Promotion of the UK’s first City of Culture has been thrown into disarray after Derry City Council seized part-control of the company charged with running the year-long event.

The council has taken control of the company’s marketing department just days before the presentation of a full marketing strategy.

The move follows criticism of the Culture Company’s marketing strategy by the council’s chief executive, Sharon O’Connor, and will see all marketing staff except for Garbhan Downey, currently director of marketing and communications, transferred to direct city council control.

It will also see the council assume responsibility for a £1.6 million marketing budget provided by the Department of Culture, Arts and Leisure as part of a larger £12.6 million funding award.

In a statement, Downey said he was disappointed by the decision.

He added that he rejected the “council’s attempted inference that this is somehow a performance-related issue”.

“This is happening because we are refusing to allow council to spend our budget on non-city of culture projects. The reason I am speaking publicly now is that despite council statements, I have a genuine fear that our budget will not be spent in areas for which they were intended by DCAL, and that this would be a specific break of our contract with DCAL,” he said.

Defending the council’s action O’Connor said: “The plan is that we maximise our resources and that is where all this has stemmed from. It is unfortunate that it has happened in this way. It is very important to point out that I am personally responsible with making sure that the £12.6 million DCAL has provided for the City of Culture project is delivered per the letter of offer they provided to Derry City Council.”

She added that it was “factually incorrect” to suggest that “finances would be used in way other than those anticipated by DCAL for the benefit of City of Culture”.