Plans for the first of 2,500 homes on the Grove Airfield site have prompted concerns about how infrastructure grants will be spent.

Persimmon Homes wants planning permission for 500 homes in the first phase of a development set to double the population of the village.

Vale of White Horse District Council is relying on the airfield scheme, which has been delayed for more than five years, to ease its housing shortage.

The development, which will bring new roads and schools, is expected to take 16 years with the first 500 homes being completed within the first five years.

But concerns have been raised that Wantage and Grove may not get its fair share of Government infrastructure money, known as the New Homes Bonus, for shouldering most of the Vale’s new housing developments.

The Government gives the bonus cash to councils for every home they provide and it is intended to be spent on infrastructure to support new residents.

The Conservative district council needs to provide 1,000 homes over the next five years and will receive more than £9m for doing so.

It wants to put the cash in reserves and use it to plug holes in its budget.

But opposition councillors want a reassurance that money generated by Wantage and Grove development will be spent on projects in the area.

Frank Parnell, chairman of Grove Parish Council, last night welcomed the planning application, adding: “It’s good it is progressing. We have been waiting for far too long.”

But he said the cash earned from the development should be spent locally, adding: “The money that comes for the homes should go to the area that takes the homes. That’s what it for.”

The district council got £451,500 for new-build homes in the last financial year and is to get nearly £1m next year. Both sums will be put into reserves.

It expects to get more than £8m in the four following years, 60 per cent of which will be put in reserves and the rest used to fill funding gaps.

Leader of the council Matthew Barber said the homes money in reserves could be spent in the area at a later stage and the rest would be used to protect important council services.

He said: “The money is not ring-fenced by Government so we are free to use it, and it is essential the council supports its key services.”

But Lib Dem opposition leader Richard Webber said: “As much as possible should go to alleviate the problems new developments cause.

“People will rightfully be very angry if they see lots being spent elsewhere in the district with the money from their development.”

Another 1,500 homes are earmarked for a site at Crab Hill in east Wantage.

The council’s draft budget will be presented to cabinet on Friday before going to council for approval on February 22.

District council spokesman Andy Roberts confirmed Persimmon Homes had submitted an application but said the council was waiting for more information before considering it.