THE refusal of a £2.5m grant to help restore a historic landmark has been described as a "bitter blow" by those fighting to save it.

Regional development ag-ency Yorkshire Forward has said it will not be helping to fund the £14.5m restoration proposals laid out for Harrogate's Royal Hall.

The decision has disappointed councillors who have already secured a substantial amount towards the costs.

A spokesman for Yorkshire Forward said that after a lengthy debate board members decided they were unable to support the project for two reasons.

"Firstly, it did not deliver the level of Tier 3 targets set out by the Government to create jobs and increase the number of new businesses we would expect for an investment of £2.5m.

"Secondly, as we are an economic development agency the board concluded the project was more about asset replacement than economic development."

The Grade II listed building was closed down after crumbling concrete was discovered in the 100-year-old structure.

Already, the National Lottery fund has agreed to give £6.5m towards the repair costs, Harrogate Borough Council has set aside £2.6m and a restoration trust is raising money towards a £1m target.

Councillor Mike Gardner, leader of Harrogate Borough Council, who lobbied for Yorkshire Forward's backing, said: "This is a bitter blow. The whole issue will have to be discussed by the cabinet shortly. It is a tremendous setback because this is one of the most important theatres in the country.

"The Royal Hall is, in effect, Harrogate's village hall and the refusal of Yorkshire Forward to help will have far-reaching effects."

The theatre is run by the Harrogate International Centre complex as an arm's-length operation from the council. If enough money cannot be raised to restore the hall, the council could face mothballing the structure.

However, Coun Gardner said it was unlikely the Government would sanction demolition of such an important building.

The Royal Hall's major restoration campaign is being supported by Sir Cliff Rich-ard, who appeared there with the Drifters and Wee Willie Harris in 1959. The Prince of Wales has also recently agreed to be patron of the restoration trust.