Its detractors may end up dubbing it "Dementiaville", but Switzerland is brushing aside a debate raging among geriatric-care experts with plans to build a mock-1950s village catering exclusively for elderly sufferers of Alzheimer's and other debilitating mental illnesses.

The newly approved €20m (£17m) housing project is to be built next to the Swiss village of Wiedlisbach near Bern and will provide sheltered accommodation and care for 150 elderly dementia patients in 23 purpose-built 1950s-style houses. The homes will be deliberately designed to recreate the atmosphere of times past.

The scheme's promoters said there will be no closed doors and residents will be free to move about. To reinforce an atmosphere of normality, the carers will dress as gardeners, hairdressers and shop assistants. The only catch is that Wiedlisbach's inhabitants will not be allowed to leave the village.

A similar pioneering, yet controversial, approach to geriatric mental care is already under way in Holland, where the Hogewey nursing home for dementia sufferers was set up in an Amsterdam suburb in 2009. Its residents pay €5,000 a month to live in a world of carefully staged illusion.

Markus Vögtlin, the Swiss entrepreneur behind the Wiedlisbach scheme, visited Hogewey before launching his own project and is full of enthusiasm for the Dutch approach. "People with dementia are often restless and aggressive, but at Hogewey they were relaxed and content," Mr Vögtlin told Switzerland's Tages-Anzeiger newspaper.He said that his plan to house dementia sufferers in 1950s- style houses with front gardens was designed to increase patients' sense of security. He said they had difficulty remembering what was happening at present but usually had firm memories of the past. "Such an environment makes them feel comfortable. I call it travelling back in time," he said.

Switzerland, like the rest of Europe, is struggling to cope with an elderly and growing population of dementia sufferers. There are 107,000 elderly people afflicted with mental illness and that figure is expected to double over the next 20 years.

Yet not all geriatric-care specialists are convinced that creating an illusory world is the right approach. Michael Schmieder, director of Switzerland's Sonnweid home that caters to 150 resident dementia patients, said he opposed the idea of creating an illusory 1950s-era atmosphere. "The very notion is an attempt to fake the normality that people with dementia don't have," he said.

Mr Schmieder's care home offers complete freedom of movement for its residents. "We offer wellness, just like a four-star hotel," Mr Schmieder said. "Our patients are living in the here and now, not back then."