Memorandum submitted by the Reviewing
Committee on the Export of Works of Art and
Objects of Cultural Interest
This submission to the House of Commons Culture,
Media and Sport Committee has been prepared by the Chairman of
the Reviewing Committee on the Export of Works of Art and Objects
of Cultural Interest, Lord Inglewood, and was endorsed by the
Committee on 13 September 2006.
It updates and supersedes evidence previously
submitted in response to the Committee's Inquiry into the Heritage
Sector, by taking account of the outcome of cases resolved since
that time and reflecting other developments.
SUMMARY OF
MAIN POINTS
This paper sets out the Reviewing Committee's
concerns on the operation of the existing arrangements intended
to protect the national heritage by ensuring that objects of the
highest quality which have been found to be of national importance
do not, in general, get exported. We believe that there is substantial
evidence that these are not working as they should, above all
due to a lack of available funding.
The number and value of items of national importance
which have been granted export licences after a decision on the
licence was deferred to give public institutions or private individuals
in this country the opportunity to purchase them, has far exceeded
the number and value of items that have been retained in the United
Kingdom, as is shown in the tables attached to this paper. This
generally occurred because of a lack of serious expressions of
interest from UK purchasers. On average, over a 10 year period
from 1995-96 to 2004-05, export licences were granted (ie matching
offers were not forthcoming) for items worth 61% of the total
value of items that went under deferral at an average value of
17 million pounds a year (see Annex B). Even though a greater
proportion of items was purchased in 2005-06, the figures for
the 10 years from 1996-97 to 2005-06 are not substantially different.
Export licences were granted for items worth 58% of the value
of items that went under deferral for this period at an average
value of 15 million pounds a year.
The acquisition of cultural items by public
institutions is for the benefit of us all and for posterity. Such
acquisitions add to our national cultural and intellectual capital
and have as much capacity to inspire and educate as the finest
contemporary items. It is for this reason that we have no doubt
that public institutions should be given the resources to extend
their holdings and thereby improve their public displays, increase
their capacity to contribute to temporary exhibitions, and extend
research and understanding. In doing so they will significantly
enhance accessibility across the country, and enlarge our understanding
and appreciation of our cultural heritage and the world we live
in. We believe that the levels of taxpayers' money required to
enhance the ability of public institutions to achieve this will
cost almost nothing in the context of the total burden of taxation.
It will also represent a good and proper use of public money providing
a sound investment.
The rules under which the Heritage Lottery Fund
operates appear to have the effect, in some cases, of defeating
its ability to save objects of national importance. The National
Heritage Memorial Fund is potentially a better vehicle of last
resort, but does not have enough money for this purpose and has
many other claims on it.
Possible solutions to the problem of funding
the purchase of objects of national importance would be through
increasing the grant made to the National Heritage Fund (beyond
the £10 million planned for 2007-08) or through the establishment
of a National Acquisitions Fund. We have suggested both possibilities
to the Government.
We note that the Goodison Review recommended
a number of fiscal measures designed to encourage charitable giving
to help ensure that the finest cultural objects do not leave our
country. We are disappointed at the Treasury's failure to respond
to these to date.
We are not suggesting that all items of national
importance should always remain in this country, but the fact
that such a high proportion are not retained indicates a serious
problem and we look to the Government to take action.
HISTORY OF
EXPORT CONTROLS
IN THE
UK
1. The reasons for controlling the export
of what are now known as cultural goods were first recognised
in the UK at the end of the 19th and beginning of the 20th centuries.
Private collections in the United Kingdom had become the prey
of American and German collectors and institutions and it was
apparent that many were being depleted and important works of
art sold abroad at prices in excess of anything that UK public
collections or private buyers could afford. It was against this
background that the National Art Collections Fund was established
in 1903 to help UK national and provincial public collections
to acquire objects that they could not afford by themselves.
2. Until 1939, the United Kingdom had no
legal controls on the export of works of art, books, manuscripts
and other antiques. The outbreak of the Second World War made
it necessary to impose controls on exports generally in order
to conserve national resources. As part of the war effort, Parliament
enacted the Import, Export and Customs Powers (Defence) Act 1939,
and in addition the Defence (Finance) Regulations, which were
not intended to restrict exports but to ensure that, when goods
were exported outside the Sterling Area, they earned their proper
quota of foreign exchange. In 1940, antiques and works of art
were brought under this system of licensing.
