green belt such as disused car parks or areas of wasteland
• The transport and energy secretaries will prioritise decisions on infrastructure projects that have been “sitting unresolved for far too long”
• Additional planning officers will be recruited to speed up the planning process
• The former governor of the Bank of England, Mark Carney, has completed a report on the establishment of a new National Wealth Fund and Labour will announce next steps soon

However, warning of the challenging circumstances inherited by the party, she said that she had ordered an assessment of the country’s public finances and would present the results before parliament’s summer break. A full Budget would then be held this autumn.

“I have repeatedly warned that whoever won the general election would inherit the worst set of circumstances since the Second World War,” she said.

“What I have seen in the past 72 hours has only confirmed that.”

Ms Reeves said that under the plans, the “right mix” of affordable housing and homes for social rent would be built.

Deputy Prime Minister Angela Rayner will oversee this, taking an “interventionist approach” to make it happen, she added.

Labour will also overturn rules brought in by the Tories in 2015 which effectively meant that a very small number of objections could block new onshore wind projects.

It should lead to hundreds of new turbines being built, but Ms Reeves conceded that there would be opposition to her infrastructure plans.

“I’m not naive to that, and we must acknowledge that trade-offs always exist,” she said.

“Any development may have environmental consequences, place pressure on services and rouse voices of local opposition, but we will not succumb to a status quo which responds to the existence of trade-offs by always saying no.”

Liz Leffman, the Liberal Democrat leader of Oxfordshire County Council, told the BBC’s World at One that her party did not support housebuilding targets.

She said it should be up to local authorities who know their areas well to assess where housing needs to go, with input from residents.

“I’m hoping Rachel Reeves and the new Labour government will recognise just how important it is to get infrastructure in place first, because if we don’t do that that’s going to affect productivity and it’s also going to make it very difficult to attract people to buy those houses and come and work in the area.”

Proponents of compulsory housebuilding targets say they are necessary to make sure councils build the number of houses required.

Opponents, though, say the mandatory approach has been tried unsuccessfully for decades and it risks forcing development on greenfield sites against the wishes of locals.

The Conservative government under Boris Johnson set targets for housebuilding in 2019, but these were ditched when Rishi Sunak became prime minister amid objections from Conservative Party members.

Last year his government nevertheless estimated that it had built one million new homes in the last five years.

In the absence for now of a surge of public money, Labour will need the private sector to deliver its homebuilding plans.

Trade group the Home Builders Federation called for more support for people to get on to the housing ladder, including the return of a government support scheme for first-time buyers.

“Ultimately, builders can only build if buyers can buy,” he said.

David Barnes, head of policy and public affairs at the Chartered Institute of Building, said: “While we welcome the government’s plans to build 1.5 million homes throughout the next parliament, they must be realistic about the significant lack of skilled workers the construction industry has to deliver such ambitious targets.”

Lizzie Bundred Woodward from CPRE, the countryside charity, said that while it was “wholly supportive” of the housing plans, it wanted more clarity on where new homes would be built.

“We know there are 1.2 million brownfield sites available across the country that could be easily built on before we eat into the green belt,” she said, referring to the charity’s own research.

“There are also around one million homes that have been granted planning permission since 2015 that have still not been built out. So we would like to see the government prioritise those before building on the green belt.”