Questions raised over Ty Siamas folk centre jobs plan
Questions are being asked about £1.2m spent in public money to set up a national folk music centre in Gwynedd.
AM Darren Millar said the way officials assess business plans is "flawed" amid claims that Ty Siamas in Dolgellau failed to live up to its promises.
There were hopes it would sustain 19 jobs but it now employs two part-time.
The company running the centre said it is meeting its obligations and the Welsh government said the project had met its main targets.
But Mr Millar, chair of the assembly's public accounts committee, told BBC Wales that projects like Ty Siamas - the National Centre for Welsh Folk Music - need to face far more robust tests before grants are awarded in the future.
Mr Millar said: "You've got to ask the question how realistic was the proposal - how realistic was it that you're going to have an arts centre in what is a reasonably sized town in north Wales, but small by the standards of the country as a whole, and I think it's really important that these business proposals - whenever anybody brings them forward - are properly tested in the future, and this is a case in poor testing."
European and Welsh government funding helped to set up the project six years ago via the latter's Welsh European Funding Office (Wefo).
BBC Wales has learned that Ty Siamas' interactive folk music exhibition has closed down due to lack of public interest, and the centre only employs two part-time members of staff.
The shop space, which once sold folk music and instruments, has been leased to a local craft company, and the project's online shop lies dormant.
Ty Siamas - named after the 18th Century harpist Elis Sion Siamas - was described in 2007 as "an unique and pioneering development within Wales taking the public on a journey through the history of folk music by using modern technology and interactive presentations".
The centre also includes an auditorium, a sound studio, and a bar.
Concerts and music lessons are occasionally held at the centre, but the interactive exhibition space has now been turned into a performance room and meeting space for the local community.
Siamas Cyf, the not-for-profit company behind the project, estimated that the centre's economic benefit to the local economy would be nearly £10m over 10 years.
It was supposed to lead to the creation of 19 jobs in the Dolgellau area, with five jobs located at Ty Siamas itself.
The directors of Siamas Cyf told BBC Wales that it became clear fairly early on that the main revenue of paid entry to the exhibition was not going to be realised.
In a statement, they said: "Ty Siamas is here today because the directors acted in order to protect the asset for the community by changing and adapting some of the elements of the original business plan which proved to be defective.
"Ty Siamas in now free of any financial obligation to our grant providers and we are succeeding in meeting our running costs.
"We succeeded to continue with an employment target of five direct jobs for a long time.
"We are supporting the livelihood of four music tutors who offer lessons in Ty Siamas, along with supporting local businesses in terms of hostelry and catering.
"After trying to protect the existence of the shop for years, despite strict Wefo regulations, we were not in a position to subsidise it any longer and so the space is rented out to a local venture."
Ty Siamas is located in Neuadd Idris Hall, a prominent building in the centre of Dolgellau, which dates back to the 1870s.
Neuadd Idris is owned by Gwynedd council, which is leasing the building for a £1 peppercorn rent to Siamas Cyf for a period of 100 years.
Gwynedd council told BBC Wales that it was a matter of disappointment the company had not fully achieved what had been proposed in the original funding application to the Wefo.
A Welsh government spokesperson said the primary aim of Ty Siamas was to bring a redundant building back into economic use.
"The key focus of the project was the capital development of the centre," said the spokesperson.
"The creation of 19 jobs was not a target for the EU-funded project. Wefo assessed the project's ability to deliver its targets through a range of measures, including checking its financial viability at the time."
It also sought advice from an advisory group.
"As with all EU projects, Ty Siamas was subject to on-going monitoring as well as inspection visits," added the spokesperson.
"Wefo was content that the project achieved its primary objective of establishing a centre for music and cultural activities for the benefit of the community and visitors."