A controversial multi-million pound civic centre revamp has been scrapped, amid concern about town hall finances.

Sutton Council had intended to close its district offices and relocate staff under one roof in Sutton Civic Centre, but said the the £15 million costs were too high in the current financial climate.

It feared some of its projections for savings were not realistic, while selling off buildings during a slump in the property market was a mistake.

The scheme had come under fire from critics as being an unnecessary expense at a time when frontline services were under threat from budget cuts and job losses.

The council's executive admitted at a meeting on Monday there were too many concerns about its financial modelling for the scheme to now go ahead.

Plans to close and potentially sell-off historic buildings in Carshalton had also been criticised by residents and businesses.

When presented with the full business case for the “Smarter Working” project on Monday, members of the council's executive said it would not be appropriate to spend the money at the current time.

Councillor John Drage, executive member for finance and efficiency, said: “There are simply too many variables beyond our control. There are economic factors, uncertainty over the property market, Government housing reforms and question marks over the cost of borrowing, which mean we have to be cautious.”

The project was considered because the Civic Offices building is now over 30 years old and its electrics, lighting, heating and ventilation systems needed replacing.

Shutting offices including Denmark Road, The Lodge, The Grove and Stonecourt and housing the workers in the civic offices would have increased the number of staff able to work at the civic centre from 612 to 1,165, and early business models showed it would bring savings, Graham Whitham, leader of the Conservative opposition on Sutton Council, said £270,00 had been wasted preparing the business case.

He said: "Conservative councillors have stated from the start that they saw the proposal as poorly argued, backed by a flawed business case and causing considerable upset to residents in Carshalton, who were dismayed by the twin threats it posed to the valued heritage buildings in the unique Carshalton conservation area and to the economic well being of local businesses."