Donington Park has been given the go-ahead to begin work on a £100 million redevelopment of the circuit which is crucial to Britain keeping its Formula One grand prix next year.

North West Leicestershire District Council tonight agreed unanimously to grant Simon Gillett, the owner, planning permission to turn the venue into a state-of-the-art facility. Gillett now has 17 months to complete phase one of the project prior to Donington staging next year’s British Grand Prix.

Silverstone, which has staged the race since 1987, hosts the event for the last time in the foreseeable future this June after Bernie Ecclestone, the Formula One commercial rights-holder, became frustrated with the Northamptonshire circuit’s ability to implement the significant improvements that he demanded.

Ecclestone subsequently signed a 10-year agreement for Donington to stage the race from 2010, though he has been adamant that if the circuit is not ready there will be no race at all in Britain.

“Even if Lewis is world champion, we will simply say we will get on with the calendar and that England won't be included,” Ecclestone said last November.

Phase one of the work at Donington will see the track extended in line with FIA regulations, along with the building of a new pit and paddock complex, media and medical centres, clubhouse and suites at Redgate, Starkeys and Craner Curves.

Gillett’s plan is to raise the capital required for the building work via a debenture scheme, though this will clearly prove more difficult in the current financial climate.

“I’m over the moon.” Gillett said. “It’s the end of six years of hard work, and the beginning of probably six years more hard work.

“But I’m elated, relieved, all of the above. I couldn’t be happier, and from tomorrow morning it’s shovels at dawn and away we go.

“It starts in earnest now, and time to start focusing on 2010 and delivering the best grand prix in the world. That is what I’ve always said we would deliver, and that is what we are going to do.”

Cllr David Stevenson, chairman of the planning committee, remarked: “This puts the foundation in place for Donington Park to deliver a successful British Grand Prix in 2010.

“This will bring huge economic benefits to the East Midlands and the district of North West Leicestershire. It’s now crucial Donington Park turns its attention to the details that will make this event a success, including traffic management and public safety.

“In approving this planning permission we have done everything we can to mitigate any noise or nuisance this may cause to neighbours on site.”

The over-riding proviso, however, is that Gillett delivers on his key promise of the event becoming the first ’public transport grand prix’.

With access to Donington Park at a premium, Gillett is planning to restrict on-site ticketing, and instead impose a number of park-and-ride schemes around Leicestershire, Nottinghamshire and Derbyshire. It has led to Gillett and the district council entering into an agreement whereby if he fails to produce a workable travel management plan, they could impose an injunction.

“The traffic management plan is one of my biggest bugbears because it’s about my customers,” added Gillett. “If they don’t get in then they’re not going to come back and they are not going to have the experience I want them to have.”

Ecclestone is due to conduct an initial inspection in September, followed by world governing body, the FIA, next March.