Hampstead Theatre started the year on a high, with the gala opening of its ambitious new £15.7 million state-of-the-art facility. It's ending the year in crisis, a series of critical brickbats and financial wobbles culminating today in the resignation of executive director James Williams and a programming rejig as a full Organisational Review gets under way care of Arts Council England (ACE).

The depth of Hampstead's financial crisis emerged last month when the Times reported that the theatre had appealed to ACE for an estimated £500,000 rescue package (See News, 7 Nov 2003). ACE has now stepped in with the necessary funding that will see Hampstead continue as a new writing theatre under the artistic directorship of Anthony Clark, who took over from Jenny Topper this past July. However, a wide-ranging review of its operations is now being launched.

In a statement, Vincent Wang, chairman of Hampstead's board of directors, said: "Since the new theatre opened in February 2003, it has become clear that our original plan for the organisation is unsustainable, and we must move quickly to find a way forward which will ensure its future."

That future will now no longer include Williams, who simultaneously announced his resignation after five years in the job. His leaving was lamented by playwright Michael Frayn, chairman of the Hampstead Theatre Foundation, who commented: "Without James there would quite simply be no Hampstead Theatre - no new building, because we should never have got it up, and no old one either, because it would long since have been closed down. We owe him a huge debt of gratitude."

A commentary by Norman Lebrecht in last night's Evening Standard suggests that ACE itself should be largely blamed for the current situation - it approved Hampstead's redevelopment, backed by £10 million of Lottery funding - and accuses it of victimising a popular Williams, whose departure was made a condition of the rescue cheque.

"What happened in Hampstead is an abuse of process in which ACE played prosecutor and judge in a trial where it should have been co-defendant," writes Lebrecht, who goes on to denounce the Council as "an all-powerful, wholly unaccountable" body that "behaves like a tinpot tyranny, destroying careers without conscience or impediment."

For theatregoers, the most immediate effect of the current organisational wrangles is a change to the programming schedule (See News, 1 Jul 2003). Hampstead's next scheduled production, a first play by a Canadian poet living in London, has been postponed until sometime in next autumn's schedule.

The world premiere of Drew Pautz's All This Stuff, about a struggling artist and her sportswear salesman boyfriend, was due to run from 11 February to 6 March 2004 (previews 5 February). Instead, the theatre will go dark for a few weeks after the run of its current production, Stephen Lowe's Revelations, due to finish on 31 January 2004.

The world premiere of When the Night Begins - the latest play by Hanif Kureishi, directed by Clark - will then commence on 1 March 2004, two weeks earlier than originally planned, and will continue to 3 April.

It will be followed by Follow My Leader, a new political satire about the Iraq situation by Feelgood's Alistair Beaton, which will transfer from Birmingham Rep and run at Hampstead from 21 April to 22 May 2004. The transfer from the Liverpool Everyman of Dael Orlandersmith's Yellowman is then expected for a month's run from 24 May, though exact dates are still to be confirmed.

- by Terri Paddock