REGENERATION projects aimed at breathing new life into East Lancashire have been hit by a massive funding crisis.

Hundreds of schemes to improve the quality of life in some of East Lancashire's poorest communities have also been told to expect massively reduced grants.

Some of East Lancashire's biggest schemes have been hit by the shortfall - described as 'reprofiling of funding.'

A major inquiry has now been launched into the £200million over-commitment by the North West Development Agency, which has been told the mess must never happen again.

Projects affected include:

The £70million Blackburn town centre 'renaissance' which has had its grant cut from £13million over five years to just over £5million. The rest 'may follow.'

The £60million 90-acre East Lancashire Gateway project in Whitebirk. NWDA funds to buy a 90-acre site from the Dunkenhalgh Estate in Hyndburn have been pulled, putting the scheme to design a state-of-the-art business park in jeopardy.

Hundreds of community group projects in Blackburn, Darwen, Hyndburn, Pendle and Burnley have lost around £3million this year.

The Project Phoenix scheme to overhaul housing in Blackburn Road, Accrington, and create a new community has lost several hundred thousand pounds this year.

NWDA bosses today said they were still committed to giving the money they had promised to projects - but couldn't say when.

The over-commitment out of a budget of £400million now means that councils could lose millions more in match-funding.

The NWDA start reviewing projects earlier this year after a new management team took over.

Steve Hoyle, assistant director of regeneration at Blackburn with Darwen Council, said the council was now drawing up fresh plans for the town centre, including the pedestrianisation of Sudell Cross, pushing some projects further into the future and scaling some back.

He said: "It has caused major problems.

"We are hopeful about more money but it depends on their funding circumstances in the future.

"We are now re-drafting the programmes and trying to fit in with the new funding flow."

Nigel Rix, director of Hyndburn First, the council's regeneration arm, said it was now not known whether the sale of land for the Gateway project on the Blackburn-Hyndburn border would go through.

He said: "It is a worry but we are now working with Blackburn with Darwen and other partners, including the NWDA, to try and find a way forward."

Blackburn has lost around £1 million from its £4 million community scheme budget for the year, Hyndburn is down £500,000 to £1.4million Burnley has reported a shortfall of £1million from £4.5million while Pendle's is also down.

The sorts of projects suffering include environmental schemes, community groups and East Lancs Moneyline - which provides loans for people who otherwise couldn't get them.

Ian Whittaker, Lancashire manager for the NWDA, said: "We are re-profiling but remain committed to supporting the projects we have said we will.

"We are working hard with our partners in East Lancashire to ensure the best results."

A spokesman for the North West Regional Assembly - which scrutinises the work of the NWDA - said: "We have been assured that measures are being put in place to make sure this does not happen again.

"We are investigating what has happened and the NWDA will come to us later this year so show that those measures have been put in place."