The Government has pulled the plug on a £85 million prison college for young offenders.
It was scheduled to open in 2017 alongside the existing Young Offenders Institute in Tigers Road, Glen Parva.
The fortified school was to be a pilot project aimed at providing better education for 320 youngsters aged 12 to 17.
It was hoped the approach would have cut re-offending rates.
But on Thursday Prisons Minister Andrew Selous told the House of Commons the project was being halted.
He said the number of young people in custody had fallen by more than a quarter and it was against housing a third of the national youth custody population in one place.
But the decision comes after £5.6 million had already been spent on the scheme called a secure college.
In a statement Mr Selous said: “The Coalition Government originally legislated for secure colleges as a way to deliver better education in the youth justice system.
“This Government is also completely committed to improving the quality of education enjoyed by young offenders.
“This is one of the Government’s top priorities. But the nature of the challenge has changed.”
He said the youth custody population had fallen from 1,349 in January 2013 to 999 in April this year, a fall of 26 per cent.
He added: “A secure college could have been desirable with a larger population, but it would not be right to house one third of the entire youth offender population in one setting.
“It would also be a mistake to press ahead with such a development when resources are so tight.
“We are therefore not going ahead with the creation of a secure college pathfinder.
“All work on the proposed secure college pathfinder at Glen Parva has now ceased.”
A spokeswoman for the Ministry of Justice said that £5.6 million had been spent on the scheme up to April this year.
She said £1.56 million had been spent on staff pay and procurement.
A further £4.04m was spent on design fees and site preparation costs.
The secure college would have housed offenders aged between 12 and 17 years old and focused on education and rehabilitation..
Set to open in 2017, the complex would have housed 320 teenage offenders, and would have been the first institute of its kind in the UK – with construction work set to start this year.
It would have featured 10 secure buildings specifically designed for education and living.
There would have been a full-size football pitch and basketball court.