A £2.5million new cafe bar which would have created 50 jobs in Blackburn has been refused permission by planning councillors.

Members of the planning and highways committee at Blackburn with Darwen Council turned down the application for the all-day venue.

The pub, which would have spanned the former Little Sheffield and Haworths Furniture Store units in Darwen Street, was refused on the grounds that it would wreck plans to regenerate the street as a shopping area.

Just two councillors, both Liberal Democrats, voted against refusal of the plan, despite the fact planning officers had recommended it be approved.

Concerns were expressed at the meeting by Marc Mallam, development officer for Blackburn Cathedral, on the grounds that another pub in the area could lead to undesirable activities in the cathedral grounds.

He told the meeting: "We are not just against pubs, but we feel a good decision would be to defer the plans so we can negotiate about the best possible solution."

The cathedral had called for money from leisure firm Luminar, who also own Jumpin Jaks in nearby St Peter Street, to pay for a fence which would keep drunks, vandals and prostitutes out of the cathedral grounds.

He said officials would now have to see if they wanted to press ahead with the fence plans after the pub scheme was kicked out.

Coun Ashley Whalley, the former head of regeneration, said: "The plan is to spend money on Darwen Street to make it an experience for shoppers. To lose four shops as a pub sets a precedent and in such a prominent area we need to make sure people know new retailers are coming in."

Peter Kuit, head of planning, told the meeting a plan to use the Darwen Street frontages as shops with the pub behind had been rejected by Luminar. They had, however, agreed to allow the upper floors to be used as offices or flats.

But Coun Andy Kay, current head of regeneration, said: "This will make it much harder to make Darwen Street a great shopping area. We will have two banks, a radio station and takeaways along the main stretch there and that doesn't inspire shopping."

Coun Jean Rigby, of the Conservatives, added: "Millions of pounds is being spent improving Darwen Street and Church Street, but it will be wasted if we allow this venue."

But Lib Dem leader Paul Browne said: "I can never see Darwen Street becoming a shopping area. We should let this area change as developers want."

All councillors bar the two Lib Dems voted for the application to be refused on the grounds it would lead to a loss of retail space.

Luminar can appeal, although they may look to new sites in the town centre.