A council loaned organisers of the Midnight Sun Weekender in the Outer Hebrides £150,000 three months before it pulled the plug, it has been revealed.
Western Isles Council says it has been “reassured” it will get the money back.
The Midnight Sun Weekender in Stornoway was to open on Thursday and feature legends John Fogerty, The Pretenders and Primal Scream.
It was axed barely a week before it was due to open. Fans have taken to the festival’s Facebook to complain of the late decision which has cost them accommodation, flights and ferry bills plus taking time off work.
Fans from as far away as Australia had bought tickets.
Organisers had previously revealed that half of the sales have come from off-island.
Everybody who had bought a ticket would be refunded, said organisers.
Loan to Midnight Sun Weekender backed by councillors
Western Isles Council said it approved the £150,000 loan to the Midnight Sun Weekender on February 15.
It stressed that it has been a long-time supporter of a range of festivals across the Outer Hebrides providing significant year-on-year grant support.
“These festivals bring a variety of economic, social and cultural benefits to the area,” it said in a statement.
“When the promoters of the Midnight Sun Weekender approached the Comhairle (council) for assistance a detailed business and marketing plan was submitted.
“This suggested that the festival could sustain borrowing support and as such a loan rather than grant package of support was agreed. The agreed borrowing is supported by a legal undertaking.
“A loan of £150,000 plus interest, backed by a guarantee was issued to Midnight Sun Festivals Limited. The decision to authorise the loan was made by full Comhairle on February 15.
“On the news breaking that the festival was to be cancelled, the Comhairle met with the promoters to seek reassurance that full refunds would be provided for those who had bought tickets and that the Comhairle’s loan investment was safe.
“Reassurance was provided regarding these two issues and repayment of the loan will commence, in due course, to an agreed schedule.”
Organisers said cashflow and poor ticket sales was why the festival was axed.
A statement said: “Rising costs and limited availability on festival infrastructure, as well as the cost of living crisis having an impact on ticket sales means that we are not in the position to deliver the event that we had hoped to bring to our beautiful island.”
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