Labour holds key to funding for millennium exhibition

The fate of the Greenwich exhibition dome hangs in the balance as negotiations between Tory ministers and their Labour counterparts take place today.

In a bizarre political role reversal, Labour is trying to prevent too much money being guaranteed to the exhibition's organisers, Millennium Central, while Michael Heseltine, the Deputy Prime Minister, is desperate to see all obstacles removed to his cherished project. Mr Heseltine and the National Heritage Secretary, Virginia Bottomley, are due to negotiate with Jack Cunningham, Labour's heritage spokesman, today over the future of the project.

A source close to the commission said: "It's all in Dr Cunningham's hands. He could scupper it completely if he wants to." The fact that ministers are forced to negotiate with Labour over the future of the scheme shows the extent to which even the Tories consider Labour to be the government in waiting.

The Millennium Commission met yesterday and gave an "in principle" go- ahead to the plan to hold an exhibition at Greenwich to celebrate the millennium. However, the commission, which was delighted by the ideas for the exhibition, based on the theme of "Time" - put forward by the designers, Imagination - is refusing to sanction the full estimated pounds 700m budget. If severe cuts are imposed, it will threaten the grandiose idea of enclosing the whole exhibition in a massive temporary glass dome. Any major redesign could make the deadline impossible to meet.

Yesterday, Mr Cunningham refused to endorse the request by Mrs Bottomley for what he called "unlimited further expenditure" on the plan. Mr Cunningham said in a letter to Mrs Bottomley that while he supported the proposal to hold the exhibition at Greenwich, "costs have risen dramatically" and "there is a serious substantial cash shortfall". He said "it would not be prudent or proper stewardship of the people's money to agree to an open-ended commitment".

Specifically, Mr Cunningham does not want to see funds raised by the lottery continue to flow indefinitely to the exhibition after 2000. He says that the budget of pounds 700m is an underestimate with costs expected to be pounds 900m. However, he is prepared to allow "a limited amount of cash to be made available against which Millennium Central Ltd could borrow to finance the exhibition".

The commission has already promised pounds 200m but funds from sponsors, who are expected to contribute pounds 150m, are dependent on guarantees that the scheme will go ahead.

One source close to the organisers said: "Dr Cunningham is being deliberately obstructive in raising matters such as inflation which is very low, and tax liabilities which don't seem to be relevant."

Nevertheless, the organisers hope that a final go-ahead will be given today, as any further delay in funding may make it impossible to meet the deadline.