A multi-million pound scheme to transform Blackpool's council houses could begin within two years - if tenants back it.

Blackpool Council wants to transfer its 5,500 council homes to an Arms Length Management Organisation (Almo) which will manage the homes on its behalf.

The Almo, run by a board of tenants, council representatives and independent members, would be able to access tens of millions of pounds of government funding to meet strict new targets.

Properties remain council owned - in contrast to the other alternative, a large scale stock transfer which would see a private housing association take over the council's housing stock.

Council chiefs say that, if successful, the Almo could provide more than 3,000 new fitted kitchens and bathrooms, 2,000 central heating systems and rewiring work for 4,700 homes.

To receive the funding the Almo would have to score at least two stars in an audit commission inspection - but town hall bosses say they are confident of meeting that target.

Cllr Sue Wright, housing portfolio holder: "I think over the years we have improved the service beyond all recognition. It is a real team effort and all of us are working to the same goal which is to provide better homes for our tenants. That is why the council has been unanimous in its backing for Almo.

"The government says this is the only way of achieving massive investment. If there was any other way we would have done it."

The council has also consulted staff and their unions and Cllr Wright says she believes staff will welcome the changes.

Unlike a full scale transfer of stock to a housing association, the council will not need to ballot all tenants in order to set up the Almo. It will, however, have to consult with tenants, a process which will be stepped up in the coming weeks.

The ALMO application will be submitted next spring and, if accepted, the first work could begin in early 2007.