A GOVERNMENT agency has cost Kent more than 1,000 jobs by overturning its previous decision to back a £250 million newspaper recycling mill.

Aylesford Newsprint has denounced the U-turn by the Waste and Resources Action Programme (WRAP) to strip its “preferred bidder” status.

.WRAP’s previous decision in November following an open competition was hailed as a triumph for the firm, for manufacturing in Kent, and for recycling capacity in the United Kingdom.

The mill would have been the company’s second and created more than 1,000 short-term construction jobs and dozens of permanent ones.

The project already had planning permission from Tonbridge and Malling council and Government backing would have brought a million-pound subsidy.

But WRAP has dealt a huge blow to manufacturing in Kent by changing its mind and awarding “preferred bidder” status to Shotton Paper in North Wales.

Aylesford Newsprint’s chief executive Alan McKendrick said: “We regret the about-turn in WRAP’s position. We believe the decision is misguided and unlikely to deliver value for public money.”

Company secretary Donald Charlesworth said: “We’ve worked hard to try and develop recycling in the UK and everyone here is incredibly disappointed.”

Aylesford Newsprint said its scheme was much more ambitious than Shotton’s and would have offered the UK a wider range of benefits. It would boost newsprint capacity, improve the balance of payments by cutting imports, foster technological and product innovation, and aid the environment.

With most newsprint demand generated in southern England, preference for a Welsh firm could trigger thousands of extra lorry journeys and wipe out the proposed environmental benefits.

“The basis on which WRAP has proceeded is precipitate and reflects a short-term view,” the company said.

WRAP blamed Aylesford Newsprint for delay, accusing the firm of not being in a position to execute a contract within a “timescale that fulfils the objectives of the competition”.

Chief executive Jennie Price said: “There has been a significant shift in the nature of the commitment Aylesford are able to make which the WRAP board could not ignore.

“It is also vital to WRAP that our central objective of providing new reprocessing capacity is met within a certain and predictable timescale.”

But the Kent company said it could not make a final decision while the project remained subject to European Commission approval.

Global demand for newsprint had dipped sharply since the terrorist atrocities on September 11 and the company was unwilling to invest millions of pounds when there was so much uncertainty in the marketplace.

It said: “The Aylesford Newsprint board could not accept the effective elimination of all management discretion about the timing of the introduction of the major new paper machine into a volatile market at the risk of jeopardising the success of the project.”

However, it remained committed to improving the UK’s recycling rate and hoped to “re-engage” with WRAP on that basis.

* Chatham and Aylesford MP Jonathan Shaw accused WRAP of making the wrong decision.

But while he was disappointed, he had not given up hope of bringing the mill to Kent.

“I don’t think the door is closed,” he said. “Obviously WRAP want to see this major investment coming on stream as quickly as possible but I think Aylesford offers the best value for money and I will continue to pursue that.”

Mr Shaw, chairman of the Parliamentary All-Party Group for the Paper Industry, added: “I have worked on this project for the past four years and with my last breath I will give it everything I’ve got.

“I think the Aylesford deal offers the best value for money and that WRAP are wrong to make the decision they have done."