At a stormy council meeting on Monday night, councillors approved plans for the Cattle Market re-development, which includes a new hotel, park and community centre.

The town's Conservative party slammed opposition councillors who had asked for the plans to be tweeked following concerns about increased traffic and the effects on local businesses.

Council Leader Craig Humphrey warned that such a delay could scupper the deal and leave the area a permanent eyesore.

He said: "I don't want another Chapel Street situation. Not under my stewardship.

"This is a key site for Rugby that we've been discussing since 2006. In the current financial climate it's been difficult to get a company to commit to a re-generation project.

"If the developers were to pack their suitcases and walk away there wouldn't be a long line of developers for this."

The multi million pound re-vamp will include a Tesco mini-supermarket, a 72-bed Travelodge hotel, an 80-bed nursing home, community building, large park and dozens of new homes.

It was granted outline planning permission last year but the decision to award full permission was referred back to the council after concerns were raised by some councillors.

Cllr. Ish Mistry (Lab, New Bilton) said: "There's already traffic chaos in Mill Road – this will make it worse. It will be a mess.

"The plans need tinkering. We're not looking at a short-term project here, this will be a key site for 50 years or more."

The plans were voted through by a majority but the decision has not pleased a number of local business owners.

Jaspal Singh, owner of The Carlton Hotel and Restaurant in Railway Terrace, said: "This development is a disaster for the area and for Rugby as a whole.

"Our town is being systematically cheapened with supermarkets and budget hotels. They had a chance to make the old Cattle Market site a great gateway into Rugby and they've blown it.

"More jobs will be lost than created by this scheme and I can see some well-established guest houses and hotels closing.

"The powers-that-be just haven't listened to our concerns at all."