DEPUTY Prime Minister John Prescott said Burnley may be chosen as the guinea pig for a new government regeneration programme which could solve its empty housing crisis.

If given the go-ahead, the 10-year plan would see grants from central government being used to overhaul Burnley's empty housing.

The news was announced during Mr Prescott's visit to the Burnley Wood One Stop Shop yesterday. He came to see the work done by the volunteers who help run the community-based, owned and managed regeneration project.

The project was established in 1999 by members of the Burnley Wood Community Group. Mr Prescott was asked to visit Burnley Wood by the town's MP, Peter Pike who was eager for him to see first-hand how volunteers were tackling the problems and what was needed for the future.

As head of the Department of Transport Local Government and the Regions Mr Prescott is responsible for overseeing large scale regeneration programmes and lobbying the Treasury for the money needed to deliver them.

After meeting the volunteers and hearing a presentation on Burnley's housing problem from Burnley Borough Council's housing needs and strategy manager David Riley, Mr Prescott revealed that a 10-year plan of investment may be about to be instigated and Burnley could be the first town in the country to benefit from such a scheme.

At the moment, Burnley has almost 4,000 empty homes and the council estimates that it would cost somewhere in the region of £30 million to deal with the problem.

Mr Prescott said: "We will see what we can do about the problems in Burnley. I think there is an opportunity to deal with the problems and keep community spirit alive." He praised that spirit and the work of the volunteers. "We had a discussion for about one and a half hours, looking at the particular problems that people in Burnley Wood face. Initiatives like the Burnley Wood One Stop Shop are all about doing something for local communities and we want to back those people."

Although Mr Prescott insisted that yesterday's visit to Burnley was nothing to do with the Task Force, and refused to comment on their report, he said that the problem of poor housing could have played a part in the disturbances in the summer.

"When Tony Clarke completes his report we will look at what exactly we can do.

"We won't know what exactly needs doing until that report is completed."

Asked if Burnley would receive any extra money from the government to help tackle the housing problems, Mr Prescott would only say that it was "about getting resources. We have got to do more than simply find cash."

Pauline Law is the chairman of the Burnley Wood One Stop Shop thinks that the housing problem was slowly getting worse.

She said: "Because of the time it is taking for the houses to come down, people are getting fed up and moving out and we are ending up with more empty houses.

"The way he was talking was quite positive and it gave us confidence."

Peter Pike MP said: "It is very clear from everything that he is following up the things that I have put to him.

"He has not also been following things up, but has been keeping abreast of all the issues concerning Burnley.

"He's made it absolutely clear that he is going to come again when the Task Force report is out and in the mean time Lord Falconer, the Government's Housing Minister will also visit.

"The housing programme needs to be at least ten years and we must demolish about 2,000 homes and concentrate resources on the remainder."

Before returning to London yesterday, Mr Prescott gave a promise that he will return when the Task Force report is concluded.