HOMES for the elderly in Lancashire are being starved of cash even though the county council has funds to spare, according to an industry association.

The Lancashire Care Association, the organisation which represents the owners of 400 private homes, is claiming businesses are being forced to close through lack of cash.

And the LCA says cutbacks are being made even though social services chiefs are £3.5 million in credit on this year's budget.

Association chairman John Cairns said: "Jobs are being lost and homes forced to close while we wait for a better funded, better managed care system.

"We have been working hard to establish a good rapport between the association and county hall.

"However, appeals to us to be patient because of a county cash crisis have been seriously undermined by the revelation that the money is there, and is being piled up as a local authority reserve."

Mr Cairns claims that people have been left waiting for places in residential homes because of a lack of cash.

He added: "We are asking for a detailed explanation and a commitment to start spending this cash to help greater numbers of elderly people in Lancashire. "If people choose to go into an independent sector care home, then the social services department has no right to deny them, not even for financial reasons, and certainly not because the money is needed elsewhere in local government."

But Pauline Oliver, Lancashire's director of social services, has hit back at the LCA claims.

She said: "We had to significantly reduce social services spending last year because of a change in the way money was allocated by the government.

"There were some major reductions in the service and because the budget was so tightly controlled in 1994/95 there has been a knock-on effect this year.

"We are picking up the effects from last year, although £3.5 million is still a lot of money it comes from an overall budget of £250 to £260 million."

Mrs Oliver added: "There are one or two points in the LCA's statement which don't add up and I will be seeking clarification on them from the association.

"I am not aware of any case where people have been forced to wait for a place in a residential or nursing home because of funding problems.

"The statement also appears to suggest the council is denying people the right of going into the private sector but that simply does not tie up with the facts."

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