Plans for a $39 million combined Defence and private housing development in Weston have been referred to a parliamentary committee for scrutiny.

Member for Canberra Gai Brodtmann said the federal government's plan to build 120 houses and units on an 8.3 hectare site bounded by Heysen Street and Unwin Place demonstrated its commitment to Canberra.

Special Minister of State Gary Gray said work on the site owned by Defence Housing Australia was expected to begin in January next year and be completed by December 2014.

''The development of the site involves the provision of infrastructure of 73 single-dwelling lots, of which 50 will be used by Defence families, plus three multi-unit sites which are expected to yield up to 47 dwellings,'' Mr Gray told Parliament.

''The first stage will provide this infrastructure and involves the design and construction of roads, stormwater drainage, sewer, water, natural gas, telecommunications and electricity. Once the infrastructure is completed, construction of the 50 dwellings for Defence will be undertaken.

''The remaining sites will be sold for complementary development.''

Ms Brodtmann said the proposed development was another example of the federal government's investments in Canberra.

''I've been a strong advocate for more investment in Canberra, and this development will support [Defence] families and open up other opportunities for the Molonglo area,'' she said.

House of Representatives Public Works Committee chair Janelle Saffin said the development would enable the replacement of houses that were at the end of lease or do not meet current standards.

The site is two kilometres from the Australian Defence College.

''This development aims to meet the needs of the broader Defence community and will provide an important accommodation option for personnel attending the [college],'' Ms Saffin said.

''It is the committee's role to review the proposed development and construction of housing at the Weston Creek site, to ensure the project meets its desired purpose and represents value for money for the Commonwealth.''

The total cost of the project was expected to be $39 million, not including the land.

The cost would be recovered through sale of individual lots to the general market and through a sale and lease-back program.

Defence Housing obtained the property through a land swap with the ACT government in 2009.

Mr Gray said the opening of land in the greater Molonglo area was enabling Defence to secure land and develop housing that would meet its housing needs.