HARRY Cohen is "extremely concerned" about the handling of millions of pounds of taxpayers' money allocated to help the borough's poorest people.

In a strongly worded letter to Waltham Forest Council's chief executive Roger Taylor, the Leyton MP says that he is considering referring the matter to the National Audit Office and Local Government Ombudsman.

He also questioned Mr Taylor's conduct directly, asking him to explain why it took three months to provide an "unsatisfactory" response to a reasonable inquiry on the issue from a member of the public.

Mr Cohen asked Mr Taylor to explain why millions of pounds from the Neighbourhood Renewal Fund (NRF) appeared to have been so poorly managed.

There were major anomalies in the way the performance of the Better Neighbourhood Initiative (BNI), which was created in an attempt to ensure a more focused use of NRF funds, has been measured.

Figures showed that In 2006/7, 60 per cent of the of BNI spending had either not achieved what it was supposed to, or no-one knew what it has achieved because of missing data.

Furthermore, much of the remaining 40 per cent of the money was not spent specifically in the borough's poorest wards.

A recent report by consultants Dr Foster Intelligence, which cost taxpayers £47,000, was found to be flawed by the company's own ethics committee.

The contract is currently the subject of a council fraud investigation, due to fears council tendering rules were broken.

But in an email from Mr Taylor to Nick Tiratsoo, vice chair of Leytonstone Community Council, which has been seen by the Guardian, he stated that he was satisfied the matter was dealt with "appropriately".

Mr Cohen wrote: "Local people are extremely concerned that this programme, which should be helping to bring about real improvements in specific areas, is clearly not achieving what it should be achieving.

"I share my constituents' concerns - particularly as such large sums of money are being put into this programme with the intention of delivering clear improvements in specific areas."

A recent review of the council's performance on regeneration by senior officers of other councils concluded: "Although there are examples of specific initiatives that have benefited local people in terms of regeneration and redevelopment these are not on a scale that would impact significantly on their localities."