An award-winning charity for people living with HIV is under threat of closure after losing its core funding from the Scottish Government.

HIV Scotland, which has received around £270,000 a year from the Government, informed supporters it had been unsuccessful in a recent bid for resources and had to make redundancies.

The Edinburgh-based body, which has been left “completely shocked” by the decision, is relying on interim funding but is running out of money.

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Kezia Dugdale, a Labour MSP for Lothians, said: “This is deeply troubling news and I share HIV Scotland’s anger that it is faced with major funding concerns. I urge the Scottish Government to ensure the organisation has the funds it needs to continue that vital work.”

Liberal Democrat MSP Alex Cole-Hamilton said: "This is a body blow to an organisation with a phenomenal record of empowering people, fighting for better treatment and raising awareness of this condition. I will be speaking with HIV Scotland and pressing the Scottish Government to reconsider this appalling decision."

Since its establishment in 1994, HIV Scotland has received financial support from the pre-devolution Scottish Office as well as the Scottish Government.

The charity’s work is said to have been pivotal in Scotland making progress on HIV–related issues such as increased testing and treatment services.

In November, First Minister Nicola Sturgeon was praised after HIV Scotland chief executive George Valiotis helped her take an instant test in public.

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However, in an update to friends of HIV Scotland, Mr Valiotis has warned that the charity is in jeopardy after losing funding from the Government.

The email, leaked to this newspaper, stated: “HIV Scotland has undergone significant challenges since we lost our core government funding which initially resulted in the Involvement Officer post being made redundant.

“Subsequently both our Policy Officer and Communications Officer roles have been lost. These redundancies have left the organisation critically short staffed.”

Mr Valiotis wrote that the Government had announced “changes to its funding priorities”, which included resources once given to HIV Scotland and other groups being put out to public tender. He added the charity had been “unsuccessful”.

Although he said HIV Scotland is in “positive discussions” with the Government, the chief executive wrote that the “loss of staff” and the “new limitations put on us” in relation to potential future funds meant the charity is “at risk”.

He added: “We are naturally completely shocked by this decision because it came at a time where we were recognised in an award by the British Medical Association for an outstanding contribution to improving sexual health across the United Kingdom.”

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Mr Valiotis added that the charity has to develop another business case for the Government imminently, but he wrote:

“The feedback we have had so far is that it must be for an amount well below what we’ve had previously, for probably 2 or 3 staff, instead of the seven we had previously, for probably 2 or 3 staff, instead of the seven we had previously. My view is the minimum we need to do the work we always done so successfully is seven core staff.”

The charity has obtained some external funding, but Mr Valiotis warned: “If we can’t secure ongoing Government support, these projects that could deliver substantial benefits for people accessing services across Scotland won’t go ahead.”

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Scottish Greens MSP Patrick Harvie MSP said: “It is deeply disturbing to see an organisation with HIV Scotland’s track record and importance threatened because of the loss of funding that is, in the context of the Scottish Government’s budget, such a modest amount. To endanger their work would be unforgivable, and I am sure that the Scottish Government will be challenged from across the chamber on this.”

Mr Valiotis said: "We are in positive discussions with Government, and hope these result in sufficient funding for us to continue our important work."

A Scottish Government spokesperson said: "Following an open and competitive funding process a number of organisations were successful in securing funding to deliver key projects that support the delivery of the Sexual Health and Blood Borne Virus Framework.

“While HIV Scotland were unsuccessful in that process, we continue to work with them to develop a sustainable position for the coming years, and have provided an initial grant of £70,000 for the first four months of this year to support them achieve this and ensure that HIV can continue.”