COUNCILS in East Lancashire are sitting on nearly £5million of unspent cash given to them by developers for improvements in the local area.

The Lancashire Telegraph has also learnt that two councils, Burnley and Rossendale, have had to return a total of £93,000 to developers because they didn’t spend it in time.

The section 106 money, which is given to local authorities by developers as part of negotiations for planning permission, is used by councils for various projects that would improve infrastructure and facilities for local residents.

This could be new play areas, street crossings, open green spaces and cash for local schools.

Critics said not using the money was ‘wasteful’.

Hyndburn Borough Council is sitting on just over £2,000,000 of unspent s106 cash, although much of this is from the recent Tesco development.

Coun Miles Parkinson, leader of Hyndburn Council, said: “The money is often spent on improving our parks and open spaces, local infrastructure or transport, for example the council recently invested £200,000 of section 106 funding in Accrington Railway Station to enable that scheme to attract European funding.

Wherever possible the council seeks to maximise the value of s106 contributions by trying to find sources of match funding.”

Burnley has £561,000 unspent which has been allocated to schemes.

In 2009/10 it was forced to hand back £66,000 without spending it.

A spokesman for the council said: “If the council or county council does not fulfill its side of the agreement, for example if the road improvements are not implemented within the agreed period of time, the developer can ask for the money to be returned.

“This happens only rarely and where there are good reasons for not fulfilling the agreement.” Coun Julie Cooper, leader of the opposing Labour party, said the waste of money was ‘incompetence’.

She said: “Considering the problems facing Burnley it is not very clever of the council to let this money slip through their fingers.”

The other council which has had to return s106 cash is Rossendale, which lost £27,000.

It currently has £640,000, while Blackburn Council has £500,000 unspent.

Pendle Council has £989,000, and Ribble Valley the least with £46,000.

A spokesman for campaign group the Taxpayers’ Alliance said: “It’s a sad state of affairs that, at a time when many councils are trying to find ways to make savings, they are under pressure to spend money from developers by a certain deadline.”