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A major financial backer of the regeneration of Dreamland has thrown its weight behind the project despite the emergence of documents showing it raised “significant concerns” about the process of appointing the management of the theme park.
The Heritage Lottery Fund awarded £5.8 million for the restoration of the tourist attraction in Margate but said it was kept in the dark about its progress despite “repeated requests” to be kept in the loop.
In a letter sent in April last year, the body sought an urgent meeting with Thanet council’s acting chief executive Madeline Homer and its then leader Iris Johnston to discuss the management of the park, which revealed debts of nearly £3 million less than six months after opening.
The fund raised concerns about the way Sands Heritage Limited, the park’s operator, had won the contract to manage the site and said it had been “effectively shut out at key stages in the project’s development”.
Last month the Margate-based company revealed it had built up debts of £2.9 million as Dreamland struggled to attract visitors in a summer blighted by transport problems caused by Operation Stack.
It later agreed a five-year repayment plan with its creditors, with its first contribution not due for 18 months.
However, the Heritage Lottery Fund has since backed the project after its letter was revealed following a Freedom of Information request by Thanet businesswoman Louise Oldfield.
A Heritage Lottery Fund spokesperson said: “Questions around the procurement process were quickly answered allowing the project to move forward.
“Complex regeneration projects like Dreamland can often present challenges as they move towards delivery.
“Dreamland has already brought jobs and tourism to Margate and will continue to deliver a huge amount for the local community. We continue to offer Dreamland and Thanet District Council our full support.”
The Heritage Lottery Fund had raised questions about the way Sands Heritage Limited was awarded the right to manage the attraction.
The body originally agreed to contribute lottery cash to the Dreamland Trust – the organisation which led the campaign to save the attraction – in partnership with the council.
The process of selecting an operator to run the park on their behalf was originally scrapped after only receiving one application, then was awarded to Sands Heritage Limited after more companies showed an interest.
However, Heritage Lottery Fund’s head of South East operations Stuart McLeod said in a letter that “despite repeated requests, we have not received any information outlining how this exercise was handled, and how the final selection of operator was made”.
He added: “As things stand, we cannot approve the procurement of Sands Heritage Limited without a clear explanation of how this process was conducted in open competition, following the receipt of a number of expressions of interest.”
A spokesperson for Thanet District Council said: “The council convened a meeting with the Heritage Lottery Fund with immediate effect to discuss their concerns.
“The council had understood that it was complying with the requirements and had been providing reports and updates on progress.
“Given the significance of the partnership with the Heritage Lottery Fund as a major investor and the complexities of the multi-million pound project, the council was keen to address any concerns which were quickly resolved.
“The council has a positive working relationship with the Heritage Lottery Fund and is delighted that the first phase of this major regeneration project for Margate is helping to raise the profile of the district and bringing more visitors and business opportunities to Thanet.”
Sands Heritage Limited and Dreamland chief executive Eddie Kemsley said: "Sands Heritage Limited has not been privy to written communications between Heritage Lottery Fund and Thanet District Council.
"Today was the first time we have seen the letters in question.
"The tender process to operate Dreamland was won by Sands Heritage Limited through merit after we submitted a thorough and robust application and pitch.
"We have since demonstrated our commitment and belief in Dreamland by becoming the largest financial investor in the project, by employing staff, buying assets and developing the park and rides.
"However, this belief has come with substantial risk to Sands Heritage Limited – whilst the business plan we submitted at tender was sound, due to circumstances beyond our control we were not able to deliver fully in 2015.
"We are confident in our management of the business and our plans for 2016.
"We remain committed to local community and education directives with the Dreamland Trust to deliver Heritage Lottery Fund objectives.
"We intend to continue to do so and are grateful for the increasing positive public support that is behind us."