A small voluntary sector training organisation will close at the end of month because a local authority has reneged on a contract to pay match funding for a European project.
The Training for All Foundation in West Bromwich says it is owed more than £95,000 by Sandwell Borough Council, which agreed to cover 55 per cent of the cost of a three-year e-learning programme, but has refused to pay up.
"We need action quickly," said project officer Kevin Priest. "If the money is not forthcoming we will have to close. We have used all of our reserves and have no money left to pay staff."
In 2003, the charity successfully applied to the Government Office of the West Midlands for European Social Fund money to train disadvantaged and hard-to-reach groups. But European money provided only 45 per cent of the cost. Sandwell Borough Council agreed to supply the remainder and signed Public Match Funding Certificates.
But more than two years into the project, the charity has not received any of the £129,000 funding due from the council. Borough officers claim the council's only obligation to the charity was to pay a Service Level Agreement to provide training to the local voluntary sector, but Training For All says this is an entirely separate contract.
"Sandwell Borough Council has expected a small charity to make up this huge deficit," said a foundation spokesman.
The council said it was investigating a number of issues raised by the charity.