By NEIL RIDDELL
THE funding package for Shetland’s controversial cinema and music venue Mareel is finally in place after European investment of £2.8m was confirmed this week, meaning the cost will be split 50-50 between the SIC and external sources.
A much-delayed announcement confirming the grant, from the European Regional Development Fund (ERDF), takes the total amount of funding in place for the project to £12.1m, though the delay means the projected opening date for the venue has now drifted from spring to autumn 2010. Building work at the North Ness is expected to get underway early next year.
Shetland Arts hopes that the 700-capacity, 330-seat music auditorium will become a regular stop on the touring schedules of some of the biggest names in the music industry, while there will also be a 159-seat cinema and the development agency points to potential educational benefits as well as spaces for recording and rehearsal within the facility.
It is also estimated that around 16 full-time equivalent posts will be created.
But Mareel has polarised opinion in the isles, with many people of the view that it is a foolish show of opulence at a time when the council needs to tighten its belt financially. Councillors only re-affirmed the SIC’s long-standing commitment to the project by virtue of a casting vote from convener Sandy Cluness earlier this year.
In the latest of a series of attempts by some councillors to halt the council’s support for the venue, Lerwick South councillor Jonathan Wills asked his colleagues at this week’s Full Council to review the £6.1m-worth of grant aid it has pledged to the project, a suggestion which was rejected by a margin of 13-5 with three abstentions.
Shetland Arts director Gwilym Gibbons rejected suggestions that it was the wrong time for the council to be supporting a “luxury” project given the financial constraints it is operating under and said it was “an investment at a time of absolute need”.
He said: “Mareel is about investing in the future and if it’s right for Shetland to have a purpose-built cinema, music venue and education centre, now is the time to build it – it’s only going to get more expensive.
“It’s also very important at a time like this to be investing in the local economy, for the building trade [so] that there are significant building projects are on the table. People [all over the country] are trying to bring forward capital building projects. We’re really proud to be part of that and to invest £12.1m, of which over half is coming from sources outwith Shetland Islands Council.”
In light of the “significant deterioration” in the council’s financial circumstances over the past six months, Dr Wills called for a report from chief executive Morgan Goodlad into how the council might alter its level of support and identify a modified version of the project at a lower cost.
Because such a move would go against agreed council policy, members voted on whether to suspend standing orders in order to have a discussion on the matter.
But Dr Wills was only able to muster the support of four fellow councillors – Gussie Angus, Betty Fullerton, Robert Henderson and Gary Robinson – while the three abstainers were Allan Wishart, Andrew Hughson and Cecil Smith. Councillor Allison Duncan, another vocal opponent of the project, was not present at Wednesday’s meeting in Lerwick Town Hall.
Those who voted against holding a discussion were Laura Baisley, Jim Budge, Mr Cluness, Alistair Cooper, Addie Doull, Florence Grains, Iris Hawkins, Jim Henry, Bill Manson, Caroline Miller, Rick Nickerson, Frank Robertson and Josie Simpson.
Dr Wills said: “This was the last chance not to waste all that money, because Mareel can be done for [much less than] £12m if they go about it a different way. Every time there is a problem with care centre beds, I will be reminding people who refused to vote why there is this discussion. I wanted the public to know which councillors think Mareel is more important than care centres and childcare, and now the public will know.
“It isn’t about the facilities, it’s about status, prestige, personalities, career development plans … anyway, now it will go ahead and the only way to pay its running costs will be to sack some of the people who were so keen [to see it go ahead].”
As well as a number of dissenting councillors, there has been significant concern from the licensed trade about the possible threat posed to their businesses, with a state aid complaint anonymously submitted to the European Commission in the summer. Although there has been no formal response as yet from Brussels, it is thought to be highly unlikely that state aid will pose any threat to the project’s viability.
But question marks remain over the business plan, which projects balancing the books through selling £378,000-worth of alcohol, snacks and other drinks across the bar at the venue’s café, prompting fears that public money will be required to subsidise the facility for years.
Shetland Charitable Trust has provided a commitment to underwrite any deficit in running costs, but only for the first year after Mareel opens and it seems certain that many councillors will be strongly opposed to the idea of increasing the amount of money handed out to Shetland Arts at a time when there is a pressing need to reduce draws on the council and trust’s oil reserves.
The plan is also reliant on staging 177 events annually in the music hall, assuming an average attendance of 186 people – in other words, the average person in Shetland would attend roughly one and a half musical events each year. In terms of its two screens, the intention is to more than double the amount of cinema-going in the isles to 108 people per day, compared with 52 people a day during 2007/8.
But Mr Cluness welcomed the ERDF funding news and said he was eager to see the project proceeding with haste. “I think folk are just happy to see the thing get underway now. We’ve spent far too long talking about it and hopefully this is the last piece of the jigsaw.”
Along with the council’s money, Shetland Arts has secured a £2.1m grant from the lottery fund, £965,000 from Highlands and Islands Enterprise and £50,000 from the Gannochy Trust.
Mr Gibbons said discussions with contractors DITT and architects Gareth Hoskins were ongoing to try and take advantage of changing economic circumstances, including falls in the prices of some commodities.
Once the contract is finally signed, the land at North Ness will be signed over to Shetland Arts from the council’s property arm Slap at a commercial rate, understood to be in the region of £200,000.
“There are negotiations happening with subcontractors given the change in the building market since the first submission was made,” said Mr Gibbons. “We’re working basically to make sure that the £12.1m is enough to cover every eventuality – there isn’t any other funding available locally or nationally now.
He added: “We have a duty to take advantage of the current economic position [because] the world is a very different place [and] we want to make sure that the public pound is spent in the best possible way.”