STALLED work on a flagship regeneration scheme will start within months thanks to a £5.8 million cash injection.

The Homes and Communities Agency (HCA) has stepped in to help revive plans for Hanley's £50 million Canal Quarter project.

The HCA's £2.9 million funding boost is being matched by Renew North Staffordshire to pay for vital infrastructure work on the 11-acre site between Lichfield Street and Eastwood Road.

The development, which includes up to 250 new homes and a brand new 40,000 sq ft Emma Bridgewater pottery works, has been on the drawing board for five years.

The existing Victorian pottery works, which was bought by Stoke-on-Trent City Council in 2007, will be converted into apartments and commercial units.

The project, which is part of the wider £275 million City Waterside housing regeneration scheme, will also feature canalside bars, shops and restaurants.

Hundreds of crumbling terrace homes have already been flattened to make way for the development.

But recession-hit developers interested in the site were reluctant to pay for site preparation work, including a 400-metre pedestrian link to the city centre, out of shrinking profit margins.

HCA board member Kate Barker, pictured, visited the site yesterday to discuss progress with regeneration leaders.

She said: "We are always looking to try to move on sites, which have become stalled because of the difficult market conditions.

"Stoke-on-Trent is a priority because a great deal of money has been invested in the city's housing pathfinder scheme and we don't want to see it go to waste. This money will encourage private developers to come in and build there."

But she added: "We are not writing blank cheques, and when we deliver funding we expect to see projects carried out."

Stoke-on-Trent City Council cabinet member for regeneration, councillor Brian Ward, said: "This will enable us to clear the site and prepare it and create the pedestrian thoroughfare to the city centre. Work should start in the spring and take about 12 months to complete. When it is finished, we can then hand over to private developers. I want this scheme to move as quickly as possible, but we have to go through the processes and the infrastructure is the most important process."

Emma Bridgewater managing director Stephen Hyde said the cash injection would accelerate the firm's move to its new premises.

He said: "We are working very closely with Renew on the building size and specifications for the factory, which will enable our production operation to be far more efficient and flexible."

Renew director Hardial Bhogal said his agency has so far spent £9 million on bringing the Canal Quarter to fruition.

He said: "What we are doing is creating the conditions and the confidence for the private sector to come and invest in this site. This is a flagship project for Renew in terms of creating a brand new vision of hope for local people and businesses."