3. It was in 1950 that the then Labour Chancellor
of the Exchequer, Sir Stafford Cripps, established a committee
under the Chairmanship of the First Viscount Waverley "to
consider and advise on the policy to be adopted by His Majesty's
Government in controlling the export of works of art, books, manuscripts,
armour and antiques and to recommend what arrangements should
be made for the practical operation of policy". The Committee
reported in 1952 to R.A. Butler, Chancellor in the subsequent
Conservative administration, and its conclusions still form the
basis of the arrangements in place today.
CURRENT EXPORT
CONTROLS
4. The export controls are derived from
both UK and EU legislation. The UK statutory powers are exercised
by the Secretary of State under the Export Control Act 2002. Under
the Act, the Secretary of State for Culture, Media and Sport has
made the Export of Objects of Cultural Interest (Control) Order
2003. Export Controls are also imposed by Council Regulation (EEC)
No 3911/92 as amended, on the export of cultural goods. The control
is enforced by HM Revenue and Customs on behalf of the Department
for Culture, Media and Sport (DCMS). If an item within the scope
of the legislation is exported without an appropriate licence,
the exporter and any other party concerned with the unlicensed
export of the object concerned may be subject to penalties, including
criminal prosecution, under the Customs and Excise Management
Act 1979.
THE REVIEWING
COMMITTEE ON
THE EXPORT
OF WORKS
OF ART
AND OBJECTS
OF CULTURAL
INTEREST
5. An independent Reviewing Committee on
the Export of Works of Art was first appointed in 1952 following
the recommendations of the Waverley Committee. It succeeded an
earlier Committee of the same name established in 1949, comprising
museum directors and officials, which heard appeals against refusals
and, from 1950, all cases where refusals were recommended. In
2005, the Committee's title was amended to Reviewing Committee
on the Export of Works of Art and Objects of Cultural Interest
and its terms of reference were revised, following the Recommendations
of the Quinquennial Review on the Reviewing Committee. The Committee's
terms of reference are:
(i) To advise on the principles which should
govern the control of export of objects of cultural interest under
the Export Control Act 2002 and on the operation of the export
control system generally;
(ii) To advise the Secretary of State on
all cases where refusal of an export licence for an object of
cultural interest is suggested on grounds of national importance;
(iii) To advise in cases where a special
Exchequer grant is needed towards the purchase of an object that
would otherwise be exported.
6. The Committee is a non-statutory independent
body whose role is to advise the Secretary of State for Culture,
Media and Sport whether a cultural object which is the subject
of an application for an export licence is of national importance
under the Waverley criteria (so named after Viscount Waverley),
which were spelt out in the conclusions of the Waverley Report.
The Committee consists of eight full members, appointed by the
Secretary of State for Culture, Media and Sport, seven of whom
have particular expertise in one or more relevant fields (paintings,
furniture, manuscripts etc), and a Chairman (biographies of the
Committee members can be found at Annex C).
THE WAVERLEY
CRITERIA
7. The Waverley criteria are applied to
each object the Committee considers:
— Waverley one. Is it so closely connected
with our history and national life that its departure would be
a misfortune?
— Waverley two. Is it of outstanding
aesthetic importance?
— Waverley three. Is it of outstanding
significance for the study of some particular branch of art, learning
or history?
These categories are not mutually exclusive
and an object can, depending on its character, meet one, two,
or three of the criteria.
8. The Committee reaches a decision on the
merits of any object which the relevant expert adviser draws to
its attention.
9. A hearing is held at which both the expert
adviser and the applicant submit a case and can question the other
party. The permanent Committee members are joined for each hearing
by independent assessors (usually three), who are acknowledged
experts in the field of the object under consideration. They temporarily
become full members of the Committee for the duration of consideration
of the item in question.
10. If the Committee concludes that an item
meets at least one of the Waverley criteria, its recommendation
is passed on to the Secretary of State. The Committee also passes
on an assessment of the item's qualities and a recommendation
as to the length of time for which the decision on the export
licence should be deferred, to provide UK institutions and private
individuals with a chance to raise the money to purchase the item
to enable it to remain in this country. It is the Secretary of
State who decides whether an export licence should be granted
or whether it should be deferred, pending the possible receipt
of a suitable matching offer from within the UK. Where an owner
turns down (or makes clear his/her intention to turn down) a matching
offer from a public institution or from a private individual who
has provided a signed undertaking to guarantee reasonable access
and satisfactory conservation and security arrangements, the Secretary
of State will normally refuse a licence.
11. Since the Committee was set up in 1952,
many important works of art and objects of cultural interest have
been retained in the UK as a result of its intervention.
THE RECENT
OPERATION OF
THE CONTROLS
ON THE
EXPORT OF
WORKS OF
ART AND
OBJECTS OF
CULTURAL INTEREST
IN THE
UNITED KINGDOM
12. The figures on the attached tables at
Annexes A and B analyse the outcome of the Reviewing Committee's
work since 1996-97.
