Bolton Council is to spend £2.65 million buying cut-price shares in Manchester Airport.

The money to buy them will not come from town hall coffers, but from a from a windfall.

This is a dividend the council will receive on the investment it already has in the company.

The go-ahead to buy at £1 a share - a price below the market value - was given at last night's Bolton Council meeting.

The airport is increasing its share capital to pay for major developments over the next few years including improvements to the two terminals and the creation of a second runway.

Mr Steve Arnfield, director of finance said afterwards: "It is sound financial sense to buy the shares being offered.

"It means we increase the value of our holding and in the future will attract real increases in dividends and capital value.

"These will help maintain and protect council services in the future.

Labour Cllr Michael Kilcoyne said it would be "absolute madness" not to buy.

Bolton is one of 10 former Greater Manchester Authorities which have a share in the airport company.

The council's original investment of £5.7 million in 1986 is now worth £12.5 million.

Manchester has a 55 pc share and the other nine have five pc each.

Council chiefs feared that if Bolton did not buy the extra shares, the borough's share in the company would drop compared to other councils.

All councillors agreed with the move apart from former Tory leader Cllr John Hanscomb.

He wanted the council to use the windfall to protect services which are currently threatened with cuts of £5.5 million.

"We are always hearing that this council is broke and you are having to make cuts in services. Well if you are broke, you cannot take up this rights issue. There is no point having an investment which you are never going to cash in."

But he was accused by Labour and Liberal Democrat councillors of "selling the family silver".

The council also agreed to spend £300,000 of its own money on extra shares if other Greater Manchester Authorities did not take up their options.

But Tory and Liberal Democrat councillors disagreed with this part of the decision.

Tory deputy leader Cllr Derek Shepherd said: "We are not prepared to dip into the revenue budget to buy extra."

Councillors were told that while the "book value" of the airport was £250 million, the real value was thought to be around £1 billion.

Labour Cllr Kilcoyne added: "It is highly unlikely that these extra shares will be available because anyone who turned it down would be absolutely foolish."

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