Telford & Wrekin Council could borrow £2 million to boost builders

The authority's ruling cabinet is proposing the scheme, which they say will create homes and jobs and boost the economy.

Council chiefs say the money borrowed will be clawed back through additional council tax coming in on the new homes, developers repaying loans and cash through the Government's New Homes Bonus scheme.

It will target housing schemes that were either not completed or never started because they became unviable as the value of land plummeted.

Known as "stalled sites", these are almost exclusively on brownfield land and are mainly located in Telford's borough towns.

Council bosses claim it is "unlikely" that work will resume on these sites for a considerable amount of time.

The pilot scheme being proposed will see funding of up to £156,000 and/or a loan being made available to a developer to help them complete their stalled development.

Developers will be invited to bid for financial support with chosen pilot projects needing to deliver more than 10 homes.

They must also be able to show they have exhausted all other funding routes.

Councillor Charles Smith, Telford & Wrekin Council's cabinet member for housing, development and borough towns, said: "The economic downturn in many ways has left councils with a unique set of circumstances to resolve and this is a proactive way of tackling the problem.

"By putting a fund in place to help developers to start building homes due to problems accessing finance, we will create a situation where everyone wins.

"It will mean housing schemes which have stalled are completed, more homes built and jobs created and it will all help to lift the local economy."

The proposal will be discussed at a meeting of the council's ruling cabinet tomorrow from 5pm at Addenbrooke House.