Written evidence submitted by the National
Music Council (arts 153)
EXECUTIVE SUMMARY
1. The music sector is characterised by
its complex ecology and mixed economy with the result that any
cut in funding will have consequences stretching far beyond the
organisation directly affected by such cut.
2. Investment in the music sector represents
exceptional value for money for the economy and social well being
of the country as a whole.
3. Uncertainty and inconsistency in public
funding for music organisations will have a long term damaging
effect on the health of the sector and consequently on the country.
4. Private giving is an important source
of funding for music organisations but carries risks, meaning
it can never be relied upon too heavily.
WHO THE
NMC IS AND
REPRESENTS
5. The National Music Council is a representative
organisation with members drawn from the professional, voluntary
and amateur music sectors and both the subsidised and commercial
sectors. The NMC's members include representative organisations
for creators, performers in the live and recorded areas, promoters,
festivals, music libraries, education providers, broadcasters
and those providing advisory services and manufacturing and supplying
musical instruments. A full list of members is attached at Appendix
I.
6. The extent to which NMC members and their
own individual member organisations benefit from arts council
or local authority funding varies from member to member. But all
NMC members are essential participants in the delicate eco-system
that is the UK's vibrant music sector.
7. The NMC itself is a charitable organisation
and relies on modest subscriptions from its members and the voluntary
efforts of its officers and Executive Committee.
INTRODUCTION
8. This submission reflects the views of
the NMC membership as a whole. A number of members have filed
their own submissions to the CMS Select Committee in which they
address their own individual circumstances. The NMC supports its
members' individual positions insofar as they are consistent with
the position in this paper.
9. Many of the points made in this paper,
whilst specifically referring to music organisations, will have
broader application to the arts and arts organisations more generally.
RESPONSES TO
THE COMMITTEE'S
SPECIFIC QUESTIONS:
What impact recent, and future, spending cuts
from central and local Government will have on the arts and heritage
at a national and local level?
10. Any cut in direct public funding of
a music organisation, whether that funding is received in the
form of an arts council or local authority grant, will have a
far wider impact on the overall sustainability of that organisation
than the cut itself would suggest. Many music organisations, including
the regularly funded organisations (RFOs), rely only in part on
direct public funding but it is a crucial element of their income
without which they could not generate the other income which they
need in order to be able to function.
Consequences for non-Governmental funding:
11. It is often the very fact that an organisation
has won the confidence of central and/or local public funding
bodies, whether for its excellence or for its pioneering work,
that gives private funders the initial impetus and confidence
to invest in that organisation. If the level of public subsidy
goes down then the level of private funding may well be put at
risk.
12. Furthermore, in the current economic
climate where private sponsors, often corporations, are themselves
under immense financial pressures, many arts organisations will
look to Trusts and Foundations for even more support than they
currently give but this is a limited and finite resource.
Impact on the development of music:
13. The perceived threat that the RFOs with
a remit to represent more niche, more edgy and less obviously
popular work will be at the highest risk of having their funding
cut is of particular concern since it is often these organisations
that are driving the development of music and the expansion of
public taste.
14. The arts councils and local authorities
have provided crucial seed funding for much grass roots and developmental
work. This investment is critical to the growth of a dynamic,
music sector, both locally and nationally, and to the development
of both audiences and of future professional and amateur musicians.
15. The music available to audiences in
this country is currently rich in diversity, quality and quantity.
Cuts would undermine current provision and if artistic compromises
are made because of economic pressures the UK arts scene will
appear retrogressive in comparison to those of continental Europe,
Scandinavia and the USA.
Effect on ability to plan ahead:
16. Public funding can provide a music organisation
with the level of security that it needs to enable it to plan
ahead. Promoters, performers and all those involved in music productions
often have to plan some two to four years ahead in order to secure
the venue and artist(s) needed for a particular performance, particularly
where there is an international dimension to the performance and
the organisation is competing on the world stage. A perennial
concern of many music organisations has been that arts councils
have not committed to funding them on a sufficiently long-term
basis and therefore recent arts council policy to provide three
year funding agreements in certain cases has helped to improve
this situation for some.
17. Forward planning is also essential if
the organisation is to attract audiences for its work and satisfy
its core purpose of making its work accessible to the widest possible
audiences. Audiences also provide the vital third element of income
that a music organisation needs in order to sustain itself.
Consequences for interdependent organisations and
individuals:
18. In addition to the direct impact on
a single music organisation of any cut in public funding as outlined
above there is the overall impact that cuts will have on all the
organisations with which that single organisation works or upon
which it depends. A performance with music at its heart is reliant
on many more people and organisations than those visible to the
audience on the night. For example:
(a) It is the promoter's role to piece together
all the elements, including but not limited to the performers,
that may be required to realise a particular performance, a performance
that is often creatively conceived by the promoter in the first
place.
(b) The venue is essential in bringing together
performers and their audiences.
(c) Through the involvement of broadcasters the
performance can reach an even wider audience, both nationally
and internationally.
(d) The performers are employed because of their
skills acquired through years of training and education delivered
by experts in that sphere.
(e) They in turn rely on the creative contribution
of composers and writers and on music publications and instruments
that have to be manufactured.
