Warwick District Council planning committee approved health company Circle's proposal to build a 30-bed hospital on land off Stratford Road in Warwick at its meeting on Tuesday.

It hopes to open in 2010, investing around £50 million in the 6,500sq m site, creating 190 full time medical posts and 200 construction jobs.

The plans had caused controversy because of fears the private firm might compete with the NHS for operations and money.

Warwick Hospital chief executive Glen Burley was among those who opposed the private firm - but the hospital withdrew its objection after Circle altered its business plan.

But some councillors still had misgivings. Coun Ann Blacklock (Lib Dem, Kenilworth Abbey) said: "This is a very speculative application because nobody, including the applicant, knows what the healthcare market will be in five, 15 or 20 years' time."

She also cast doubt on Circle's projected employment figures, saying the suggested 45 consultants would not be full-time, but would pay "flying visits" and that many nurses would also be part-time.

Coun Blacklock added that Warwick Hospital was close to meeting its waiting time targets and did not pay for many services to be provided by other organisations.

She admitted she could find no reason in planning policy to refuse permission but added: "I'm not sure this is going to be a viable concern."

Conservation group the Warwick Society had questioned the number of jobs that would be created on the land, which is set aside for employment, but head of planning John Archer said a hospital would create more jobs than a warehouse of a similar size.

Coun George Illingworth raised a concern that the site and its access road would need to be raised to comply with national flooding guidelines.

Others felt Warwickshire's ageing population and government policy to increase choice meant there would be a need.

Coun Roger Copping (Lib Dem, Leamington Manor) said: "Patients are travelling as far as Kidderminster to have hip replacements done. It would be better to have more facilities in Warwickshire.

"I am sure there will be a lot of work for hospitals in the future."

Coun Elizabeth Higgins added: "I am sure it would be well used."