A £3 million plan to transform Keighley's former workhouse into new homes has been approved by Keighley planning sub-committee. The plans were approved subject to acceptance of conditions specified by planning officials.

Conditions of approval include amending the current plans and the laying out of an improved car park with better turning circle space.

Concillor Barry Thorne said: "The development will be a major step forward for people who are disabled or on a low income."

Keighley developers MB Housing applied for planning permission to provide 67 homes for people on low income, pensioners and the disabled. The ambitious scheme on the site of Hillworth Lodge, on Oakworth Road, will be jointly funded by MB and Keighley's Single Regeneration Budget.

The building, used until recently by Keighley College, was built in 1860 to house the destitute of the town. The existing building will be converted into flats and new homes will be built to the rear. All ground-floor homes will be accessible by wheelchair.

The completed housing complex, which will include courtyards and communal garden areas, will be managed by Northern British Housing Association. The Hillworth Lodge site was visited this week by Hilary Armstrong, the government's housing minister, during her tour of local regeneration schemes.

SRB chairman Andy Mudd, who accompanied Ms Armstrong, described Hillworth Lodge as Britain's most substantial affordable-housing partnership between the private sector, council and a housing association. He added: "We are very excited about it. It is a unique project and exactly what the government wanted."

MB Housing has been involved in several other social housing schemes in the centre of Keighley including an new "Urban Village" off Alice Street. The new buildings have been designed to reflect the traditional appearance of the complex and will be constructed in stone with slate roofs.

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