Shock waves are reverberating in the area after plans for a new Sainsbury’s store in Cardigan as part of a £50m project to include a new hospital were scrapped.

This week the supermarket giant announced it is cutting costs and spending to shore up its balance sheet and free up funds to take on rivals Aldi and Lidl.

Confirming that it was not intended to proceed with the development of the majority of new stores a company spokesman said he could not be specific.

But speaking to the Tivy-Side a reliable source said “Having been involved on the public relations side of the Cardigan development I can say that the proposed store at Bathhouse will not be built.”

Since Ceredigion planning councillors gave the supermarket the green light in 2008 there have been major land stability problems and everything has been on stop for more than a year with concern surrounding the health facility.

Although Sainsbury’s’ decision to pull out is down to financial considerations within the company there are many people in the area who say the land is totally unfit for a store.

After flying over the site last week pilot and Ceredigion County Council Chairman Cllr. John Adams-Lewis said “it was obvious the site was unsuitable for a build. From the air it resembled a lake.”

Geraint Evans who farmed Bathhouse for many years up until 1997 said “I was shocked to hear that anyone would consider a building project.

“I could have told the developers about stability issues – there are underground springs and part of the land is very wet. I’ll be amazed if they manage to build a hospital on the bog,” he said.

The source within Sainsbury’s said “There are a lot of major issues to be considered but the Cardigan development is a non-starter.

“The company realises that residents have kept faith in the aim to bring a new store to the town but unfortunately due to circumstances matters have changed,” he said.