THERE are hopes that a stunning chapel conversion in Calstock, which was the home of publishers Peterloo Poets, will remain a venue for the arts following the closure of the 33-year-old business.

The derelict chapel was converted with more than £400,000 of grant funding in 1999 to house the company set up and run by Harry Chambers to promote the work of unknown poets.

Negotiations are currently taking place with a community interest company so the building, which has also hosted literary and musical events, festivals and plays over the last decade, can continue as a place for the arts.

Speaking to the Times this week Mr Chambers, who has now moved to York, said with no guarantee of arts council funding, which was essential to Peterloo Poets, his age and health and the death of his best selling author U A Fanthorpe in April, he felt it was time to call it a day.

'Bringing the work of unknown poets to a wider audience and gaining a national and international reputation has been very fulfilling, but I am nearly 72 and had four knee replacement operations.

'There are also lots of independent poetry magazines and presses who have previously had grant funding from the Arts Council and been in a position of losing them. There was no guarantee that by filling in all the forms again for another three years funding that we would be successful.'

Peterloo Poets was named after the 1819 Peterloo Massacre in Manchester, a city where Mr Chambers spent many years as an English lecturer and started his poetry publishing business.

Poet U A Fanthorpe became a household name thanks to Peterloo Poets who published eight volumes of her poetry. In 2001 she was awarded the CBE for services to literature and awarded the Queen's Gold medal for Poetry, only the fifth woman in 70 years to get it.

The company sold paperback rights to selected works by U A Fanthorpe and children's poet John Mole to Penguin Books but despite this success and the good press Peterloo received, it was never going to be profit-making.

Mr Chambers said: 'There are about 12 independent poetry publishing houses in the UK and most of them could not survive without arts council funding. We were one of the top companies but poetry is a loss making business.

'We are hoping that a sale will take place in the next couple of months and this will ensure the chapel will continue as an arts resource for the people of Calstock. The Arts Council is very happy about this.'

Calstock resident and parish councillor Norma Greenslade said: 'It is a lovely building and should be used by the community because I understand that was what the original funding was for.'