The uncertainty arose, say campaigners, because developer Centros hasn't confirmed whether it would be represented at the public inquiry into the proposed Canal Corridor North development which will be held later this year.

Campaigning group It's Our City claims in the current economic climate and the outlook for retail in general it is conceivable that Centros may abandon the scheme altogether.

Centros has put plans for a similar scheme in Portsmouth on hold claiming that the company will have to redesign that scheme in light of the current economic climate.

A spokesperson for It's Our City said: "In Bury, Centros is already building a new shopping centre, and as with the Lancaster scheme they had promised a seamless link between the new shops and the old town centre.

"In Lancaster a 'bridge link' is promised to join St Nicolas Arcade to the new development. This is why much of Stonewell will be demolished under the proposals. In Bury a planned five metre wide link between the new an old shops has been reduced to a proposal to simply repave an existing two metre wide alleyway instead. This according to Centros is necessary as a result of the current economic climate. This does not bode well for the Lancaster scheme and says something about the value of the commitments and promises Centros makes.

"It is possible that Centros will pull out of the Lancaster scheme."

"The city council should state now that if Centros do not appear at the public inquiry then they won't waste public money on fighting the case for them."