Northstowe near Cambridge will be delayed at least a year because of funding problems and project complexity

Construction of the government's prototype eco-town, Northstowe, will be delayed by at least a year because of the economic downturn.

The Northstowe delivery board said that the decision has been taken because of “unfavourable market conditions, the difficulty and cost of obtaining credit, and the complexity of the project”.

The decision means that the first houses will not be built in Northstowe, planned on the site of a disused airfield outside Cambridge, until at least the end of 2010.

Northstowe's partners - English Partnerships, developer Gallagher, local councils South Cambridgeshire District Council and Cambridgeshire County Council, and housing growth delivery body Cambridgeshire Horizons - have agreed to work together to continue to progress plans, despite the challenging economic climate.

Cambridgeshire Horizons has also submitted a bid to the government for more cash to make the development of 10,000 homes stack up.

Alex Plant, chair of the Northstowe delivery board and chief executive of Cambridgeshire Horizons, said that the delay reflects the time required to plan an exemplar new town as well as the difficult economic climate.

He said: “We hope that government can respond to our bids for additional pump-priming money for Northstowe, to enable this exciting development to move forward as quickly as possible.”

The news follows an admission by Plant in the summer that “tens if not hundreds of millions of pounds” of government funding was needed to allow the development to proceed to the high environmental standards envisaged.

The news also follows widespread speculation that the government is scaling down its formal eco-town process because of opposition to the developments.

Designs for Northstowe
Designs for prototype eco-town Northstowe