The board meeting to be held by Creative Scotland this weekend is becoming more significant with each passing day, as what began as a row over funding threatens to spiral into wider crisis.

Scotland’s development body for the arts caused anger and dismay when it announced it was cutting completely the funding of a number of disability arts organisations, including the acclaimed Birds of Paradise Theatre Company. Subsequent concern has focused on decisions stripping other companies of long term funding too, particularly those involved in touring theatre, such as the award-winning Musselburgh-based Catherine Wheels, and music companies, including the Dunedin Consort and the Hebrides Ensemble.

Creative Scotland has been on the back foot ever since, with disability groups, TV stars and charity chiefs among those questioned why so many respected groups were being stripped of their Regularly Funded Organisation (RFO) status.

Now two board members have resigned their positions, Professor Maggie Kinloch, former deputy principal of the Royal Conservatoire of Scotland, and journalist and former Herald Columnist Ruth Wishart. Ms Wishart was clear she thought the decisions on RFOs had been “flawed”.

It is this dissent which makes the protestations of interim Creative Scotland chair Ben Thomson somewhat baffling if not completely disingenuous. He says the funding decisions were carefully reached, and signed off unanimously by the board.

The resignations make it clear that even if “signed off” unanimously, perhaps on the same principle as that of cabinet responsibility in government, they were not universally supported. “It’s not possible to go into the discussions at the relevant board meeting,” Ms Wishart says, but adds that she has had time to reflect on whether she could continue to back the decision.

Increasingly Creative Scotland looks like an organisation heading for its biggest crisis since its head Andrew Dixon was forced to step down from his role as chief executive in2012.

The frustration for all concerned is that these problems seem entirely of the quango’s own making. Despite fears of cuts to funding, the recent Scottish budget not only failed to bear out those threats– it saw the Scottish Government delivering an generous increase to the financial support on offer. There was no obvious need to impose cuts, and no clear defence for doing so.

Instead we are left with a strategic decision to remove funding from companies delivering art, music and theatre direct to the public and instead give it to intermediary bodies to carve up and hand on.

Instead of artistic endeavour, Creative Scotland appears to be investing in bureaucracy, which is rarely a route to popularity. Meanwhile no details have been released about how a £2m promised touring fund will actually work.

The way out of this mess for Creative Scotland is far from clear. They can ride out the storm and stick by their decision, in which case they need to explain it to the doubters – who appear to include Culture Secretary Fiona Hyslop. Or they can perform some kind of U-turn, although what this will be is not clear. They have already promised funding to 116 arts organisations and cannot easily retract their offer.

Either way the imminent board meeting looks crucial. When the remainder of the board meets it will have two tasks.

Self-evidently it needs to take charge and sort out a decision which has at the very least been a communications disaster. And it needs to ensure it can restore the trust of the the artists, orchestras, theatre companies and others who rely on Creative Scotland and who expect it to be on their side.