PLANS for a £350m, 845-home development near Eaglescliffe suffered a setback yesterday.

However despite Stockton Borough Council's planning committee's eight to four vote against the plan for the former Ministry of Defence site, planners will discuss thematter with the applicant before a further vote.

Councillors were concerned that businesses, and nearly 300 jobs, would be forced off the Allens West site if planning permission was granted.

However, Prism Planning, which has submitted the plans on behalf of landowner Eaglescliffe Ltd, said that 7,700 jobs would be created during the construction phase, and another 200 at a care home and shops.

Planning officers recommended the plan be approved, but councillors, who also heard concerns about the impact on schools and traffic, rejected it. Councillors decided they were "minded to refuse", but said further negotiations would go ahead with planners and the matter would be discussed again.

Plans were approved in 2008 to build up to 500 homes on the land, but the previous owner went into administration. James Wharton, the Tory MP for Stockton South, who lives in Eaglescliffe, said after the meeting: "Stockton council is right to take care and ensure it gets this right.

"Our roads are already congested and additional building will put pressure on local amenities."