Porter fine to go on cheap homes

New homes for key workers and low-income families will be built with the £12 million proceeds of the Dame Shirley Porter scandal, it was revealed today.

Westminster council has announced that £6.6 million will be invested in housing, with £4.3 million being held in its general reserve - enough to cut council tax bills by £43 for every household.

The final £1 million goes to the Audit Commission to settle its legal fees.

Dame Shirley, 73, paid the money last week to settle a decade-long battle over her role in the "homes for votes" affair, in which council homes were sold off cheaply in a bid to keep the town hall under Conservative control. She owed a total of £42 million but claimed to be worth far less.

Kit Malthouse, the council's deputy leader, said a number of housing projects would now be selected to benefit from the cash. He said council tax bills could be cut next year - although the authority may opt instead to boost services.

Mr Malthouse said: "We are very happy. We think it's a great result for the city."