A COUNCIL-RUN centre for small businesses in Stockton has been labelled a white elephant by one of its tenants.

Stockton Business Centre, in Brunswick Street, provides small starter offices and workshops for new businesses and those looking for their first commercial premises.

A new £1.5m extension with 21 units is due to be officially opened in the next couple of weeks, but Hyder Business Services, which moved into the new block in January, says it is moving out because inadequate internet facilities have hampered the business.

The company is also unhappy about a clause in its licence agreement that gives council workers or sub-contractors freedom to enter the unit as and when they like, without prior permission or supervision.

Stockton Borough Council's web site describes the business centre as having "high-speed broadband internet links".

But Brian Howes, of Hyder, described them as "snail's pace".

He said: "When we agreed to come here, we told them we were an internet-based business and we were assured it was a state-of-the-art building with a state-of-the-art internet system.

"In fact, we have had to lay off one member of staff and work from home because the system is so slow.

"We have two internet connections, but when we try to use them at the same time they both come to a standstill.

"We have complained to the centre manager and the head of department at the council, who admitted that the problem was affecting all the council.

"They said they were hoping to upgrade the system in May, but we can't wait until then - we would be out of business."

A spokeswoman for the council said: "The unusual internet problems that Mr Howes has reported have, to our knowledge, not been experienced by other tenants. We are sorry that one of our tenants is experiencing these difficulties and apologise for any inconvenience caused to his business.

"We are keen to resolve the problems, which are currently being investigated by the council's IT experts."

Mr Howes said council employees had electronic master keys that allowed access to all the units at any time. He said a £1,500 camera had gone missing from Hyder's premises, but a clause in the licence agreement exonerated the council of any responsibility.

"People just walk in here completely unannounced while we are working and we are obliged to accept it," he added. "They can also come in when we are not here. I don't think that is a reasonable agreement."

The council spokeswoman said three master keys were held by designated council staff, but contractors had been given a key in January for convenience.

The council has now agreed to refund Hyder three months' rent, provided it does not pursue any other claims, and the company is looking for alternative premises.

"We are just glad to be getting out," said Mr Howes