A total of £250,000 has been written off after a controversial school extension was abandoned.

Community leaders in Peacehaven protested when it was announced one of newest schools in East Sussex would not go ahead with a proposed expansion because of the £7 million cost.

Now it has emerged the costs of drawing up plans, getting consultants' reports and carrying out surveys on land surrounding Peacehaven Community School reached £250,000.

Critics are demanding an investigation into how such a "scandalous" waste of money was allowed.

The new school, which opened in August 2001, and improvements to junior schools in expanding Peacehaven are being funded under a private finance initiative (PFI).

This allows for private companies to work with local authorities and Government departments to get facilities built.

Even with the new schools, demand for places has exceeded supply and some Peacehaven children have to be educated outside the town.

Peacehaven Schools Ltd was formed to build the new schools with long-term contracts with specific suppliers.

The extension would have increase the size of the school in Newton Road from 750 to 900 pupils.

David Rogers, the Liberal Democrat opposition leader on East Sussex County Council, said the large amount being written off showed up the flaws of PFI schemes.

He said: "Both Tory and Labour governments insisted Peacehaven's much-needed new school had to be funded by a PFI scheme.

"Now we can see just how expensive and inflexible this project turns out to be with £250,000 lost before it was discovered this project was not cost-effective. Just think what could have been done in other schools with this money."

The cost of abandoning the project was revealed in a small paragraph in a county council document.

Lewes district councillor Liz Lee said: "I know just how short of funds schools are. This just goes to show the stupidity of governments' insistence on PFI."

Roger Simmons, lead councillor for education on East Sussex County Council, defended the £250,000 spending.

He said: "This is no scandal and nothing has been hidden in the small print.

"The sum relates to costs incurred in commissioning the detailed design of the proposed extension.

"Had we proceeded on the terms offered, there would have been greater additional costs to the county council of between £300,000 and £500,000 a year, increasing by at least £20,000 a year for the remaining 20 years or so of the project."

Mr Simmons said not all the plans had been a waste of time as some of the work would be used to build a new food technology room.

He added: "Without PFI there would have been no secondary school or new primary school building in Peacehaven."