Marketing Edinburgh, the agency that promotes the city to the world, has lost a third of its funding after councillors voted through a raft of controversial spending cuts.

The body, which includes Convention Edinburgh – the business tourism unit – will lose £300,000 of its £890,000 budget in the next financial year, with a stipulation that it must produce a ‘business plan’ to transition to transition to ‘zero funding’ from the council.

The controversial plan, which was announced just four weeks ago, prompted the second highest level of opposition in a public consultation process, which closed on February 11. Edinburgh City Council was forced to rethink its original plan – to cut the budget by £790,000 – after 153 people responded to the proposal to voice their concern that Edinburgh would be the “only major developed city not to have its own destination marketing organisation”.

Following the City of Edinburgh Council Budget vote to pass the coalition motion yesterday (THUR), which included a Marketing Edinburgh ‘counter proposal’, Gordon Robertson, Chair of Marketing Edinburgh, said: “In recent weeks, Marketing Edinburgh has worked hard to develop and submit what we believe is a viable counter proposal to City of Edinburgh Council’s proposed budget cuts. We will now move forward to focus on the next step in the evolution of Marketing Edinburgh to become a destination marketing management organisation.

“That said, £300K is a significant cut and will need to be managed carefully. Our focus now will be to co-produce an appropriate business model which continues to deliver our services to the City of Edinburgh and our members within the revised budget. Private sector funding and collaboration with our members are an essential component.

“Marketing Edinburgh exists to promote what’s in the best interest for Edinburgh and our members, and we shall continue our efforts to sustain Edinburgh’s reputation as one of the best places in the world to live, work, invest, study and visit.  

“On behalf of the Marketing Edinburgh Board and our members, I want to extend our thanks to all our partners and peers from across tourism, hospitality, marketing and film industries, as well as the city’s academic and business leaders, for their support in recognising the critical role we have played in the city’s success to date. It is greatly appreciated.”

The spending cut was passed by councillors, who must deliver £40m of savings from the entire city budget next year. Marketing Edinburgh is holding a board meeting today (FRI) to discuss how to proceed; it is understood that the business plan must be produced by April 1 in order to secure the reduced settlement, which applies for only the next 12 months. Beyond that it is expected Marketing Edinburgh must be self-sufficient. It is unclear whether the body will remain as an ‘arms length organisation’ (ALEO) of the council or what will happen to its staff.