HYNDBURN will receive nearly £1.3M between 2006 and 2008 to pump into its poorest communities.
The borough will get £1,293,636 from the Neighbourhood Renewal Fund (NRF) - which provided funds for Hyndburn's ill-fated neighbourhood wardens - for a further two years although NRF funding was due to end next year.
From 2006 to 2007 the borough will receive £862,424 but only £431,212 from 2007 to 2008. This is because Hyndburn has climbed out of the 50 most needy authorities.
Council leader Peter Britcliffe warned that projects funded by the NRF might not attract funding from elsewhere.
He said: "We have already seen the tip of the iceberg with the wardens' funding. Projects funded by NRF will have to run down during that period.
"We are losing funding but the good news is that Hyndburn is getting better and is no longer seen as being so poor. Basically, Hyndburn is the victim of its own success and it's a shame some projects will run down.
"I am hoping the Government will admit that Hyndburn is underfunded in the rate support grant. Mainstreaming NRF-funded projects will be difficult because it depends on the willingness of partners to cough up. This doesn't mean the council will not look at other funding means."
With the affluent Wirral receiving nearly £14.4M between 2006 and 2008, the funding has left some wondering about the fairness of the calculations.
But Phil Woolas, minister for Local Government, has defended the scheme.
He said: "The resources demonstrate the Government's continued commitment to social justice and opportunity for all.
"We are committed to improving the overall quality of life for people living in our most disadvantaged areas. We want them to share fully in a better society where we see respect for people of all ages, races and faiths and for the communities they live in.
"These funds will support local authorities, other agencies and communities working together to achieve these goals."