Campaigners have claimed victory after plans to turn a leafy lane in Mill Hill into a major highway were rejected by a Government planning inspector.

In a report released last week Inspector Douglas Machin rejected the “thin, contradictory and unconvincing” evidence for bulldozing Sanders Lane as part of a plan to create 2,000 new homes on an adjacent site.

In June it emerged that Barnet Council had included a proposal to convert the pedestrianised lane into a highway in its Mill Hill East Area Action Plan (AAP).

The council and GLA-backed plan, which was otherwise approved by Mr Machin, will see new homes, a primary school and health facilities built on and around the Inglis Barracks site, creating an estimated 500 jobs.

Residents reacted angrily in June when they found a reference to Sanders Lane only when scrutinising the plan at the eleventh hour, prompting a last-ditch campaign joined by residents, ward councillors and Hendon MP Andrew Dismore.

They were dismayed at the potential loss of a public amenity that boasts an abundance of wildlife, is part of Barnet’s network of nature trails and is used by children to walk to school.

Mr Machin held an examination in public at Barnet House in October to which members of the Save Sanders Lane campaign submitted evidence.

In his report Mr Machin acknowledged the weight of public feeling and wrote that the council had not made the case for reopening Sanders Lane as part of the development and its inclusion made the AAP unsound.

Valeria Acerbi, 42, a mother-of-two who lives in Sanders Lane, said: “This is a little victory. We’re very happy that we’ve been able to bring it to the attention of the public that the council tried to throw this in with a plan that it had nothing to do with.”

Liberal Democrat councillor Jeremy Davies said: “I think this is a vote for common sense. I’ve been down to look at that lane a number of times and the more I look at it, the more I think this plan is a white elephant.

“It’s excellent news for the residents and just shows what an excellent campaign they’ve run.”

However, after the campaign was launched it also emerged that the council had included the creation of a new highway as part of its corporate plan, a document outlining its policies, to improve east-west transport links across the borough.

The revelation provoked criticism that the authority had acted “sneakily” by not informing affected residents, and also raises the prospect that the plan could be revived in the future.

A council spokesman said the creation of a highway was only one option it had suggested for ameliorating the increased traffic that will come with the development.

“We were not attempting to provide evidence in support of this idea,” he said. “No decision has been made on whether to pursue this as an option for the future and there are no proposals on the table in any event.”

Mrs Acerbi said the Save Sanders Lane campaign will continue.

She added: “We want to be informed in the future of every step of their plans and consulted so we can put across our view that this beautiful part of Mill Hill will be preserved for future generations.”

The AAP will next be approved by the council, after which it will become a legally-binding planning document that will guide developers.

Mr Machin wrote that he is in “no doubt” that the development would “bring about a considerable intensification of development and a much more urbanised feel to Mill Hill.”

Councillor Melvin Cohen, cabinet member for planning and environmental protection, said: “We have a duty to provide 20,000 new homes, and Mill Hill East is one of the places which the Council and the Mayor of London believe can help us to reach our goal.

”However, we will work to ensure that the attractive character of Mill Hill is preserved, and our legacy of outstanding Green Belt land is retained for future generations.”