Business leaders in south Staffordshire have complained that a "grossly unfair" system means the area is missing out on Government grants.

They accused regional development agency Advantage West Midlands of favouring city and regional interests when distributing cash aimed at stimulating business.

The charge was levelled by Peter Reid, the newlyappointed chief executive of Southern Staffordshire Chamber of Commerce, after a meeting with his AWM counterpart, John Edwards - who has dismissed the claim.

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Mr Reid said his own research had shown that the area was often excluded from funding initiatives aimed at helping business.

"It would appear that the needs of southern Stafford-shire are often seen as secondary to those of local cities and more urban areas," he claimed.

"For example, large amounts of money are channelled into regeneration zones, which are mainly based in the cities, relatively small initiatives do assist villages and market towns, but most of the population live and work in our towns and see no local benefit.

"This is grossly unfair. Southern Staffordshire has far more potential than many of these areas and yet its case is virtually ignored."

Southern Staffordshire chamber, which takes in Cannock, Lichfield, Tamworth and Burton upon Trent, says it is facing problems caused by the decline of traditional industries and the need to teach affected workers new skills.

"We want lost jobs replaced by new well paid employment in a balanced economy involving new industries", Mr Reid said.

Mr Edwards denied the chamber's claims, pointing out that the area was benefiting from more than £100 million in aid through support of projects such as the new i54 technology park near Codsall, the Keys Business Park at Hednesford, the Towers Business Park at Rugeley and the City Wharf redevelopment in Lichfield.

"As Mr Reid knows, the agency has an agreed set of funding priorities - helping the most deprived and needy parts of our region is a key priority."

Southern Staffordshire chamber had been due to merge with its counterpart organisation in the north of the county last year.

But the plan was ditched after it emerged that North Staffordshire Chamber was set to leave members liable for a £340,000 compensation package for its chief executive, Brian Carnes.