COUNTY Council chiefs have admitted they believe a potentially cancer-causing waste incinerator will be built in Lancashire - after including its cost in a £300million plan.

Just weeks after Lancashire County Council told people in the county to recycle more if they did not want an incinerator, details of a £300million private finance initiative (PFI) have emerged.

That company would be expected to create a fully intergrated waste management system, which it would then rent back to Lancashire County Council, following the principle of PFI - trying to mix the best of both private and public sector working.

They would be tasked with disposing of the rubbish, but would have to meet Tough new targets set out in the Lancashire Municipal Waste Strategy mean that by 2005 40 per cent of the 785,000 tonnes of rubbish produced in Lancashire every year should be recycled.

Burying rubbish which cannot be recycled will stop - and the favourite alternative is in favour of alternative options -- with the favourite being incinerators.

Incinerators burn the rubbish and create energy -- but green groups claim they also produce dioxins which have been linked with cancer.

Groups such as ARROW, which was formed to fight the Lancashire proposals, have cited evidence from Belguim where incinerators exist,which showed that youngsters born near incinerators grew up with smaller genitals.

They say evidence from France also shows people living near to an incinerator develop more soft-tissue sarcoma and non-Hodgkin's Lymphoma cancers.

There is also concern about what happens to the rubbish after it becomes ash. At Byker, Newcastle, it has been spread across allotments and paths. The ash was found to have 800 times the 'safe' limit of dioxins in it. Soil around the plant was also found to have high levels of dioxins.

Plans for the PFI were originally discussed behind closed doors, despite an attempt by Lib Dem county councillor David Whipp to have the matter discussed in public.

The £300million Private Finance Initiative - a government project to try and encourage more involvement of the private sector - will not cover the entire cost of sorting out Lancashire's waste problem.

An application by the Press Lancashire Evening Telegraph to print details of a report into the £300million project was only allowed after it was pointed out some of the details had already been made public in a full council meeting.

A spokesman for Lancashire County Council said: "The £300m is the current best estimate of the capital funding required for the introduction of a fully integrated waste management system for the whole of Lancashire. If the extremely demanding waste minimisation and recycling targets are met, there will still be a need to deal with in excess of 300 tonnes of residual waste.

"At the moment the generally accepted way of dealing with such waste is by incineration with energy recovery and therefore the cost estimate includes a provision for the constructions of such a plant.

"However, over the next few years technologies may change and/or any private sector partner may propose another solution to that problem, it is for that reason that any need for an energy from waste plant will be reviewed in 2005.

A research project by Lancashire County Council showed 75 per cent of the public were in favour of an 'energy from waste' scheme.

But County Councillor Whipp said: "I think if people had been told that it actually meant using incinerators, the attitude would have been much different.

"The whole thing has been discussed in secret. If it hadn't been for Arrow, the county council wouldn't have been allowed to discuss it at its meeting. They would have shoved it through the back door.

"I think they are just trying to push through an incinerator on the quiet."

If the cost of the project soars beyond £300million, council tax could rise. Details of predicted rises were given to councillors behind closed doors.

Any council tax rise as a result of new waste policies will be split proportionately between charges made by borough and county councils, Coun Brian Johnson said.

The cabinet member responsible for the envrionment added: "To do nothing would cost a lot more.

"No figure has been decided and it would not be constructive to speculate on tax rises now." COSTS: Councillor Brian Johnson