BLACKBURN with Darwen Council has admitted it may lose hundreds of thousands of pounds in a regeneration funding crisis.

The authority has already pledged over £500,000 of its own money to kickstart projects supposed to be funded by the North West Development Agency (NWDA).

But the regeneration quango has imposed a cash freeze after bosses over committed on spending proposals.

Last week, Coun Andy Kay, executive member for regeneration, insisted there were no difficulties and that he was "confident as you can ever be" of getting the money back from the NWDA.

But at a meeting of Blackburn with Darwen's economic regeneration partnership funding group this week, Coun Kay admitted the borough could end up footing the bill.

The group is made up of representatives from business organisations, training bodies and the council and meets to discuss regeneration programmes.

Coun Kay told members: "A lot of master-planning and background work will be carried out while the funding is sorted.

"There is a slight chance we will have to underwrite these ourselves."

Members of Labour's ruling executive committee at Blackburn with Darwen have already given permission for £275,000 to be released to fund preliminary work for a town centre renaissance project.

It followed councillors also agreeing to use £300,000 in the borough's reserves to fund a new industrial estate.

Opposition councillors expressed concern about council coffers being used and the Conservatives questioned why only projects in Blackburn had been singled out.

Coun Colin Rigby, leader of the Tories, said: "It is money that could have gone elsewhere.

"I am not particularly pleased about it but, on the other hand, if we have money to devote to Blackburn why can't we spend some in Darwen?"