The chairman of Leeds residential home Donisthorpe Hall has dismissed speculation that a £2.2 million wing would be delayed because of the credit crunch. But a major refurbishment scheme is under threat.

Geoffrey Caplan said the 21-bed, state-of-the art dementia unit was half-finished and "will definitely be completed early next year".

However, tougher economic conditions had forced the postponement of the £3.5 million plan to refurbish parts of the premises.

"Despite the problems, under no circumstances will services or quality of care to our residents be slashed," Mr Caplan said.