PLANS for a £20million museum in Blackburn town centre are in tatters after a funding bid was turned down.

In a massive blow to the town’s regeneration plans, bosses were told the Heritage Lottery would not pay for their plans to open a “world class” museum, which would have been the cornerstone of a new “cultural quarter”.

Now Blackburn with Darwen council is under fire for its £500,000 purchase of a former wine bar which would have been a key part of the development, with opponents branding the plans “pie in the sky”.

Bosses insist the decision to splash out on Bentley’s, in Exchange Street last November was still a good investment and will probably now be turned it into council offices.

The ambitious plans also included a tie-up with London’s National Gallery and Victoria and Albert museum, which would have lent works to be exhibited in Blackburn.

The Bentley’s building would have created a grand entrance to the current museum, which would have been rebuilt, onto the main town hall square.

The rejection of funding follows a two-year campaign by council bosses and numerous taxpayer-funded studies, surveys and reports.

It also dashes hopes the popular Lewis Textile Museum, next door to Bentley’s, which has since become a drug rehabilitation centre, could reopen.

The building had been earmarked to form part of a later stage of the scheme once the current lease expires.

Council leader Mike Lee said he had not yet been told the reasons for the rejection, but blamed the cost of the London Olympics for the funding squeeze.

He claimed the council had been “encouraged” to bid by lottery bosses, adding: “They said they wanted to see something big like this outside London, but not in Liverpool or Manchester.”

Coun Lee insisted the purchase of Bentley’s had been a “strategic decision” because of its prime location and said the council had “fallback options.”

But Labour opposition group leader Kate Hollern said: “It’s a complete nonsense.

"I said at the time it was highly unlikely that they would get the sort of investment in a museum in Blackburn and that they should be more realistic.

"This is a huge reality check.”