A REVOLUTIONARY plan to improve council housing in Bolton by borrowing hundreds of millions of pounds has been given encouraging signs from the Labour Party's annual conference.

But council housing chiefs say it is still too early to say whether their plans will find favour with the powers-that-be despite talk echoing the council's thinking at the Brighton conference.

Last week, housing bosses revealed plans to revitalise the town's stock of 22,000 homes by establishing a Community Regeneration Company (CRC).

The CRC would borrow nearly one billion pounds over a 35-year period to invest in council house improvements.

Executive member for housing Cllr Noel Spencer said under the present system they simply could not afford even immediate work to bring council homes up to "21st century standards" because of a lack of funding from the Government.

The proposal to establish the CRC would mean it could borrow cash from high street banks and finance houses above borrowing limits set for local authorities.

The council's Executive agreed for the proposed CRC model to be sent to officials within the Department for Transport, Local Government and the Regions (DTLR) in the hope it would find favour as one of a number of models for future investment in housing.

And while the council is still awaiting a reply from the DTLR, it was revealed this week that Prime Minister Tony Blair may be considering allowing councils the power to borrow more money to fund public services.

It is believed Mr Blair, in conjunction with public services union Unison, has agreed to a package to give councils greater borrowing power to fund housing, improve transport and maintain services such as libraries.

Transport Minister Stephen Byers has also accepted that the ban on town hall borrowing should be lifted.

He said: "Local authorities have huge assets but are not allowed to borrow on the value of them.

"We need to look at that again. We should give them the opportunity in a responsible way to raise money. We will introduce legislation to change capital rules and allow councils to raise additional finance."

Bolton Council director of housing George Caswell said: "This is a new initiative and there's very little information available about it yet. The detail could take some time to emerge.

"If it means that the council can borrow all the money that it needs to carry out the repairs and improvements to bring homes up to 21st century standards, and keep them that way, then we would welcome it".