A YEAR AGO, Kim Carpenter's Theatre of Image stood on shaky financial ground. Macquarie University had abandoned its funding of the company, whose productions are aimed at children and their families.

And a private benefactor's three-year support amounting to $50,000 a year also came to an end. Carpenter thought it was curtains for his 20-year-old company.

But yesterday, Theatre of Image announced a new three-year funding partnership with the NSW Department of Education. The department's commitment of $300,000 will supplement the $200,000 the company receives annually from the Australia Council and Arts NSW combined.

Macquarie University's $40,000-a-year funding "disappeared when [Steven] Schwartz took over as vice-chancellor," Carpenter said. "Both Macquarie Trio [also funded by the university] and Theatre of Image were not required". Professor Schwartz's predecessor, Professor Di Yerbury, was also the chairwoman of Theatre of Image.

Vanessa Tay, a Sydney businesswoman, was appointed the chairwoman of the company last July. Tay, along with the company's ambassador, Hugo Weaving, will host a fundraising dinner next month, with a target of $150,000.

Carpenter said yesterday he approached the NSW Minister for Education, John Della Bosca, for the funding and "we got a very good hearing".

The company's 2008 season will begin in April with a show called Pixel & Friends, featuring Kristina Chan, who danced in Tanja Liedtke's Construct during last month's Sydney Festival.