The Heeley Road Hostel Group is opposing plans to dispose of land at the former vehicle maintenance depot site for the proposed development and claims the council's cabinet is selling it for less than its real value.

Bob Dagnall, group chairman, said: "We asked what the sale price would be, and were told this would not be made public because disclosing it would prejudice the commercial interests of the council.

"The cabinet decided that Muir would pay full market value for the land, and the same cabinet will then give this amount back to them as a grant.

"So in effect this same cabinet that last year overspent by more than £1m, that doesn't have enough money to keep our swimming pool open, and still wants to spend £7m on a new town hall, are now giving away a piece of land which our research shows to be worth between £400,000 and £500,000."

He said Coun Hayhurst instituted a call-in request.

"That call has been supported by another 14 councillors, and the decision is in effect now on hold pending an examination of the cabinet decision by a scrutiny committee on July 22."

The group says the matter will be discussed behind closed doors, but is calling for it to go before full council.

Coun Paul Rigby, portfolio holder for finance and efficiency, said: "In September 2007 the council agreed to dispose of the site for affordable housing purposes. However, at the cabinet meeting on June 26 it was decided to dispose of the site at market value to the Muir Housing Association. It was also agreed to support the development with a commuted sum payment from the council equivalent to the site value.

"National guidance and legislation recognises that local authorities should make better use of their existing assets and at the same time satisfy its obligations as a statutory housing authority by making them available to registered housing associations in order to facilitate such developments.This proposed disposal follows those principles."