CHARITY watchdogs have been called in to investigate the management and finances of a North-East community centre.

The Phoenix Centre, in Hartlepool, is suffering a cash crisis which will result in the five paid members of staff losing their jobs next month.

Bosses are confident the £800,000 centre will not close, but that will rely on volunteers offering to work without pay.

The centre, which was opened three years ago, is managed by the Central Residents Association charity.

Its founder and chairman Ena Savage blamed the problem on a withdrawal of funding from a number of organisations which have helped the association in the past.

A recent request for cash aid has been refused by councillors until the "considerable difficulties" are sorted out.

At a meeting of Hartlepool Borough Council's grants committee, members were told the association was requesting £14,579 to cover the salaries of two key workers.

Councillors agreed to hold back the money for the group and hand it over if the financial problems were satisfactorily resolved.

Janet Barker, the council's director of community services, said: "We are not suggesting we should withdraw funding but earmark it for them in the future.

"Their difficulties are too problematic and they need to sort themselves out before I would be in a position to recommend a grant."

Ms Barker would not elaborate on the money problems, but did say: "It would not be prudent for the council to put money into the organisation at the present time."

A Charities Commission spokesman said: "We received concerns about the charity's finances and organisation.

"As with any concerns raised, we are examining these as a matter of routine and we will take any matters forward if we conclude that this is necessary."

The staff who will be laid off on May 21 are a community development worker, receptionist, trainee, youth development officer and a cook.