A TEESSIDE council is to challenge a regional planning blueprint which would limit house-building in the town.

Middlesbrough Council leaders claim the Regional Spatial Strategy fails to address their ambitious plans for the town.

Mayor Ray Mallon said: "It is looking at where Middlesbrough is now, not where we want to be in the future. It does not take into account the ambitions we have for this town."

The strategy has been launched by the North East Assembly and sets out policies for the regional economy, leisure and retail developments and housing for the next 15 years.

It says Middlesbrough needs 300 new houses per year up to 2011, but the council says that 350 a year are needed to take account of plans for Middlehaven and the regeneration of Middlesbrough's inner areas.

Councillor David Budd, executive member for regeneration, said: "We do not want to put artificial limits on our efforts to create wealth and attract people and jobs to Middlesbrough and the whole Tees Valley."

The mayor said that Middlesbrough had to reverse the trend which had seen the town's population drop, from 160,000 25 years ago, to its current 139,000.

He said: "We have to stem the flow of people from Middlesbrough. It is vital for the local economy and vital for services as the rate support grant which the council receives is based, first and foremost, on a head count.

"The decline in population is costing us millions. We need to attract jobs and people and, to do that, we need a better mix of housing and new housing."

The assembly is currently consulting on the strategy and there will be an examination in public on its proposals next spring. The final plan will be published in February.