The celebrity launch of London's Millennium Wheel has been cancelled due to fears over safety.

Organisers say the inaugural ride on the wheel - officially called the British Airways London Eye - will not take place on New Year's Eve after one of the 32 passenger capsules failed a final safety test.

British Airways confirmed there was a problem with the clutch and its driving mechanism which keeps the pod stable during rotation.

BA spokesman Jamie Bowden said the decision to halt the first ride had been taken because safety was the "first priority".

"We always knew we had set a challenging deadline to complete the wheel by Millennium Eve but safety is always our priority and we will not compromise that in any way."

He denied the setback was a massive embarrassment but admitted: "Obviously this comes as a great disappointment to both the team who have worked tirelessly on the project and the 250 passengers who were due to experience the wheel's first ride at midnight."

The wheel will still turn at 2000GMT on Friday as part of the opening ceremony attended by Tony Blair, and an overflight by Concorde will go ahead.

Those due to enjoy a preview ride at midnight, including journalists, 250 prizewinners and local VIPs, will now be entertained at a party being held on a barge on the Thames.

They have also been offered air tickets to anywhere in the world.

No members of the public will now be allowed on the observation wheel until the opening at the end of January.

Mr Bowden said the news had been a bitter blow to the entire project team which had hoped they had overcome a series of glitches to get the showpiece structure operational for London's millennium celebrations.



Construction set-backs

In September, work to lift the wheel into place was delayed when a cable, which was temporarily connecting the central hub of the wheel to the outer part, came loose, causing others to do the same.

The wheel was finally lifted into place on 17 October, more than a month behind schedule, and was immediately taken over by environmental protesters who had to be coaxed down.

The delivery of the pods - designed to carry about 25 people - was delayed when unusually high tides on the Thames stopped the barges carrying them from getting under bridges.

The wheel, designed by husband-and-wife team Julia Barfield and David Marks, is set to remain in place for five years.

At 450 feet, it is the fourth tallest structure in London.