A “missing” masterplan could delay the building of part of the planned Melton bypass.

Leicestershire County Council on Tuesday decided it would be too financially risky for it to put up the cash for the southern section of the road because, it said, Melton Borough Council (MBC) had not done enough to ensure the money could be recouped from developers.

A masterplan is an agreement between developers, local authorities and other infrastructure providers to ensure that any new housing is properly supported with appropriate infrastructure, funding and delivery plans.

The county council said that MBC has not yet drawn one up.

MBC said it had carried out “extensive preliminary planning”.

County Hall was set to put £13 million towards the £28 million needed for the project, with the other £15 million coming from the government.

But members of the cabinet at the Tory-run county council have turned down the government cash.

The route of the Melton Distributor Road

Leader Nick Rushton stressed that the county council was “committed” to the whole scheme.

“Without a masterplan to show the detail of the planned development and timescales, no reasonable authority would invest that amount of money, especially given the current economic uncertainty,” he said.

“It couldn’t be clearer what the county council requires and it is a shame it has not been provided. We know that the Melton Local Plan required a comprehensive masterplan to be produced after consultation, but that hasn’t happened. We can’t afford to wait any longer if the road is to be built.

“In the interests of the people who live and work in Melton, and to help the town grow in a sustainable way, the county council is prepared to commission and pay for the masterplanning work which is necessary for us to be able to invest as we want to.

"That's a very reasonable offer and it is now over to the borough council and its leadership to decide what they want to do to complete a project which everyone wants to happen."

County council leader Nick Rushton and Melton Borough Council leader Joe Orson

But Melton Brough Council said that “assertions” made by the county council were “misleading and inaccurate”.

MBC leader Joe Orson said: “At a time when the country and our public services need to pull together it is hugely disappointing that the county council have chosen to act in this way.

“As a council, we have worked hard to support delivery of the MMDR [Melton Mowbray Distributor Road] and have made a commitment to provide £6 million of local funding towards it, as well as continually seeking to work in partnership with the county council.

“We were, even today, putting together a plan for how we could work with the county council to resolve the current issues with the masterplan and find a way we can work together to meet this difficult challenge.”

It is believed that one of the key sticking points is a site for a secondary school not being identified, with MBC saying that the county council had knocked back its suggestions without providing alternatives.

Councillor Byron Rhodes, finance lead at the county council and MBC’s former leader, said it was “with a heavy heart” that the money should be rejected.

He added: “This is an enormous disappointment to me, particularly as I have been championing the road for years.

“We came tantalisingly close to having the funding for the southern section but we have a problem because the borough council failed to produce a masterplan.”

An MBC spokesman said that while the county council’s decision was “regrettable” it did not “undermine the credibility of the Local Plan, nor delivery of the southern section”, but would likely cause delays.