The new museum is planned to add a new dimension to Liverpool's famous waterfront. Courtesy National Museums Liverpool.

The possibility of Liverpool getting a new waterfront museum has greatly increased following the announcement of a major grant by the Northwest Regional Development Agency.

Subject to further finance from the European Objective One fund, the NWDA has pledged £2.5 million towards the cost of developing a proposal for a new Museum of Liverpool.

If successful the proposal will see a new institution built as part of a larger visitor attraction at Mann Island on the city’s historic waterfront.

"We are excited about the real prospects now for the development of the Mann Island site," said David McDonnell, Chairman of National Museums Liverpool.

"The NWDA board decision means that we can now work towards making a spectacular contribution to Liverpool’s renaissance and the region’s cultural and tourism economy."

The Museum of Liverpool Life will become part of the new museum. Courtesy National Museums Liverpool.

Until July this year, the site was to be used for a landmark Fourth Grace development, but massive changes to the scheme led to the city council and other public partners abandoning it as no longer viable.

This new funding will be used to cover costs incurred in the development of a complete and thorough new proposal for the site.

Each of the public partners that worked on the original development, Liverpool Vision, Liverpool City Council and National Museums Liverpool will now work on the new one.

A full appraisal of it will be undertaken in May 2005 to make sure that all of the key objectives can be met. Most importantly, this will include a risk assessment that considers value for money and the likelihood that the development can be delivered on time and within budget.

Describing the announcement as an "important step forward", Chief Executive of the NWDA, Steven Broomhead confirmed his organisation’s support for the scheme.

"The decision by the public sector partners in July not to proceed with the Fourth Grace project provided an opportunity to take a fresh look at development options for the Mann Island site," he said.

It is hoped that the new museum could be ready in time to complement Liverpool's many other institutions during its year as the European Capital of Culture. Courtesy National Museums Liverpool.

"However," he added, "there is still a lot of work to do, the proposals must be able to prove beyond doubt that the project can be delivered on time and to budget, delivering a unique and inspiring visitor attraction with regional economic benefits."

If successful, the new development will incorporate the current Museum of Liverpool Life, which is located on the Mann Island site.

Other plans include extending the Leeds/Liverpool Canal to the Pier Head and creating a public space for events.

"This is an important step forward for this key site," said Liverpool City Council Leader Mike Storey.

"We now look forward to a high quality development to be delivered in time for 2008 – Liverpool’s Capital of Culture year."