Doomed charity ruled out public appeal to save Filmhouse cinemas and film festival

Minutes of secret internal meetings at a doomed arts charity have revealed that an appeal was decided against because it was "unlikely to succeed".

The documents, released under Freedom of Information legislation to The Ferret website, reveal the escalating financial crisis behind the scenes at the Centre for the Moving Image (CMI).

The body was put into administration in October with the immediate loss of 107 jobs, just weeks after the 75th anniversary edition of the EIFF.

An image from romantic comedy film Gregory’s Girl was projected onto the Filmhouse in Edinburgh as part of the campaign to save it

It has emerged more than 50 former members of staff are pursuing legal actions for redundancy payments after the festival and the Filmhouse cinemas ceased trading with immediate effect.

Several former staff at the Filmhouse in Edinburgh got involved in a subsequent crowdfunding campaign to try to buy the Lothian Road building out of administration. It raised more than £750,000 and secured the backing of actors Brian Cox, Jack Lowden, Sam Heughan, Dougray Scott and Peter Capaldi.

Although a closing date of December 7 was set, administrators FRP Advisory have yet to announce a successful bidder.

However, they are said to have turned down two separate bids higher than the crowdfunding total – led by Robert McDowell, founder of Summerhall arts centre in Edinburgh, and Gregory Lynn, owner of the Prince Charles Cinema in London’s West End.

The Filmhouse cinema in Edinburgh has been closed since October. Picture: Lisa Ferguson

The administrators were later unsuccessful in efforts to persuade councillors to transfer the licence for the Filmhouse building, sparking speculation that a bar or restaurant operator was the front-runner to secure the site.

More than £1 million is said to be owed to former staff and creditors in the wake of the CMI’s collapse. This is despite £5.3 million in public funding being ploughed into the CMI in the space of three years.

This includes its annual Creative Scotland grant of more than £1 million, a further £750,000 in direct government funding, £1.3m in Covid recovery support, and an additional £270,000 in “resilience” funding for the EIFF, announced by the government days before First Minister Nicola Sturgeon opened the event.

The Scotsman has previously revealed how the CMI’s accounts noted concerns around “major risks” to the future of the charity for six years before administrators were called in. The CMI’s staff were kept in the dark about the prospect of insolvency until October 6 when they were told it had already gone into administration.

However, it later emerged the Scottish Government and its agencies Creative Scotland and Screen Scotland were alerted over possible insolvency due to “significant financial challenges” threatening the charity’s viability on September 15.

Minutes of the CMI’s audit and risk committee, which met four days later, said there had been “a discussion about whether to go public in seeking help”, but it was viewed “the scale of the projected deficit is so great that a public appeal would be unlikely to succeed”.

Ken Hay, the CMI’s chief executive, had said “conversations with public funders will ascertain whether any additional financial support will be possible from those sources”. The minute adds: “He noted the political fallout that would happen if there isn’t support.”