Debts dog fame school

The Liverpool fame school founded by Paul McCartney remains in limbo, despite its patron's recent knighthood.

Debts of more than Pounds 7.5 million last year put the Liverpool Institute of Performing Arts at loggerheads with building contractors, which it blamed for a huge overspend on renovations.

Private sponsors, believed to include Sir Paul, have since made up Pounds 4.5 million of this sum and the institute is hoping to receive the remaining Pounds 3 million from public money within two months. Until then finances remain rocky and final refurbishment work cannot go ahead.

Lipa is still considering whether to take legal action against those involved in renovation works of more than Pounds 15.5 million.

The institute was heralded as an exciting example of private and public sector cooperation, with funding from Liverpool City Challenge, the European Regional Development Fund, the National Lottery and private supporters including the Queen.

It was founded in an old 1825 grammar school building, once attended by Sir Paul and fellow Beatle George Harrison, and welcomed its first students two years ago this month. The Queen conducted the opening ceremony last June. It has proved popular, receiving about 20 applications a day for 200 first-year places.

Paul McCartney, who put Pounds 1 million into the project, retains close links with Lipa and has recently started working with students on a show.