THE outcome of a housing decision has provided a boost for a North-East brewery involved in merger talks with a neighbour.

The Government Office North-East revealed last night that Transport Secretary Stephen Byers's department does not intend to call-in a housing scheme on the Castle Eden Brewery site, in east Durham.

Providing Easington District Council approves the decision, it will allow Persimmon Homes to buy the site from Castle Eden to develop 70 houses and ten flats.

Castle Eden Brewery will, in turn, buy Cameron's Brewery at Hartlepool from owners Wolverhampton and Dudley Breweries, in a deal worth up to £5m. Under a new holding name, the Castle Eden and Cameron's Brewing Company, favoured brands of both, including Strongarm, Nimmos XXXX and Castle Eden Bitter, will be produced at the Lion Brewery, in Hartlepool.

It will also save the jobs of the Cameron's workforce of more than 100 and about 20 Castle Eden brewery workers transferring to Hartlepool.

A Castle Eden Brewery spokesman last night welcomed the decision not to call in the application, which could have taken up to a year to resolve if a public inquiry was called.

"The Government Office said they would do it in three weeks and they have, so we are grateful for that.

"We now await the final decision from Easington. We hope they can put it through their system as quickly as possible."

Part of the deal on the site will see tenant Durham Associates create up to 70 office jobs in the brewery buildings.

Hartlepool MP Peter Mandelsson is believed to have played a role in speeding up the consideration of the scheme by the Department of Transport, Local Government and the Regions.

He said last night: "I'm absolutely relieved and delighted this can now go through.

"The future of Cameron's depended on the sale of Castle Eden site and I'm glad the Government has acted sensitively and speedily."

Easington council leader Alan Napier said the proposals were now back in the hands of the authority's planning department.

"They will report back to full council. There are some concerns on site, including noise pollution with the proximity to the A19.

"Obviously, though, we will try to push things through as soon as we can," said Councillor Napier.