EAST Lancashire was today reeling from an employment blow after an expanding company moved 400 new jobs to Northern Ireland in a row over grant support.

Homeloan Management - part of the Skipton Building Society - turned its back on Blackburn and Padiham after being offered £3.2million to move into a ready-made call centre in Londonderry.

The company is still going ahead with a new £4million call centre at the Shuttleworth Meade Business Park in Padiham where it already has a base.

But it criticised the North West Development Agency for failing to back its bid to keep phase three of its expansion in East Lancashire.

The agency today said it had offered the company some options eligible for grants in East Lancashire - but that the company had always known the area would not qualify for major European Commission grant support.

HML, which already employs 170 at Padiham, came to East Lancashire from Skipton because of its good communication links at the beginning of 2003 and received "a little help" from the NWDA for its first phase.

Sales and marketing director Tim Fletcher said the company had received no help for the second phase and some minor grant aid for phase three, which had led to it looking elsewhere.

The Skipton Building Society board is still due to meet on February 2 to finalise the phase two development at Shuttleworth Meade which will bring up to 400 new jobs to the town early next year.

Mr Fletcher said: "We wanted to have a third call centre in East Lancashire, but when we asked for grant support from the NWDA, we were only offered a limited amount of money provided we based it in Blackburn.

"In Northern Ireland, we were offered a brand new building in Londonderry as part of a grants package totalling £3.2million which included money to train the 400 people we will be taking on there.

"It is disappointing not to be consolidating our expansion in East Lancashire, but as a company we could not ignore the grants that were on offer in Northern Ireland."

HML, manages more than £20billion of mortgages on behalf of building societies and other financial institutions and grew its turnover last year by 84 per cent.

Some of the work currently undertaken at Padiham will be switched to Northern Ireland, but Mr Fletcher insisted that no one would be made redundant.

Mr Fletcher added: "The work of around 20 to 30 staff will be affected, but the people involved will all be redeployed. We are very happy with the quality of staff we have recruited in East Lancashire and we have vacancies for more new staff in Padiham."

A spokesman for the NWDA said East Lancashire no longer met European Commission guidelines as an area in need of major employment assistance.

He added: "The NWDA has been engaged in discussions with HML since their initial investment into Shuttleworth Business Park at the beginning of 2003.

"HML made the location decision at the time knowing that this is a non-assisted area for grant support.

"As such the company was not eligible for regional selective assistance grant funding. As part of the NWDA's on-going relationship with the company, a number of accommodation options nearby were suggested. The company discounted these options."