NEARLY half-a-million pounds of taxpayers' money will be spent buying an empty building in the heart of Kendal and converting it into a business hub.

Liberal Democrat-run South Lakeland District Council is set to splash out more than £475,000 in a move that it claims will address the issue of an 'inadequate supply' of small business units in the town centre.

Documents which went before the authority's cabinet yesterday said the enterprise centre on Highgate, next to the Brewery Arts Centre, will provide a maximum of 12 offices, as well as adding three rooms for networking and training and 2,338sqft of floor space for seminars.

One of the leading members of the council's opposition has slammed the spending saying it is a waste of money in times of financial hardship.

But the council insisted there was clear demand from businesses, that rent would help pay back some of the cash and a profit will begin to be generated in five years.

"In days of austerity and local government cutbacks we have got a district council investing in a grandiose project in the middle of Kendal that is just not needed," said Cllr James Airey (Tory, Low Furness).

"The real point that angers me is that they are cutting their cloth in particular areas yet spending more and more in Kendal.

"In Ulverston they have forced the town council out of their building and are selling that off because they say they cannot afford to run it.

"We have got a district council raking in money from right across South Lakeland and only spending it in Kendal. It just sends out the wrong message. "We all pay our council tax and we need a fair crack at the whip."

But SLDC defended the plan, saying it has a strong track record supporting business and economic growth and has already been involved in the successful development of business hubs in Ulverston and Burton-in-Kendal.

The authority said interest has already been expressed by independent training operators and both Lancaster University and the University of Central Lancashire to provide services to Cumbrian businesses, specifically satellite sessions away from the main university campus.

Leader of the Council Peter Thornton said it would go towards the council's plan of creating 1,000 new jobs while Cllr Jonathan Brook, portfolio holder for Innovation and Improvement, said there was 'clear evidence of demand' particularly in the creative and digital sector.

"There will be some who feel this is a risk not worth taking but I believe political leadership requires vision and vision requires action," he said.

And Cllr Giles Archibald, portfolio holder for Economic Growth, Town Centres and Small Businesses, said the development would bring back into use a 'key building' in the town centre, adding: "Once refurbished and let the building would be returning an income from office leases, car park permits, training suite hire and meeting room income."

Overall the council will put in £477,015 while the Regional Growth Network, whose aim is to help rural businesses grow, has promised a grant of £105,000.

Jonathan Isaby, chief executive of the Taxpayer's Alliance, said: "You can understand that a council wants to create economic growth in the local area, but it shouldn't be attempting to play property developer at a time when finances are under such stress."