Economic regeneration agency says cuts in council funding have create ‘challenging financial environment’.
North Devon+ is reducing staffing levels following a ‘significant’ cut in district council funding.
The economic regeneration agency says it needs to restructure the business to survive, and has issued redundancy notices to five people this week.
Grants from North Devon and Torridge district councils will be reduced by £165,500 in the forthcoming financial year.
In 2016/17, North Devon contributed £127,500 towards core funding, while Torridge gave £78,000.
This year, each local authority has agreed to contribute just £20,000, although both will continue to fund £15,000 towards Leader 5, a £2.3million North Devon rural development funding programme run by North Devon+.
Co-director Mike Mansell told the Gazette: “Some redundancy notices have been issued as a result of a reduction in core funding from both local authorities.
“In essence, we are restructuring the business so it can survive. There will still be a North Devon+ but with a reduction in staffing levels.”
Mr Mansell said that ultimately, staffing levels would be reduced from 16 posts in July last year to 10 posts.
But because some positions were already vacant, three new posts will be created as part of the restructure; an administrative role, a business adviser and a corporate finance and contracts manager.
“Initially these roles will be ring-fenced for the people who are being made redundant,” added Mr Mansell.
North Devon+ was established in 2007 as part of a merger of the North Devon Marketing Bureau, North Devon Enterprise Agency and North Devon Regeneration Company.
It helps attract grant funding to the area and supports local businesses and apprenticeship schemes.
Income was also secured through project managing funded programmes, plus commercial income but the majority of income has come from local authority grants, which have reduced over time due to a strain on council budgets.
A spokesperson said that a ‘range of scenarios’ had been discussed due to the ‘challenging financial environment’ but the preferred option was to focus on delivering externally grant funded activity.