Durham County Council plans to close 17 old people's homes with the potential loss of more than 350 jobs.

But the authority is planning five "extra care" schemes, four homes for mentally ill pensioners and an increase in services that will help elderly people living in their own homes.

The Labour council yesterday hailed the proposals, which will mean a net reduction of 236 beds, as a move away from "institutional" care.

The council says it faces a possible £60m bill to upgrade its 25 residential homes, mostly built in the 1960s, to meet new standards being phased in from next year.

Unlike councils such as Darlington and Newcastle, which have transferred their care homes to the private sector, Durham is taking what it believes is a pioneering approach.

Eight homes will be retained and five "extra care" schemes - modelled on one being built at Crook - will be built with non-profit-making partners such as housing associations.

These are aimed at people who need more support than sheltered housing but still want their independence.

New accommodation will also be built for dementia sufferers and intermediate care will be expanded to enable people to continue living at home rather than in an institution.

The council's executive committee met in secret yesterday and backed a consultation programme with unions, carers and their families. If they get final approval, the proposals will be phased in over three years.

The council, which has a no compulsory redundancies policy, will set up a task force to help home staff find other jobs.

Council leader Ken Manton said: "There will be no overnight closures. This is not something that can be achieved in one fell swoop."

Derek Little, of the GMB union, said of the plan: "It is forward looking and we welcome it in that sense.

"On the other hand we are worried about our members. We are looking to minimise the reduction in jobs."