Winchester city residents say they are "devastated" by a secretary of state decision not to intervene in the controversial Minstrels building scheme.

Government housing minister, Jeff Rooker, has written to St Thomas Street residents to say that intervention in the council's decision to allow a modern block of flats in the city centre was "not justified", although he added that the case was considered important enough to "call in". This only happens where issues of regional or national importance arise.

But despite careful consideration, Winchester City Council's decision will not be overturned.

Mr Rooker added: "In almost all cases, the initial decision on day-to-day development control matters should be taken by the elected local planning authorities".

Winchester's planning committee last month approved the four-storey block of flats proposed for Little Minster Street.

The scheme, for six flats, will have a copper roof and metal-framed projecting balconies on the top two floors.

Protesters have threatened to buy parking spaces on the land to stop the development, erected a "cherry picker" to test the building height and collected over 800 signatures of people who disliked the plans.

After a long struggle against the city council, protesters saw the Secretary of State as their last hope in preventing the development, which they believe is out of keeping with the historic area.

The decision not to intervene has left them reeling, but they say they have not given up.

Martin Wilson, from St Thomas Street, said: "We were obviously devastated and we find it quite appalling. The Secretary of State appears to have gone into it in some depth. Now, what do we have left available to us?

"We are not going to go down quietly. Winchester is going to be irreparably damaged by this."

Both Huw Thomas, the architect and David Atwell, planning committee chairman, have expressed relief that a final decision has been taken.

Mr Thomas said this week: "I'm hoping that it's going to be one of the best pieces of architecture I have done. I have tried to show that it's actually based on medieval architecture around the town.

"It's very much part of Winchester. It's an abstract version of the buildings around it and I am not copying any other fashion."

Mr Thomas was responsible for the re-design of the Peninsula Barracks, in Romsey Road, Winchester, in the mid-'90s - work which received critical acclaim.

Of the Minstrels site, he said English Heritage believed the scheme would not badly affect the Cathedral Close. The City of Winchester Trust liked the design and council architects had backed it.

"Also, it has a shop, which some people forget. That will help regenerate the area," he added.