MAJOR building plans in Swindon could be put on hold as the credit crunch tightens its grip on the town.

Employees at George Wimpey's Windmill Hill office in West Swindon are threatened with redundancies, while other builders have also been hard hit by the recent fall in house prices.

And the slowdown in the housing market could have a big impact on the town's economy, according to the chairman of the regional planning group.

Former council leader Mike Bawden says the credit crunch could lead to a delay in the Front Garden development.

Building work is already in limbo on sites across the town as contractors react to the fact that homes may not sell.

Builder Paul Cook, who employs 11 men, said he will have to let his workforce go in four weeks.

"There are no other jobs for the men to go to," said Mr Cook, of Paul Cook Construction. "They will have to sit tight.

"We are normally booked up 16 weeks in advance at this time of the year but have only four weeks of work left to do.

"As soon as trade picks up we can start again."

The timescale of the 4,500-home Wichelstowe development is likely to be pushed back, according to Coun Bawden, who heads the planning arm of the South West Regional Assembly.

Coun Bawden, who has had meetings with developers during recent months, said: "Builders are telling me they are closing sites where it is appropriate.

"They are not starting new developments at this point."

He said builders at the former Princess Margaret Hospital site were finishing off what they had started and would hold off continuing.

Estate agents are also seeing a downturn in the building industry.

Simon Millin, an assistant branch manager at Andrews Estate Agents, said: "Some builders have stopped building in the northern expansion in Redhouse, for example.

"But it is mostly a case of slowing down, not stopping completely."

Manager Steve Hudson, from Allen & Harris, fears that cutbacks could mean demand is not met.

"The last thing we need is a housing shortage," he said.