The Gazette yesterday revealed a masterplan which would see certain areas in the resort's tourism heartland given protected holiday status while other tourism hotspots miss out.

Around 900 properties could be allowed to switch from hotel to private accommodation.

But the move has spread fears hotels in those areas passed over will find themselves surrounded by hostels.

While the plan has come under fire, Coun Maxine Callow said big decisions must be made for the resort's future.

The cabinet member for tourism and regeneration said: "You have to be brave and bold and you can't just think of now, you have to look at what you want Blackpool to be like in 20 years. I think even people in the industry would accept we don't need all the bed spaces we have now in what is a dwindling market.

"What we have to go for is quality and offer something for everyone. That's why we have travel inns here along with high quality hotels like the Hilton, De Vere and Imperial.

"What we've heard from the major political parties and conference organisers is, while they've been disappointed with the Winter Gardens, they've also been unhappy with the level of three and four star accommodation in Blackpool.

"They are big spenders and we need to get them back."

Town hall chiefs insist former hotels will become family homes but hoteliers have spoken of their concerns the premises will become houses of multiple occupation.

And business owners in streets which will remain in Blackpool's designated holiday areas said they were relieved to be included in the protected zones.

>> 900 hotels wiped off tourism map