THE regeneration of Thornaby's shopping centre was halted dramatically yesterday after negotiations between a developer and Stockton Borough Council broke down.

The local authority now faces an additional bill of more than £60,000 to fund property and legal advice following the collapse of talks with London developer WD Ltd.

WD was chosen in April 1999 to remodel and refurbish the shopping centre at a cost of £4m. That sum included contributions from the council.

Public consultations followed to ensure the scheme met local needs, and hundreds of people visited an exhibition of the plans in June this year.

But now the council claims that the company has, without warning, reduced the amount of cash it was willing to invest, and refused to accept conditions imposed on the deal by the public consultation.

Ian Pallent, secretary of the Thornaby Regeneration Partnership Board, said: "We have worked long and hard to create a scheme to meet Thornaby's needs and the wishes of its people.

"Now, after all this time WD have lowered their offer and imposed new conditions that mean their plans no longer fit the original brief.

"They are not prepared to include the proposals we put forward as a result of local consultation and the cost to the borough council would also change significantly.

"I am particularly disappointed because we intended to direct all the proceeds from the sale of the centre back into Thornaby.

"If the developer is not prepared to keep to his original offer it will reduce the benefit for the town and its people."

Mr Pallent denied the scheme was back to square one, even though the bidding process would have to be restarted, because the original public consultation process was still relevant.

Yesterday, the partnership board accepted a proposal to seek another private sector partner to take out a long-term lease on the centre in return for refurbishing it at an agreed cost.

Stockton Borough Council would retain the freehold and, with the Regeneration Partnership, prepare the development brief to guide the developer.

Plans to redevelop the existing health centre are continuing as previously agreed.

WD was unavailable for comment on the breakdown of the deal.

The loss of investment for Thornaby follows the loss of £300,000 of sponsorship for Stockton after the collapse of a deal between the council and foods group Nestle.