ADEQUACY OF
AVAILABLE FUNDING
TO RETAIN
"WAVERLEY ITEMS"
IN THE
UNITED KINGDOM
13. The nature of the Waverley system is
that it is a tripwire, as opposed to a mandatory right of pre-emption.
If an item meets any of the Waverley criteria and is found to
be a national treasure, it generally follows that every effort
should be made to retain it because of the serious depletion to
our national heritage that its departure would represent. In view
of this, it is a matter of serious concern that there should be
a consistent failure to find the necessary funds to purchase "Waverley"
items.
14. By their very nature, such items are
of interest to an international as well as a national audience.
Their value is moving ever upwards, often ahead of inflation,
and ahead of the run-of-the-mill items of their type.
15. The number and value of items of national
importance which have been granted export licences after a decision
on the licence was deferred to give public institutions or private
individuals in this country the opportunity to purchase them,
has far exceeded the number and value of items that have been
retained in the United Kingdom, as is shown in the tables attached
to this paper. This generally occurred because of a lack of serious
expressions of interest from UK purchasers. In the 12 months covered
by our annual report for 2004-05, the Secretary of State deferred
decisions on items worth £46.4 million in order to give public
institutions and private individuals in this country the opportunity
to purchase them. The value of such items purchased was only £5.8
million (13% of £46.4 million) whereas the value of items
for which export licences were ultimately granted to date was
£30.2 million (65% of £46.4 million). In 2005-06 a greater
proportion of items has been purchased. The Secretary of State
deferred decisions on items worth £15.6 million. The value
of items purchased was £8.3 million (53% of £15.6 million)
whereas the value of items for which export licences were ultimately
granted to date was £7.3 million (47% of £15.6 million).
However, the balance for 2005-06 would be far worse were it not
for the philanthropy of Sir Peter Moores, who enabled Compton
Verney to purchase the two paintings by Canaletto for £6
million, with funds provided by the Peter Moores Charitable Trust.
16. Analysis of a particular year can give
a statistically distorting picture. Earlier in the year we noted
that on average, over a 10 year period from 1995-96 to 2004-05,
export licences were granted (ie matching offers were not forthcoming)
for items worth 61% of the total value of items that went under
deferral at an average value of 17 million pounds a year (see
Annex B). Even though a greater proportion of items was purchased
in 2005-06, the figures for the 10 years from 1996-97 to 2005-06
are not substantially different. Export licences were granted
for items worth 58% of the value of items that went under deferral
for this period at an average value of 15 million pounds a year.
17. The acquisition of cultural items by
public institutions is for the benefit of us all and for posterity.
Such acquisitions add to our national cultural and intellectual
capital and have as much capacity to inspire and educate as the
finest contemporary items. It is for this reason that we have
no doubt that public institutions should be given the resources
to extend their holdings and thereby improve their public displays,
increase their capacity to contribute to temporary exhibitions,
and extend research and understanding. In doing so they will significantly
enhance accessibility across the country, and enlarge our understanding
and appreciation of our cultural heritage and the world we live
in.
18. We believe that the levels of taxpayers'
money required to enhance the ability of public institutions to
achieve this will cost almost nothing in the context of the total
burden of taxation. It will also represent a good and proper use
of public money providing a sound investment. In addition we believe
that enabling the purchase of potential Waverley items before
there is an application for an export licence may well, in some
cases at least, significantly reduce the final purchase price.
If things remain as they are now, there is a real danger that
public collections will ossify and their ability to attract, motivate
and delight will be compromised.
19. Furthermore, if further changes in general
taxation are introduced which have the effect of increasing the
numbers of Waverley items coming onto the market, the increased
take from taxation provides an additional supply of revenue, some
of which could be used to enable UK institutions to acquire them
in line with government policy.
20. A failure to continue to develop our
world-famous national and local gallery and museum collections
through suitable acquisitions now threatens to destroy the stimulating
educational force which they have become. Such a decline is more
than a misfortune, it represents a general degradation of experience
for those living in and visiting the United Kingdom.
21. The Government has explained that the
Heritage Lottery Fund (HLF) is the principal source of money to
be used to acquire objects of cultural interest. However, the
Lottery, which has to address a wide range of heritage projects,
has rarely been used to fund the acquisition of major masterpieces
and the requirements it stipulates can frustrate an application
for support for the purchase of those items found to be national
treasures or "Waverley" items. We were concerned, and
indeed surprised, that in the Department for Culture, Media and
Sport's "Consultation on National Lottery money for arts
and film, sport, and heritage from 2009", to which we responded,
there was no express discussion of the part the Heritage Lottery
Fund might play in ensuring objects of the highest cultural significance
are not exported, nor of the role of Lottery funding in the acquisition
of such objects to ensure they remain in the United Kingdom.
