Newport Council will still press for a new hospital to be sited on the site of a former steelworks in Maesglas, despite the Assembly granting Planning permission for a residential development on adjacent land.

Yesterday, the Argus reported how outline permission for 575 homes to be built on land at Monmouthshire Bank Sidings was granted by Jane Davidson, minister for environment, sustainability and housing.

Network Rail submitted plans to Newport council in 2007 for a residential development on the land, which currently accommodates a maintenance and distribution centre for the rail network.

The company lodged an appeal with the Planning Inspectorate for Wales in May 2009 on the grounds that the council failed to make a decision within the time limit.

City leaders and Newport Unlimited opposed the plans when they were first submitted as they wanted a ‘Medipark’ to be created on the former sidings and land which once housed steel plant, Whiteheads. They wanted it to include a £300million specialist and critical care centre.

Due to the size of the site, the decision on the planning appeal was referred to Ms Davidson, who agreed with the planning inspector that outline planning permission should be granted, subject to conditions, including that there should be no more than 575 houses on the development and limiting construction work to between 7.30am and 6.30pm Monday to Friday, 8.30am to 1pm Saturday and no work on Sundays and Bank Holidays.

Newport Council leader Cllr Matthew Evans said the council believed the site needed to be planned comprehensively with the adjacent Whiteheads site to include a new hospital as well as housing.

He said: "Despite this decision, we will continue to press for the new hospital to be sited on the Whiteheads site as we strongly believe this is the best option for patients, visitors and staff."

He added that as the new hospital is now proposed to be built in phases, it would be less of a burden on the already-stretched ambulance service to build it close to the remaining facilities.