CONTROVERSIAL plans to build a new £14 million school in Newport took a huge step forward after the Assembly approved a finance deal.

The replacement building for the crumbling Durham Road infant and junior schools is now set to open in May 2009.

The Assembly gave the green light to Newport council's full business case and will now give it £9.7 million of private finance initative (PFI) credits to build the school on the Glebelands playing fields in St Julians.

The council will pay Vinci Investments to design, build, maintain and operate the school over a 25-year-period, after which the council will have control.

But the council, governors and headteacher will be responsible for the day-to-day educational running of the school.

Assembly social justice minister Brian Gibbons, who approved the cash, said: "This is a long-awaited new school and I know our decision to invest will be welcomed by local parents."

"I am satisfied that delivering the new school, via a PFI scheme, will offer the best value for money for the council."

The new building will include a modern primary school with nursery provision, playing fields and an all-weather multi purpose games area with floodlighting.

The community will benefit from the facilities provided including new changing rooms, creche facilities and public toilets.

The development also includes new housing on the former Compton Webb Site, which is expected to include more than 150 properties.

Residents hve campaigned against building the school on the Glebelands, a former landfill site which they say is polluted with toxic waste.

But a council spokesman welcomed the news from the Assembly, which he called "an enormous milestone" for everyone involved in the project.

He said the authority will continue to work closely with residents living on or close to the access routes to the development site.

The PFI agreement and other contracts will be finalised with the developer as soon as possible so work can start on site.

David Bowler, managing director of VINCI Investments Limited, said the company has a proven track record of successfully delivering education projects.

Health fears have delayed project The Assembly initially gave its approval to the plans in 1999, and outline planning permission was given in 2000, despite the health fears of residents.

In 2003 the Environment Agency said soil tests and drainage at the site were "acceptable."

In 2004 the design, access arrangements and measures to prevent the contamination of groundwater were approved.

Officials insist the contaminated ground beneath the site will be cleared and guaranteed safe for 25 years, with an under-floor barrier planned, along with a soil capping layer.

Earlier this year preliminary work began to prepare the site.