Proposals by Herefordshire Council to refurbish St Katherine's Barn could end a paper salvage operation that has raised thousands of pounds for community projects.

Members of the Ledbury and District Society have expressed the fear ahead of formal talks with the council over revamping the whole St Katherine's area.

The society rents the barn for a nominal amount from the council and uses the 400-year-old Grade II listed building to store newspapers, which are sold and turned into bedding for horses.

Proceeds from the salvage operation have helped towards the reconstruction of the Butcher Row Museum and, in 1991, the society gave £10,000 towards the Ledbury Parish Church restoration appeal.

However, council cabinet member and Marcle Ridge representative Don Rule said: "The barn is listed. We can't continue with that being used for a paper store. We need to find some use for it. It could end up as a small museum."

Prue Yorke, chairman of Ledbury and District Society's planning group, said: "We'd like to retain half of it for newspaper salvage. We are open to suggestions for the other half."

Society treasurer Alan Starkey said the paper salvage operation had raised £2,057 in 2002 and £1,998 the year before.

The society itself has discussed improving the barn and in August 2001 welcomed news that the St Katherine's area, including the barn and the Masters House, could be revamped by Herefordshire Council.

Members then were hopeful that the barn could be turned into an information facility for tourists, complete with maps and displays.

But a report by Ledbury architect Ian Stainburn put the cost of structural repairs to the barn at £125,000 and members recognised that Lottery or EC money would be needed for the project.

Coun Rule has stated that Herefordshire Council itself has no funds in its budget this year for the proposed St Katherine's enhancement. But ideas for the future include moving Ledbury Library into the nearby Master's House, which could also house a council "one-stop shop" and the Tourist Information Centre.