THERE now appears to be no chance of winning National Lottery funds for the vital extension to St Leonard's Hospice in York.

Its fundraising manager said today that a second application had been rejected.

And the Evening Press understands that a further bid will not be made unless the criteria for the awards is changed.

The news comes in the wake of the controversy over the Millennium Dome receiving an additional £47 million in Lottery cash, which some fear could have a knock-on effect on awards for good causes.

A storm broke when the hospice's initial bid for £1 million towards its £2 million appeal for an extension was turned down by Lottery chiefs last October.

Fundraising manager Janet Morley said: "We did put in another application for £200,000 and obviously we are disappointed that we were turned down, but the reason given was because we have the equivalent of more than 12 months' running costs in reserve.

"The hospice has always believed it to be important to have the funds necessary to continue to give ongoing care for our patients and their families, and also enough with which to run the new development - rather than eating into these important funds for capital projects."

She added: "Of course we would not wish to comment on any grants awarded to other bodies and organisations, as the funding is not comparable and comes from different branches of the Lottery."

The Government was today trying to fend off a torrent of criticism following the latest bail-out for the cash-strapped showpiece attraction.

Cabinet Office minister Lord Falconer said he believed - though he could not guarantee - that the Dome would not need any further injection of funds.

Having initially received £449 million from the lottery, the Dome received another £60 million in February, a further £29 million in June and then, in August, an advance of £43 million from the sale of the Dome.

At the time, New Millennium Experience Company chief executive Pierre-Yves Gerbeau made it clear that there would be no more demands on the commission for funds.

But the commission said that the latest application from NMEC followed an external review of the company's financial position.