THE leader of the Liberal Democrats on the council has accused a leading Labour councillor of trying to "bully" his group into supporting the controversial Arcade site bailout scheme.

Cllr John Macklin and his Lib Dem cabinet colleagues have refused to support the plan to fund the redevelopment by borrowing £35m.

Cllr Terry Wheeler, the cabinet member for investment, last week accused the Lib Dems of favouring a "do nothing" approach that would "leave a hole in the ground".

Cllr Macklin said: "If Cllr Wheeler isn’t careful these proposals will be seen as yet another attempt to suddenly rush into regeneration commitments in Walthamstow in the run-up to a local election. “We won’t be bullied into making poorly thought out decisions just so he can have cranes on the Arcade site for next May."

Developer St Modwen were due to fund the development, but they pulled out of financing it.

St Modwen will still be retained as a designer and paid £500,00 Last month it emerged that the council's Arcade plan would break European Union rules if implemented.

The project now falls under European Union public sector procurement rules, meaning the contract must be put out to tender, meaning the project will be delayed further.

Cllr Matt Davis, Conservative group leader, has called for Walthamstow market stalls to be relocated to the Arcade site temporarily until the economic climate improves.

He believes this will free up the High Street and make it easier for businesses to trade.