HUNDREDS of jobs could be created in Burnley after a £2million plan to rejuvenate an area of the town centre was revealed today.

The North West Development Agency has announced funding for the demolition of the town's derelict Co-op building in Curzon Street.

The site was earmarked for retail development earlier this year after supporters of a retail development for the disused supermarket beat off an opposing bid to create a JobCentre Plus on the site.

Burnley Council hopes to attract a major retail name such as Debenhams to the town and claims the scheme could create up to £25million of investment and 400 jobs.

The £2million from the NWDA will pay for acquisition and demolition of the site, which will be used as a pay and display car park until a developer is chosen later this year.

Stannifer, the company which last year bought the Curzon Street and Charter Walk shopping areas, has major plans for the site and is one of those hoping to be chosen.

Building work could start on the site in less than 18 months.

The plans have received the backing of the town's Chamber of Trade and the privately-funded Town Centre Management team.

Burnley MP Peter Pike, however, has voiced concerns over a retail development and was a firm advocate of the Government-proposed job centre. Hopes are still high that scheme will find a home in the town.

Leader of Burnley Borough Council Stuart Caddy said: "This represents a major and exciting opportunity to improve the retail offer and commercial vitality of the town centre.

"The project could lead to an estimated £25million of investment, which will build on Burnley's attractiveness compared with other regional town centres and also provide excellent shopping facilities for the people of Burnley.

"We are grateful to the NWDA for the funding support that has made it possible to assemble the site. Following the demolition of the structures, part of the land will be used as a car park, while a developer is chosen. We anticipate that we will select the developer later this year and construction work could start within 18 months."

Stewart Swift, NWDA area manager for Lancashire, said: "We are very pleased to assist Burnley in achieving its regeneration priorities. This scheme, which has the potential to create significant job opportunities, will also help to improve the economic prospects of the town."

Chamber of Trade secretary Rita Walsh, said: "We have always wanted this site to be used for retail purposes and the traders and businesses in the town will be very keen to see the development go ahead.

"We need to keep our fingers crossed that whoever is chosen to carry out the development will be able to deliver a good package which will benefit the town."