It will not be getting its hands dirty with council homes itself, but Cheltenham Borough Council has approved plans to look to borrow a cool £100 million to build new houses.

If all goes to plan the Gloucestershire local authority on the edge of the Cotswolds will borrow the money from the Public Works Loan Board (PWLB) to lend on to Cheltenham Borough Homes (CBH).

CBH is what is referred to as the authority's ALMO - or arm's-length management organisation is a private company, founded in 2002, which turned over more than £12 million last year.

The council would lend it the money as a higher rate allowing for a "a financial return" for the local authority.

"It is recommended that the council enters into a loan agreement with CBH, whereby the council would grant CBH a loan facility of up to £100m, each tranche to be repaid over 40 years. This loan would be backed by council borrowing, such as from the PWLB," said the proposal, which has now been approved by the borough council.

"Taking a long-term investment in Cheltenham will provide numerous social benefits whilst also providing a sound commercial investment, offering an ongoing return and growing asset base."

It is understood the plans were drawn up before the Government decided on plans to scrap the Housing Revenue Account (HRA) borrowing cap.

The cap has restricted how much councils can borrow against their housing revenue account.

CBH's vision is "to make Cheltenham a better place to live by providing great homes and stronger communities".

CBH's annual report filed in March this year said it had delivered services to an estimated 6,700 customers living in the 5,079 homes it manages.

In the 12 months covered by the report 26 of those council homes were sold under Right to Acquire (RTA). Nine new council houses were built and 11 homes added from what it describes as its "supply programme".

More than 50 per cent of those homes in its care are flats, almost a third are one-bedroomed, 36 per cent two-bedroomed and three per cent three and four bedroomed.

Plans are in place for 25 more homes in 2018/19 and "an ambition to build a pipeline of 350 new homes by 2020/21".

Also on the cards is its "ambitious project" called Cheltenham West Vision. CBH received a grant of £350,000 from the Ministry of Housing, Communities and Local Government to support a master-planning exercise on 1,200 homes.