Half of the county's care homes for the elderly will be sold off or leased, while the rest will still be owned by the county council.
But councillors agreed that none of the 25 homes in Essex should close.
As angry pensioners protested on the steps of County Hall in Chelmsford, Essex County Council's social services committee yesterday (Thursday) heard the changes would mean an extra £2 million could be spent on improving services for the elderly each year.
They unanimously voted through the proposals. The decision is due to be ratified by the full council next week.
The action will mean one county council-run home being kept open for each district.
But some councillors warned they wanted a cast iron guarantee that any money saved would be put back into services.
Labour group leader Mervyn Juliff said: "Only if the money is reinvested in this service will we give support to it. That's the trade-off."
Committee chairman Elizabeth Dines (Con, Maldon) said she would ensure there was a three-year budget committed to elderly services.
The future of Foundry Court in Manningtree is less clear. Councillors decided to consider an alternative use, possibly as sheltered accommodation.
Areas where the extra cash could be spent include expanding schemes to keep elderly people out of hospital.
But Pat Pascoe (Lib Dem, Colchester) said: "Regrettably I do not think we can guarantee anything. However, we must do as much as we can."
Afterwards campaigner Phyllis Webb, welfare secretary of Braintree Pensioner Action Group, said: "We are not completely disheartened because it was better than we thought.
"There have only been a few of us, but we did collect hundreds of signatures."
Grey power- campaigner Phyllis Webb leads the County Hall protest
By Tania Cocksedge
Reporter's e-mail: tania_cocksedge@thisisessex.co.uk
Homes staying with county
Queens Park Court, Basildon
Millard House, Braintree
Winifred Dell House, Brentwood
Goldenley, Castle Point
Okeley, Chelmsford
Greenways, Colchester
Sherrell House, Epping Forest
Longfield, Maldon
Sweyne Court, Rochford
Lime Court, Dovercourt
Stanley Wilson Lodge, Saffron Walden
Ashlyn, Harlow
Homes being sold or leased by county
Woodlands, Basildon
Park View, Braintree
Eastham, Chelmsford
Scarletts, Colchester
Trippier House, Colchester
Beechlands, Epping Forest
Elm Tree Close, Frinton
Poplars, Walton
Well House, Brightlingsea
Redbound Lodge, Uttlesford
Hatherley, Saffron Walden
Converted for the new archive on 19 November 2001. Some images and formatting may have been lost in the conversion.
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