First act over but tale of operatic woe goes on

The redevelopment of the Royal Opera House, one of the gems in Britain's cultural crown, is a saga of fiendishly complex and, opponents argue, badly mismanaged proportions.

It started in the early 1970s when a Department of Education and Science working party found grossly inadequate technical and artistic facilities at the ROH. This triggered the Government's purchase in 1975 of two acres of Covent Garden land to for the expansion of the ROH, or other arts purposes. The Arts Council and the opera house became co-trustees.

The support gave the ROH fresh hope and it launched an appeal in 1977 to raise pounds 6m for an extension. Unfortunately, the completion of the new wing in 1983 coincided with warnings that unless its Grade I listed building was completely refurbished it would become a safety hazard. It also become clear its technical equipment was near the end of its working life.

The difficulty was that the 1977 appeal had exhausted the ROH's fund- raising potential. In 1983 it presented the Government with a controversial strategy: to raise funds by building shops and offices on its site.

It was a plan which raised fierce opposition and climaxed in a 1987 High Court challenge. This was rejected by the Court of Appeal the following year, but it delayed the scheme so that it was rendered unviable by the property crash of 1989.

Following its first failure the ROH went on to prepare four successive separate masterplans in an effort to raise funds. None came to completion, while their preparation costs rose relentlessly - some claim they reached pounds 23m by 1986.

The huge sums presented the ROH board with a financing problem. Its solution was to convert half its new extension into six shops.

It was soon after that the advent of the National Lottery made it apparent that for the first time there would be enough public money to finance the redevelopment - which by now had evolved into a large-scale pounds 213m scheme.

The ROH pulled out the stops and on 4 January it submitted a bid for pounds 78.5m of lottery funding from the Arts Council. The rest of the money was to be found from the construction of more Covent Garden shops and donations.

In July it was given a pounds 55m grant with the possibility of the rest to follow. In the face of criticism, the ROH argued the award was an overdue recognition that without public funds it would become "derelict and empty - a national disgrace".

So ends the first act. But as the ROH has not yet raised the private donations it needs, nor made the pounds 65m profit it is banking on from property schemes, the play is by no means ended.