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Charitable trust to axe folk festival funding

LOCAL grant funding for one of the most popular events on the islands’ social calendar, the Shetland Folk Festival, is to be reduced to zero over the next four years.

Shetland Charitable Trust’s £18,000-a-year grant towards the festival’s running costs will decrease gradually until 2020, when it will no longer be supported.

The news was confirmed in an email to festival members sent out on Thursday afternoon – a week after SCT trustees agreed in private to a package of £2 million-worth of spending cuts over the next four years.

That will have a significant impact on funding for the three big trusts – amenity, arts and recreational – as well as rural care homes and a raft of smaller organisations reliant on SCT funding. The detail of those cuts is yet to be spelled out publicly.

In a short statement on Friday the charitable trust said it had agreed a set of principles focused on supporting services provided by the three large trusts and “where possible” people in need through age, disability or circumstance and organisations which support such individuals.

Charitable trust chairman Bobby Hunter said trustees “want to direct the funding to activities which will improve the lives of the people of Shetland”.

Mhari Pottinger of the Shetland Folk Festival

Long-standing folk festival committee member Mhari Pottinger said she was “disappointed” with a cut amounting to 12 per cent of the highly regarded festival’s £150,000 annual operating costs.

But she is hopeful other avenues can be found to ensure the voluntary committee can continue delivering high-quality fare in future years.

The first cut, expected to be around a quarter of the £18,000, will impact on the 36th festival. It takes place from 28 April until 1 May 2016.

“Obviously we’re disappointed that the charitable trust is withdrawing their funding,” Pottinger said.

“But we do appreciate the fact we’ve been given four years and they’re going to do it gradually over that time.

“It gives us time to plan, review how we do things and hopefully find alternative finance to fill the gap.”

The folk festival already receives £9,500 a year from Creative Scotland, and approaching the national body for extra money may be an option. The same body has contributed £35,000 towards the JAWS Festival, which kicks off this weekend.

However Pottinger warned: “They generally look for there to be a local funder, so hopefully that won’t become too much of an issue – the charitable trust is our only local funder at the moment.”

She added that the festival committee had viewed the SCT arrangement as “a service level agreement”.

“We’ve been delivering an event for the Shetland community in return for that, and hopefully the Shetland community has been getting a substantial return on investment for that grant.

“We have to remain optimistic. The festival will still go on, we just have to start planning for the future.

Charitable trust chairman Bobby Hunter.

“Twelve per cent is not an insignificant amount to try and find. If we look at attracting more sponsorship, if we can lever in any more grant income, possibly look at reviewing ticket prices, hopefully we can stay as we are and it won’t have an impact on how we operate the festival – including all the free events we do for the community.

“We have to do everything we can to fill that void.”

In an interview with Shetland News earlier this week, Hunter said its general manager Ann Black was holding meetings with the various organisations affected to explain the impact of its decision to reduce spending to £8.5 million a year.

But Hunter said there were no plans to spell out the precise detail of where the axe will fall until grant awards are made early in 2016. On Thursday Black said she “can’t provide that level of detail”.

Last year the trust made £8.4 million in dividend income from its stock market investments, its return on local investments through district heating company SHEAP and property arm SLAP, and rental income from Sullom Voe.

But that figure does not include capital growth in its investments on the stock market, which in 2014/15 amounted to an unusually high yield of some £20.2 million.

It means the overall size of the trust’s money pot has shot up from £222.3m to £240.6m. Black confirmed this week that any capital gains over the next four years would be banked with the hope of being able to increase spending from 2020 onwards.

Hunter said: “Our advisors, in the City of London, say we think you can get £8.5 million out of this. For the last years there’s been no increase in funding for the trust, which means the real value of our contribution to outfits has been decreasing by the amount of inflation.

“The aspiration of £8.5 million by 2020, and then start increasing it by inflation every year – that would make groups in a better position after 2020.”