19. These are just some examples of the
hidden complexity underlying what an audience may see on stage
and of the interdependence of music organisations and musicians.
Impact of possible cuts in music education:
20. NMC members are concerned that public
spending cuts in education could have a direct impact on the music
sector. Unless spending on music education is maintained at least
at current levels the potential of some of our most talented musicians
may never be realised. Music education is also important for the
development of the widest possible appreciation of music in all
its forms and therefore for the development of tomorrow's audiences.
Many music organisations are responsible for well-established
outreach programmes that support music provision in schools. Should
these programmes suffer as a result of funding cuts at the same
time as a reduction in the level of funding for music education
the combined impact would be very serious indeed.
The additional impact of the increase in VAT:
21. The impending increase in VAT will have
a direct impact on ticket prices for commercially promoted events
and therefore on the music sector. This will be the case whether
organisations decide to bear the extra cost themselves, which
they are unlikely to be able to afford to do, or to pass the increase,
wholly or partly, on to their audiences, which may result in their
selling fewer tickets and so reducing audiences.
Effect on the wider UK economy
22. The multiplier benefit, whereby for
every £ invested in the arts at least double the amount or
more, depending on which research and which area one looks at,
is generated for the benefit of the country's economy as a whole,
is a very significant factor which is special to the arts. The
UK's musical scene is currently a major attraction for visitors
to this country, so boosting tourism and all the valuable benefits
they bring to the UK economy. In addition there are many other
sectors that benefit from music and the other arts including the
restaurant business, transport and the many providers of goods
and services that support the arts. Music also is a valuable net
export for this country.
23. It goes almost without saying that another
impact of funding cuts will be a reduction in the number of people
employed in the sector with all the consequential losses in taxes
and attendant social costs associated with unemployment.
Impact on the cultural and beneficial value of music:
24. This country's investment in music and
the arts in recognition of their innate value is part of what
make us a civilised society. Music and the arts also make an important
contribution to community integration and social cohesion and
wellbeing. Music and the arts enrich lives and their benefits
go far beyond their economic impact, but they need nurturing if
they are to thrive for the benefit of our society.
25. The power of music to affect the well
being of our society, particularly when the country is facing
difficult challenges as it is with the global recession, is well
documented. If anything this is the very time to invest more,
not less, in the arts. Indeed the Arts Council can trace its beginnings
to John Maynard Keynes' recognition of the valuable wartime work
of its predecessor, the Committee for the Encouragement of Music
and the Arts (CEMA), when the nation's "spirits were at a
low ebb".
Summary:
26. The overall impact on music and the
arts of public spending cuts will be increased instability in
an already fragile mixed economy far out of proportion to the
actual level of cuts. Many organisations will have to reduce their
activities and others will cease to exist if they cannot find
one or more alternative funding sources. This will in turn have
an impact on the entire sector. The current scenario has the characteristics
of a perfect storm for many music and arts organisations.
What arts organisations can do to work more closely
together in order to reduce duplication of effort and to make
economies of scale:
Existing partnering:
28. Many music organisations already partner
with other music and arts organisations on an occasional or regular
basis in order to maximize the different skills, capabilities
or investment that each can bring to bear in a particular situation
or to a particular creative project.
Premises and other common overheads:
29. Premises represent a very significant
element of many arts organisations' costs and there may be scope
for some degree of rationalisation in this area. Public investment
in premises to house multiple arts organisations in various centres
across the country could be a pragmatic and cost effective solution.
In addition, the very fact of arts organisations working in close
proximity to each other will enable them to find economies of
scale in their operational costs that would not otherwise be possible.
Furthermore such proximity could be beneficial from a cultural
and creative point of view and result in some innovative work
inspired by partnerships that organisations may not otherwise
have contemplated.
30. The valuable outreach work that many
organisations currently undertake, and which for some is a condition
of their public subsidy, could be organised centrally from such
premises and this could result in an increase in provision and
improved equality of access to such work across the country. Examples
of successful cultural hubs to date include the Sage Gateshead
and Somerset House in London.
Mergers:
31. There are examples of music organisations
that have already fully merged with the encouragement of arts
councils. Sound and Music is a very recent case in point, bringing
together four well established but small organisations involved
in different ways with contemporary music. Whilst the experience
of Sound and Music is that mergers can succeed they are nevertheless
very high risk and a successful outcome is not always achieved.
Furthermore, there is a significant cost in effecting a merger
and, in the short-term at least, a successful merger outcome may
be reliant on an increase in funding. Whilst the newly merged
organisation is likely to be better placed to undertake more activity
than the pre-merger founder organisations, and whilst there will
be economies of scale, mergers are unlikely to result in significant
overall savings.
Summary:
32. Whilst economies of scale should be
sought, care must be taken to ensure that these are not secured
at the expense of diversity and breadth in programming, commissioning
and production.
What level of public subsidy for the arts and
heritage is necessary and sustainable?
33. The answer to this question requires
a detailed cost/benefit analysis to be conducted which takes into
account the full economic and social impact of investment in the
arts going beyond the immediate returns to the arts organisations
themselves. Please see the response to Q 1 above.
