A DAMAGING freeze on European development aid meant for Merseyside has been lifted – allowing £54m to be released for key regeneration projects.

In March, the European Commission slapped a temporary ban on all European Regional Development Funding (ERDF) announced for England, after an audit found “irregularities”.

It was the second time in three years the Commission had thrown doubt on grants earmarked for projects across England’s poorer regions, because of tendering errors and faulty documentation.

And it threatened £54m earmarked for Merseyside – the last slice of £250m pledged over the seven-year period between 2007 and 2013.

Now Communities Secretary Eric Pickles has claimed the credit for “swift action” to restore the flow of regeneration funding, through “tighter controls on projects”.

And, controversially, he suggested the rescue flowed from the decision to bring the process “in-house” – following the announcement that the North West Development Agency (NWDA) will be axed.

Mr Pickles said: “The ERDF programme has been plagued by a legacy of poor administration and fines that dates back to 2000.

“The Coalition Government has overhauled the management of these schemes, bringing them in-house and successfully minimising the liabilities.

“The measures this government has taken have been recognised by the European Commission which has just announced that payments for the ERDF programme will restart, allowing vital regeneration work to continue.”