'Millions wasted' in bid to halt Islamist terrorism (VIDEO)

On the eve of the fifth anniversary of the July 2005 bomb attacks, the Government's Preventing Violent Extremism programme has "tainted" good community cohesion work by associating it with counter-terrorism, critics say.

Some fearful Muslims believe they are being "spied on" by councils and even their own organisations which have accepted Prevent money.

In a special report in today's Yorkshire Post focusing on Beeston, Leeds, where three of the suicide bombers grew up, it is clear residents have remained largely united. Some young people have emerged as talented and determined leaders and cite 7/7 as a turning point.

Around 200m of Government money has been spent on housing, schools, health and sports facilities but some of the spending has bred resentment in areas that missed out.

The Prevent programme has also led to bitter arguments among Muslim community groups, with critics refusing to engage in the counter-terrorism scheme and others taking the money because alternative sources of funds have dried up.

Across Muslim communities there are claims they have been stigmatised and singled out, while white, far right extremism has been ignored.

A cross-party panel of MPs concluded that the focus on Muslims has been unhelpful and potentially alienating.

The MPs heard evidence of a "backlash" from those who feel Muslims are being given preferential treatment – a "sort of favoured status as a result of radicalisation", according to one Sikh leader.

The coalition Government is now reviewing Prevent amid calls for its grants to be axed.

According to the Taxpayers' Alliance, more than 12m has been given out by local authorities – including Leeds, Calderdale, Wakefield, Kirklees, Sheffield and Bradford.

Report author Matthew Sinclair said the grants should be abolished and the money spent on policing and intelligence.

"Local authorities, with all the will in the world, cannot do the job of unravelling the dense networks of radical Islamists," he said. "It's a hard enough job for Government."

A Commons select committee of MPs has also called for a review of Prevent because "as delivered thus far, the Prevent programme has stigmatised and alienated those it is most important to engage, and tainted many positive community cohesion projects".

Racial justice campaigner Ratna Lachman, of JUST West Yorkshire, based in Bradford, said there was little accountability or openness and she is angry at what she sees as whole communities being labelled as potential terrorists.

"People are suspicious of each other and their own organisations. This has sowed poison."

However, councils say the money has enabled useful community work.

Councillor Imran Hussain, of the Bradford Prevent Board said: "Prevent has helped us to do a tremendous amount to help bring people from different backgrounds together and to improve mutual understanding."

The programme has already been subject to Government cuts. Leeds's funding has been cut by 84,000 to 203,000 this year, Wakefield has just lost 57,000 and Bradford's has been slashed from 628,000 to 445,000. More savings could cast doubts on its future.

A Government spokesman said the Communities and Local Government Select Committee had expressed grave concerns about the effectiveness of the programme and its impact on Muslim communities. He added: "We are looking closely at this programme as part of our review into departmental spending."

11m paid out to bombers' victims

Victims of the July 7 attacks have now received a total of 11m in compensation – but seven are still awaiting a final settlement.

The Criminal Injuries Compensation Authority said it had received 650 claims relating to the 2005 London bombings

Four suicide bombers killed 52 innocent people when they detonated their devices on the capital's public transport network on July 7, 2005 in the nation's worst terrorist atrocity.