Contractors and consultants out of pocket on Bristol Harbourside, Sheffield pop museum and Stoke theatre.
Contractors and consultants are trying to recoup millions of pounds of outstanding fees on Arts Council-funded lottery projects across the UK, it emerged this week.

Firms on the abandoned £89m Harbourside Centre in Bristol and the £17m pop museum in Sheffield were this week asked to write off millions of pounds of fees on projects underwritten by the Arts Council. Meanwhile, architect Levitt Bernstein is battling to recoup fees on the £22.8m redevelopment of the Victoria Hall and Regent Theatre in Hanley because of a fee dispute with Stoke-on-Trent City Council. The dispute has gone to arbitration.

On the Habourside Centre, a deal to pay back some of the fees was worked out by accountant Deloitte and Touche and put to creditors on Monday. The project was abandoned in 1998 because of a change to the Arts Council’s funding policy.

Under the creditors’ deal, firms have been asked to accept 50p in the pound out of the £2.8m owed to them. The offer followed an Arts Council announcement that the centre would release £1.4m from the £2.15m outstanding from its £4.3m development grant.

One of the firms hit hardest by the deal is German architect Behnisch & Behnisch, which lost £400 000 on the project. Partner Stefan Behnisch said this week that he would never work with the Arts Council again. “The Arts Council shields itself from losses by a shell company that they dump. For a public body to leave this kind of mess is unforgivable, irresponsible,” he said.

However, he added that it would not put him off working in the UK. The design team, which have all made losses, includes structural engineer Buro Happold, services engineer Max Fordham & Partners, QS Gleeds and theatre consultant TPC. These firms lost tens of thousands of pounds.

Another major creditor is interactive science centre Explore@Bristol, which was to have shared the costs of an underground car park with the Harbourside Centre, but will now have to pay the whole cost.

On the Sheffield project, confirmation of the deal for creditors came on Tuesday. The museum ran into trouble when visitor numbers failed to match those estimated in the business plan and insolvency procedures were started.

Firms out of pocket on the scheme voted to accept part-payment of the £500 000 they are owed. The firms are contractor HBG, architect Branson Coates, QS Davis Langdon & Everest and project manager Citex and Phillips Special Projects. Under the deal, they will be paid 10p in the pound. The centre operator, Music Heritage Enterprises, had agreed that if more than 150 000 a year visited the museum, it would pay creditors £1 for every extra person. This will now be in place for five years rather than three.

On the third lottery project, Victoria Hall and Regent Theatre in Hanley, architect Levitt Bernstein faces legal costs of up to £800 000 and hundreds of thousands of pound of fees.

The scheme received a £14.8m grant from the Arts Council. It was completed by contractor Norwest Holst in July this year, after Levitt Bernstein and services engineer Max Fordham & Partners left the project in February 1999. Max Fordham is facing losses on the project.