34. There is a considerable disparity between
the current levels of public spending on the arts across the nations,
both on the basis of per capita spend and as a percentage of total
government spending, with Scotland investing the most and England
at the lower end of the scale. It is suggested that, at the very
least, public spending in England should be increased to match
that in Scotland (0.49% of government spending). As a point of
interest even this is well below the level of investment of many
of our European neighbours. Whilst the NMC does not advocate parity
with other European countries, the right balance must be struck
between leanness and agility on the one hand and sustainability
on the other.
Whether the current system, and structure, of
funding distribution is the right one:
35. On balance the NMC supports the principle
of an arm's length body being in place to allocate public monies
to arts organsations. However, music organisations have experienced
considerable challenges securing funding in the recent and not
so recent past due to the continual changes in structures and
criteria applied by arts councils and local authorities. Music
organisations have to spend considerable time and resources applying
for public funds, time and resource that could be spent on developing
and showcasing the art form.
36. And, as mentioned above, funding has
not always been granted on a sufficiently long-term basis, ie
at least three to five years, to enable organisations to plan
ahead effectively. This has resulted in an overall feeling of
insecurity that has been damaging to the health of the sector.
What impact will recent changes to the distribution
of National Lottery funds have on arts and heritage organisations?
37. The proposed changes are welcomed provided
any increase in National Lottery funding for music organisations
is additional to and not a substitute for central and local government
spending on the arts in accordance with the original policy when
the National Lottery was launched.
Whether the policy guidelines for National Lottery
funding need to be reviewed:
38. Please see our response to the above
question. Furthermore, if arts council funding is to be cut then
the restrictions currently imposed on RFOs applying for National
Lottery funding should be relaxed.
The impact of recent changes to DCMS arm's-length
bodies—in particular the abolition of the UK Film Council
and the Museums, Libraries and Archives Council:
39. The impact on the music sector of the
abolition of the UK Film Council is indirect but nevertheless
very important. The film industry draws on the specialist skills
of individuals and organisations working in a number of different
areas of the music sector, most notably composers, performers
and producers.
40. The UK Film Council has not only championed
British film and TV production but it has secured tax and regulatory
advantages which make the UK an attractive place for all aspects
of film production. In particular, London now enjoys a special
worldwide reputation for film and TV post-production services
which in turn generate valuable income for the British economy.
NMC members are keen to be reassured that this reputation and
its foundations will not be jeopardized by the abolition of the
UK Film Council.
41. Furthermore the use of a peer specialist
review system to determine the most culturally appropriate allocation
of public funds is tried, tested and workable. Funding decisions
for film need to be properly informed and consequently there needs
to be an equivalent arm's length organisation to carry out this
function on behalf of Government. Without such a body the landscape
for British film making and all the sectors upon which it relies
will not only change but there is a danger that it will be eroded
to the detriment of this country's economy.
42. NMC members would resist any future
move there may be away from the use of peer review systems to
determine the allocation of public funding for and within the
music sector.
Whether businesses and philanthropists can play
a long-term role in funding arts at a national and local level:
43. Businesses and philanthropists already
play an important part, alongside the many private Trusts and
Foundations, in funding music organisations and it is hoped that
they will continue to do so. The feedback from businesses and
philanthropists is that they like to be associated with funding
success rather than to be plugging funding gaps left by others.
Economic risk:
44. Naturally their ability to fund is subject
to fluctuation according to the economic climate. The much hailed
American system of endowments and private giving has recently
caused enormous problems for orchestras and other arts organisations
due to the fact that giving has fallen dramatically as a result
of the recession.
Reputational risk:
45. Furthermore, businesses have their own
expectations and needs which must be satisfied if they are to
sponsor an organisation or a particular project. The experience
of NMC members is that a sponsor requires considerable servicing
and that this is a resource intensive activity in itself. Furthermore,
should a problem occur within the sponsoring business this can
have an adverse impact on the sponsored organisation (as demonstrated
by the recent anti BP demonstrations held outside Tate Britain).
There can also be problems when it comes to individual donors
(the Royal Opera House was forced to rename its atrium The Floral
Hall in order to distance itself from philanthropist Alberto Vilar
who failed to make the anticipated donation and was subsequently
convicted of fraud).
Risk to artistic independence:
46. Over reliance on business or private
funding has the potential to compromise the integrity and independence
of artistic programming. Business sponsors and individuals are
keen to protect their reputations and so are understandably most
often risk and controversy averse. And yet experimentation and
risk taking are integral to the development of all art forms.
Summary:
47. Private sponsorship is therefore not
necessarily a reliable or long-term source of funding, being difficult
to secure and sometimes high risk. Over reliance on this source
would make it difficult for music organisations to plan ahead
and realise their artistic and strategic vision. It is in any
event more suited to high profile events than as a source of funding
for grassroots creativity.
Whether there need to be more Government incentives
to encourage private donations:
48. Private donations could be encouraged
through double Gift Aid, Payroll giving schemes and a clear system
of tax incentives. But all of these are merely alternative forms
of public subsidy carrying with them their own complexity and
associated administrative costs.
September 2010
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