A CASH blow will not jeopardise plans to transform a former Accrington mill into a £2.6million community centre, one of the project's leaders has insisted.

The New Era centre in Paradise Street is currently being turned into a home for a range of agencies and activities, including the Citizen's Advice Bureau, the Asian Community Forum and youth services.

The building, which has been used as a dance hall in the past, will also house a cyber cafe, sports hall and recording studio.

The project was being funded by a £1.3million Millennium Commission grant along with money raised by the New Era Development Trust.

The total also includes sums from Hyndburn Council, English Partnerships and European grants.

But English Partnerships, which originally pledged £100,000, has withdrawn £43,000 - which meant a similar total was lost from the Millennium Commission's matched funding.

Hyndburn Council's economic regeneration manager Harry Ballantyne told a meeting of the Hyndburn Partnership Board that the total loss of £86,000 was a blow.

He added that structural problems had been discovered at the New Era building and more money could be needed.

The board decided to grant an extra £10,000 of Single Regeneration Budget money towards the work.

But County Coun Dorothy Westell, chairman of the trust, said work was progressing at the centre despite the cash blow.

Mrs Westell said: "We will have to monitor the work but it's a two-phase programme and we expected problems at the start of each part.

"It was a bit difficult because we didn't know we were going to lose the money, but we have a good committee and the work will go well."

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