iCloud doesn't come into it. It doesn't provide general file storage or storage for music; its space is for iWork documents, email, and synced data such as calendars and contacts.
'iTunes in the Cloud' is free and allows you to re-download purchased items. What you need is 'iTunes Match' which is £25 p.a.
The songs which you purchased from iTunes can be re-downloaded at any time as they are already in the Store. Any items you have purchased elsewhere which are also available in the Store will be 'matched' and can be re-downloaded in the Store version. Items which can't be matched can be uploaded. There is an overall limit of 25,000 songs (purchased songs don't count towards this) so you are well within that.