Controversial plans to site new local authority and government offices on a business park in Lowestoft are on a sound footing and vital for the further regeneration of the area, the leader of Waveney District Council has insisted.

Controversial plans to site new local authority and government offices on a business park in Lowestoft are on a sound footing and vital for the further regeneration of the area, the leader of Waveney District Council has insisted.

Mark Bee spoke out following a volatile few months for the £40m project, which would see offices shared by Waveney District and Suffolk County councils, as well as the Centre for the Environment, Fisheries and Aquaculture Science (Cefas), by the banks of Lake Lothing from 2010.

The project, known as the Waveney Campus, has been blighted in recent weeks following anger at the decision to issue compulsory purchase orders (CPO) to several firms on land earmarked for the building and claims the district could be forced to hand back a £685,000 European grant awarded to create the Riverside Business Park.

Mr Bee hit out at those he believed were trying to derail the project and stressed the Waveney Campus would further enhance the area's image as a regeneration hotspot.

He said: "I feel very confident that we will tick all the boxes we need to. We are perplexed, but not surprised, that people are making this an issue because we are coming up to an election season. They should be getting behind this."

Mr Bee's fire was directed at the opposition Labour group on the Tory-run district council and Waveney Labour MP Bob Blizzard, who have backed the campus concept, but spoken against the way the project is being progressed.

Labour fear the council could be forced to return the £685,000 for the business park, awarded in 1999 to create jobs, because the purpose of the area is being changed. In addition, there have been claims that the process of issuing CPOs has not been carried out properly, which will be ruled on in a public inquiry in April.

Mr Blizzard received a letter from the Government Office for the East of England (Go East), saying the grant could have to be repaid. Another letter from the East of England Development Agency (Eeda), which owns part of the site and is vital to the project's success, also sparked confusion when it said it had not been formally approached by Waveney. However, the council said Eeda had a place on the project board and had not raised concerns about the European grant.

Mr Bee said the project did not contravene the earlier grant because it would aid job creation and ensure Cefas would not leave the town.

He added that redevelopment of the council building site would also be likely to bring new jobs and pushing forward with regeneration would put the town in a stronger position to apply for cash for a third crossing over Lake Lothing.

Mr Blizzard said that while he backed the principle of the building, the location was wrong and the council's approach had been arrogant.

"They are not answering the criticism about the location of the building."

Sally Spore, leader of the district council's Labour group, said: "We haven't got a problem with the project, in principle."

A spokesman for Go East said any decision on whether European grant money would be retrieved could only be taken once the full details of the project were known. A spokesman for Eeda confirmed it was considering the campus project as a "concept".