A coalition of councillors is calling for a cross-party inquiry into the management and spending of a £47.2 million project to revitalise east Brighton.
Brighton and Hove City Council leader Ken Bodfish has dismissed a recommendation by an employment tribunal chairman to "look very seriously" at eb4u.
Now 15 of the city's 54 councillors, led by Tory leader Garry Peltzer Dunn and supported by Lib Dem leader Councillor Paul Elgood, have tabled a motion demanding a full inquiry.
The motion also has the backing of Greens. It applauds the hard work of those involved in eb4u but outlines significant questions about how some of the £47.2 million is being spent.
The concerns emerged at a tribunal involving Robin Lucas, who was appointed by the Chichester Diocesan Housing Association to co-ordinate internet project ICT for eb4u.
Although Ms Lucas lost her claim for unfair dismissal, chairman Michael Davey said he was "deeply concerned" at the way a body dispensing large amounts of public money was being run.
He concluded: "There is a great deal of evidence which justifies a lack of confidence in the way this project (ICT) was administered."
The council said it would be reviewing the issues and considering whether further action was required.
But Coun Bodfish wrote to The Argus saying no formal inquiry would be instituted as the council already subjected eb4u to a high level of review.
Members of the council who have signed the notice of motion, due to be tabled on September 30, believe questions raised by the tribunal could undermine public confidence in eb4u.
The motion reads: "The council applauds the hard work and commitment of all those involved in eb4u which has led to some significant quality of life improvements as the scheme approaches its halfway point.
"However, this council holds significant concerns about how effectively parts of this money are being spent and how this could impact on the ability of eb4u to meet the challenging targets for community improvement which have been set."
It quotes the findings of a 2003 evaluation into the 39 national New Deal for the Communities schemes which highlighted "teething problems" in many projects.
Members of the ruling Labour group say they will try to block the motion.
Sean Hambrook, eb4U's deputy project director, said: "We are regularly subject to these routine reviews and audits by the Audit Commission, the Government Office for the South-East and Brighton and Hove City Council. These have always been successfully conducted, completed and all actions and recommendations followed through."
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