22. We believe that if the Government intends
to continue to argue that HLF is a principal source of money for
the acquisition of objects of cultural interest, then its detailed
requirements should be reviewed seriously and imaginatively so
that such purchases, which are invariably time-limited, can proceed
efficiently and effectively. It can happen that HLF requirements,
however justifiable and relevant in other contexts, on balance
can prove counter-productive in the case of acquisitions as they
both discourage applicants and reduce the priority given by the
Fund, thereby running against the wider public good. If there
is not such a review, we believe that it is essential that additional
funding should be made available from elsewhere for such objects.
23. The Government, however, has made it
clear that because of the existence of the Lottery, it will not
provide Exchequer Grants to "save" objects in England
on a needs must basis even though the Scottish Executive takes
precisely the opposite view in similar circumstances. Working
on the assumption that the Government's approach to the Lottery
remains unchanged, we believe—and it is a view shared by
many others—that providing sufficient funding for the National
Heritage Memorial Fund offers a potentially better vehicle of
last resort. The advantage is that its application system can
deal more effectively with the specific business of the acquisition
of works of art and cultural interest. The disadvantage is that
the Fund appears not to have enough money to achieve this and
to respond to the many other claims it receives. Its total funds
available for 2004-05 and 2005-06 amounted to only 10.8% of the
total value of items placed under deferral in 2004-05 and 32%
of the total value of items placed under deferral in 2005-06.
In our view, therefore, the increase would need to go beyond the
£10 million planned for 2007-08 to stop the current depletion
of our national patrimony, which must we believe be carried forward
into future years at a level to enable the Fund to carry out the
purpose for which it was established.
24. Another possible solution would be to
establish a National Acquisition Fund, an approach advocated by
a number of influential commentators. This would enable potential
purchasers to be more pro-active. We are pleased that the Secretary
of State agreed to give further consideration to this in her response
to our annual report for 2004-05, but note with dismay that in
recent months Ministers from both HM Treasury and DCMS have stated
in response to Parliamentary Questions that there are no proposals
for a new Acquisition Fund.
25. We also note that the Goodison Review
(published January 2004) had a number of specific detailed proposals
which Sir Nicholas urged the Treasury to adopt in the public interest,
to help ensure that the finest cultural objects do not leave the
country. We deeply regret that the Treasury has still, at the
time of writing, made no response to the fiscal recommendations
put forward by Sir Nicholas.
26. In our view the present arrangements
are not working as effectively as is needed. We are not alone
in our concerns. The importance to museums of active collection
and the problems caused by a shortage of funds was forcefully
brought home in two pieces of research published in 2006. The
Collecting Challenge: The Art Fund Museum Survey 2006 revealed
that 70% of museums which had responded believed acquisitions
were vital for attracting visitors and 78% considered they were
important for educational purposes, but 96% considered inadequate
funding a barrier to collecting. A paper by Mark Jones, Director
of the V&A, explained why previous arguments that funds from
major bodies such as HLF, NHMF, The Art Fund and the V&A Purchase
Grant Fund were an effective substitute for the inadequacy of
museums' own acquisition funds are no longer valid. It also highlighted
a number of adverse consequences, including the effect on our
sense of self-respect and cohesion at national and regional levels,
the development of expertise in museums and the negative effect
on creative industries.
CONCLUSION
27. As part of our remit to advise on the
principles which should govern the control of export of objects
of cultural interest under the Export Control Act 2002 and on
the operation of the export control system generally, we are concerned
that too many objects which are the subject of licences on which
the Secretary of State has deferred a decision are, in fact, eventually
being exported because matching offers are not forthcoming. It
is not that we believe no object found to meet the Waverley criteria
should ever go abroad; rather it is that given the system in the
UK depends upon matching offers being forthcoming, a general failure
to secure such offers has become a systemic flaw in the arrangements
taken as a whole.
28. We do not consider it is part of our
remit to advance ideas in detail as to how this shortcoming might
be dealt with: that is for others whose responsibility it is.
Rather, we wish to point out emphatically that the existing arrangements,
excellent though they are in many ways, are not working as intended
because of a shortage of money.
29. This country has put in place a set
of arrangements to ensure objects of the highest quality do not,
in general, get exported. We believe that the policy behind these
arrangements is not being implemented properly if the quantity
of such objects currently being exported remains at its present
level, and to that extent it is not working.
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