LIVERPOOL’S much-delayed Garden Festival project was dealt a fresh blow after the charity tasked with managing the site, Groundwork Merseyside, collapsed into administration.

Groundwork Merseyside had been appointed by the Land Trust to oversee the day-to-day running of the 90-acre Otterspool site.

But the city-based environmental charity called in administrators after a unsustainable cull in its funding.

All but four of the company’s 30 staff have lost their jobs.

Groundwork’s collapse is the latest in a series of setbacks that have scuppered progress at the gardens, which have been unused since 1985.

Plans to build 1,374 new homes at its associated residential scheme were put on hold when contractor David McLean collapsed in 2008 – only for its replacement Mayfield Construction to follow a similar path last July.

The Land Trust said the planned opening of the former International Garden Festival site in spring would not be affected by Groundwork’s demise.

But there is now a race against the clock to find a new management company.

Land Trust chief executive Euan Hall said: “While it is desperately sad to see yet another organisation fall foul of our current economic climate it is still our intention to open the gardens as soon as practical completion has been achieved and the site has transferred to us.

“We are reviewing alternative management options currently but we must stress that this will not affect the scheme in any way.

“We still remain committed to ensuring that Festival Gardens becomes the iconic site that the people of Liverpool deserve.”

Groundwork passed a “rigorous” application process to be selected as the garden’s managing agent.

But the environmental charity, the largest of its kind in the city region, said funding cutbacks ultimately proved fatal.

A statement read: “The funding landscape for charitable organisations has changed beyond recognition in the past 18 months and it has become impossible for Groundwork Merseyside to continue trading.

“Groundwork Merseyside is part of the Federation of Groundwork Trusts and it is hoped that the charitable work taking place in communities around Merseyside will continue but will be managed by neighbouring Groundwork offices.”