Theatre by the Lake is being forced to make staff redundancies to ensure its survival post Covid-19, following the announcement that the government is phasing out its furlough scheme.
The Keswick venue has said it will continue to maintain and manage the theatre with a smaller team, who will plan for a reopening in the future.
It is considering "significant staff redundancies" to reduce annual payroll costs of nearly £1 million and will be consulting with staff over the next two months.
According to a press statement, the theatre’s leadership has "reluctantly concluded that the best way to preserve jobs in the long run is to ensure the company comes through this crisis".
Having already cancelled its summer season, Theatre by the Lake has now announced the cancellation of its Christmas production, The Borrowers. The venue said it has "no confidence in audience numbers returning to sustainable levels by Christmas".
The measures follow the announcement that the government is to phase out its Coronavirus Job Retention Scheme, which has allowed companies to claim up to 80% of wages for staff put on paid leave. The scheme will end in October, with companies having to start paying national insurance and pension contributions from August and a percentage of the wages from September.
Theatre by the Lake has said public funding accounts for 20% of the venue’s turnover, making the venue heavily reliant on income from ticket sales.
Executive director James Cobbold and artistic director Liz Stevenson said in a statement: “Our industry is facing an exceptionally challenging situation for the foreseeable future.
"We’ve come to the incredibly difficult conclusion that we have to take action now to ensure Theatre by the Lake survives this challenging period of disruption and uncertainty.
"If there is to be theatre in Keswick, and if we are to provide employment opportunities in the future, then we have no choice but to consider these actions in the short term."
The statement added: “For the theatre industry to survive this crisis, we must see further investment quickly.
"Over recent years, theatres have worked hard to operate on reducing levels of public subsidy by increasing their reliance on high ticket sales and as a result are at greater threat in this unprecedented crisis."