Without these workers the public services that support London's economic success could not function

Mayor Ken Livingstone

Average rents would be pegged between �80 and �180 per week, to make it affordable for workers earning less than �20,000 a year.

There could also be an option for residents to buy the flats.

It is hoped a pilot estate can be running within a year to test public opinion and determine the cost, quality and attractiveness of the flats.

Mini-suites can be sited on open spaces such as disused car parks or playing fields.

If successful, they are expected to be built on temporarily gifted land across London in the next few years.

London Mayor Ken Livingstone said they were not intended to be permanent accommodation but a source of much-needed housing for people on moderate incomes.

"Too many key workers cannot afford to live in London," he said.

"The London Development Agency is acting now with others to provide the high-quality, low-cost accommodation that is urgently needed for key workers.

Partnership project

"Without these workers the public services that support London's economic success could not function."

Education, health and transport workers would be targeted in the cheaper-housing scheme.

The project has been paid for by a London Development Agency grant under the Keep London Working initiative.

Research is also being carried out into accommodation and planning issues regarding affordable housing in London.

Suite test

Nurse Isabel Ryan tested the mini-suite, a self-contained home at the Ideal Home show in central London.

She said: "I'm doing a job that I love but it is difficult surviving as things are very expensive.

"These flats are lovely, modern, stylish and clean. I have lived in places for a lot more rent that are much worse.

"They have a professional feel about them and it is somewhere that I could feel like coming home to."

Miss Ryan, who earns �22,000 as a nurse at a hospice, rents a boxroom with friends in Clapham.