A street party for Pride revellers is to go ahead despite the arrest of last year’s main organiser.

Rumours have spread on the internet that the annual festivities in St James’s Street, Brighton, which follow the main event in Preston Park in August, have been cancelled.

Despite a police investigation into the alleged theft of thousands of pounds after last year’s party, businesses in Kemp Town are working together put the event on again this year.

The "street party" is entirely separate from the organisation of Pride itself but has become for many an integral part of the weekend’s celebrations.

Last year’s organiser, Ben Davie (CORR), 33, was arrested in October on suspicion of theft and fraud. He has not been charged and remains on police bail.

A statement from Sussex Police said: “A 33-year old man, first arrested on 22 October 2009, is still on police bail whilst enquiries continue into allegations of theft and fraud of funds relating to the St James’s Street annual street party.

“A report is being submitted to the Crown Prosecution Service and the man is next due to answer his bail on 25 June.”

Michael Condon, landlord of the Aquarium Theatre Bar, is now chairing the Village Street Party 2010 Committee to spearhead the event on Saturday, August 7.

He is gathering licensing applications from bars in the area to hold entertainment and sell drink in the street, and raising money to employ Hove firm Triptych Events UK, which has run the last two parties, to provide organisation and stewarding.

He said: “We will start doing it towards the end of this week and the beginning of next week.

“We are all wanting to get that sense of community spirit back together and work with each other.”

A spokesman for Brighton and Hove City Council said: “We're still hopeful it will happen.

“The signal we're getting from the LGBT community is that all is not lost - and we hope not.”

The whole Pride festival was in jeopardy last year when organisers raised only a fraction of their fundraising target of £50,000.

Brighton and Hove City Council stepped in with a £20,000 loan to make the event possible.

Judith Manson, of Pride Brighton and Hove, said: “The street party has become part of the celebration of the week.

“We would love to see it going ahead.”