Boris Johnson’s election promise to rescue struggling towns has been thrown into confusion after it emerged a £3.6bn pot must be shared with cities.

The admission came as an embarrassed minister defended launching his “countrywide town tour” in Wolverhampton – a city of 250,000 people which was awarded city status a full 20 years ago.

Robert Jenrick, the communities secretary who was born and educated in Wolverhampton, denied he had blundered, saying he was fully aware it “was a town and is now a city”.

But he argued it and other “smaller cities” also deserved to receive up to £50m each to improve transport and parking and to convert empty shops into housing.

Interviewed on Sky News, Mr Jenrick was told the announcement appeared “confused” and asked – given the ‘towns fund’ was unveiled in Wolverhampton – if he even realised it was a city.

“I went to Wolverhampton because Wolverhampton is one of recipients of the towns fund,” he argued.

The criteria were “‘not as crude” as whether a place was a town or city, but was “based on population size,” he argued – although Wolverhampton is the 11th biggest city in England.

The Conservative manifesto had promised the cash would go into “regenerating towns”, with residents given the power to make them “great places to shop and eat”.

The prime minister then went on to stun Labour by seizing many long-held constituencies in towns in the North and Midlands, including Bury, Darlington, Bishop Auckland, Worksop and Grimsby.

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Tim Farron, the former Liberal Democrat leader, accused ministers of “duplicity” for political gain.

“Just how out of touch is this Conservative government with our communities and their needs?” he told The Independent.

“Tory ministers are prepared to ignore hundreds of under-served towns to instead fund larger cities for political expediency.”

And Claire Darke, the mayor of Wolverhampton, said: “My concern would be that this competition is politically motivated and that they are doing it because there is a tough fight next year to vote for regional mayor for the West Midlands and they are trying to attract support.”

The fund will hand up to £50m each to 100 ‘towns’, with Mr Jenrick announcing a separate ‘Town of the Year’ government competition.

The minister said the cash would help with projects to boost walking and cycling into town centres, improved car parks, park-and-ride projects and to enable more people to live in centres.

Asked why the West Midlands city had been called a town, Mr Jenrick said: “Most people in Wolverhampton do call the city centre the town centre.