JOHN McDonnell MP is threatening legal action after councillors agreed a £25 million Terminal 5 compensation package from the British Airports Authority.

The package, approved on Thursday last week, is intended to boost the economy, help the environment and provide extra housing, and includes a £500,000 payment, for the next four years, to establish a Community Trust.

But a decision to use only part of this payment for the Trust has outraged the Labour MP, who went on to accuse the Tory administration of using it to reduce Council Tax.

"They have stolen from our coffers and we are looking to take legal action," he said. "It wasn't allocated to Hillingdon to put in their kitty, so it's theft."

But council leader, Cllr Ray Puddifoot, was unmoved by the threat of legal action, pointing to a letter from BAA which states that 'the payment of £500,000 is to be used at the council's discernment'.

"We will not need to spend all the money on a Trust as it will cost £150,000 at most to set it up and run it for a year," he said.

"The council must do whatever it thinks is appropriate, and if Mr McDonnell wants to take legal action, then it is his perogative."

The majority of the compensation package will be used to benefit the borough and includes a contribution of £1 million for 15 years towards improving the economy and the environment.

A further £2.5 million will be put towards the provision of key worker housing, but the package has drawn further criticism from other members of the community.

Kelly Dundaven MBE, chairwoman of Longford Residents' Association, believes it is not enough.

She said: "I am not happy with the amount they settled with from BAA. They have not gone into the deal properly enough and have grabbed whatever was on offer.

"When work begins in Longford it's going to look like a building yard and that will be horrific, so it's not sufficient."