GOVERNMENT appears to have settled its dispute with the Salvation Army over funding following "frank and open discussion" on the issue.

But yesterday it was confirmed that Government will put the management of a new homeless shelter, along with various addiction programmes that the charity provides, out to tender.

Tension between the two parties rose in December after Health Minister Patrice Minors claimed she was "fed up" with the charity's repeated requests for cash.

And the row threatened to boil over last month after Premier Scott pushed allegations that the island branch redistributed some donations to offices in Canada. The Salvation Army repeatedly denied that claim.

Mrs. Minors met with Salvation Army Bermuda Division head Major Lindsay Rowe last week in an effort to defuse the conflict.

Yesterday, explaining that the misunderstanding had been cleared up, the Minister said: "It had been my understanding, from letters received from the Salvation Army, that a portion of the funds collected were sent to Divisional Headquarters. Major Rowe has explained that Divisional Headquarters is in Bermuda, not in Canada, and I am satisfied with that explanation.

"Having an open and frank discussion with our community partners has brought about greater clarity of the goals of the two organisations with regards to services provided to homeless individuals.

"Moreover, I feel that this newly researched and strategic direction will undoubtedly bring with it greater efficiency and incorporate global best practices and standards to those who continue to suffer undue hardship. This new thrust will embrace many of the goals incorporated within the Government's Social Agenda."

Major Rowe added: "My team and I had a good meeting with the Minister, and we resolved several issues. I am pleased with the results, and look forward to continuing to work with Minister Minors and the Ministry of Health and Family Services.

"The Ministry has assured us that they will assist the Salvation Army with having repairs made at the North Street shelter on a timely basis, and for that we are grateful."

Major Rowe said that he was encouraged by the initiative taken by the Government, and that he and the Salvation Army welcomed the opportunity to be involved in the project.

He said that he understood the Government's intention to invite proposals from organisations interested in either managing the facility and / or providing services to the clients of the facility.

He said: "We at the Salvation Army support this move and intend to submit a comprehensive proposal."

A Government spokeswoman added: "The Minister concluded that she feels confident that Bermuda's longstanding relationship with the Salvation Army will continue, and the community will continue to reap the benefits of this affiliation.

"The agenda of the meeting included discussions of fund-raising by the Salvation Army, the plight of the homeless in Bermuda, the current state of the North Street shelter, and plans for the future.

"The Minister underscored the Government's commitment to reducing the struggle of Bermuda's homeless citizens and to help these individuals in their efforts to restore their sense of identity and value within the community.

"She went on to say that she and Major Rowe had engaged in extensive discussions on the future plans for the North Street facility.

These plans include the construction of a new night shelter and a boarding / rooming house facility. The new facility would include space for providing life-skill and other services to the tenants.