Funding of the arts and heritage

Written evidence submitted by Andrew Welch (arts 31)

1. Introduction

This submission concentrates on the following:

· The Arts Council: whether it is presently constituted appropriately to fund the arts;

· The subsidised regional theatre;

· The role of philanthropy and its potential;

2. Summary of conclusions:

a. The Arts Council has moved away significantly from first principles. It now encompasses not just the professional artists and audiences for these arts but amateur arts, education, disability, diversity, equality and arts enabling organisations.

In expanding its scope I believe that ACE has lost sight of its primary purpose. The 2009 Annual Report trumpets ACE "achievements". This puts the cart before the horse: the achievements that should be trumpeted are those of the artists in receipt of funding. The ACE should be enabling not leading. I believe that this has lead to it being at best asleep on its watch when it comes to the core arts and the regions. For example, the decline in regional theatre audiences and the decline in ACE touring returns during a time when West End audiences increased year on year.

b. The incorporation of the additional areas of activity has meant that ACE’s decisions on its core business are now informed by the policies that the new areas brought with them. It has taken on a mantle that incorporates education and social services which would make the support and encouragement of artists and their audiences be seen through a series of lenses, not unlike varifocals. As a user of varifocals, I can tell you that they induce stumbling. And this is what ACE seems to have been doing.

c. ACE should be relieved of the functions it has acquired subsequent to 1994 ( when it became "a development agency for the arts") and fund only professional arts, artists and artist led companies and concentrate on doing this well;

d. The legitimacy of its policy making is questionable; indeed, should the body funding the arts be making policy for the arts in anything but the widest of terms?

e. The combination of policymaking and the awarding of funds by the only significant arts funding body in the country skews the market, inhibits arts organisations and artists (would organisations bite the hand that feeds them? I know of one chairman of a major arts company who said to me that he would have to accept the ACE preferred candidate for a job because they were the paymasters) and provides the basis for the suspicion that ACE is looking to ensure that politically correct arts are presented across the nation. The ACE should no longer be making "arts policy";

f. While ACE has significant resources spread across the country, there is a suspicion that a metropolitan view of what should be provided prevails; certainly the metropolis consumes far greater resources per head than elsewhere;

g. Comparison with the not-for-profit theatre sector in North America reveals a healthier, wealthier, much more popular activity than in the comparable theatres in the UK. Better attendance, more activity and more local support are hallmarks of the US experience compared to the UK. This should make us look at our funding structures and thus ACE again. It should also lead arts organisations to explore to what extent they have a responsibility to their audiences

h. ACE decision making structures need to be looked at so as to ensure that justice is done and seen to be done. More artists need to be involved in ACE decision making.

i. ACE funding agreements and policies disempower arts organisations in ways that are not apparent in the US where donors appear not to try to influence the arts organisations which they support. Perhaps there is a more sophisticated view of the arts there than we in the UK have hitherto supposed.

j. ACE needs to pay attention to the state of regional theatre and give thought to how to encourage this once healthy sector of the theatre business to flourish as it does in North America;

k. Philanthropy can play a much larger role in the arts than hitherto. Better incentives will play a role as will educating the arts organisations to see it as a strength, not a weakness (see the note from the Artistic Director of the Guthrie Theater in Minneapolis which is a footnote to this submission). ACE can play a significant role in helping this to happen.

3. The Arts Council: some thoughts on the Arts Council, the role it has created for itself in the arts, why this may be inappropriate and how it might evolve.

a. The original Maynard Keynes inspired charter of 1946 was replaced in 1994 and the new charter includes the phrase "the national development agency for the arts". This changed the ACE’s relationship to the arts and its clients. It moved from being a quango which acted as advocate, funder and facilitator of the professional arts to one that had an active role in determining policy for the arts in a much wider context. As it also is responsible for distributing funds to arts organisations, this put it into a position of considerable influence over what arts organisations actually did. This changed the ACE role from being politically neutral to being potentially overtly political and to an organisation that could and does rig the market.

b. It begs the question whether it is appropriate for the ACE to be making policy about the arts when it has no democratic brief to do so. It appears that the DCMS do not attempt to drive ACE policy, at least through the targets which are set. Whether it influences or drives arts policy less formally is not clear. The ACE appears to have no mechanisms which enable it to take regular, frequent and authoritative soundings of what audiences and artists are interested in. It was interesting to see from the recent Theatre Review that artists are unhappy with consultation with the ACE because this would appear to be mainly with producers rather than artists*.

c. Furthermore, it is clear from the 2009 ACE Annual Report that ACE has taken upon itself various social as well as artistic policies which it wishes to see inform the arts that it funds: diversity, equality etc, not just in achieving statutory requirements but actively pursuing these, perhaps at the financial expense of artistic achievement. Perhaps this is at the behest of the DCMS. In any case, it does raise the suspicion that the funding policies of the ACE are driven by a wish to achieve goals which are not necessarily foremost in the minds of artists and audiences, however well meaning the goals might appear to be.

d. The extension of ACE’s brief has

d. Arts Council Decision Making

1. It is disconcerting for senior staff and non-executive board members in arts organisations to find that the ACE staff is deficient in experienced arts managers and seems to have little real contact with artists. This leads to a suspicion that ACE staff do not understand sufficiently well the processes of running arts businesses, nor what is involved in the creation of art. It is not a question of the arts being rocket science but knowledge of how the businesses work and who plays active roles in making them work is important.

2. There is, of course, a wealth of expertise available to the ACE in the professionals working in the various fields that ACE funds. Actors, visual artists, musicians, theatre managers, gallery directors etc abound. The ACE formerly used specialist panels to consider grant applications. These panels comprised artists and managers who were serviced by ACE departmental staff. All the panellists gave their services. The panels have included actors such as Judi Dench and Timothy West. These panellists provided an expertise for the ACE far beyond the knowledge and experience of the ACE staff. They provided a link to the arts world for ACE staff which was positive. The panellists also attended productions, exhibitions etc and reported on these to the ACE so that the ACE had reports on the work that was being funded or was applying to be funded. The panellists did this for no fee but expenses only, i.e. cost of tickets/ entrance fee + transport. The ACE has recently re-introduced this use of arts professionals to report on arts events. However, it is contracting 300 such people at an annual fee of £1,000 each and will refund expenses incurred. The £300,000 this will cost each year would fund a small theatre company. This is ridiculous when the professionals involved would almost certainly be prepared to give their services, as used to be the case.

3. The abandonment of art form panels in favour of officer made decisions on grants contributed to an atmosphere of suspicion of the way grants were made. Panels may have had disadvantages but the advantages are palpable.

e. Arts Council staffing

1. The ACE staff is comparatively well rewarded financially; employment terms are generous for the arts sector. Comparisons with arts organisations funded by ACE confirm this. Very few arts organisations have been able to offer pension schemes to which the employer contributes, let alone as handsomely as the ACE does. While the ACE should perhaps set an example as a good employer, it is important the ACE remembers the reality of what happens in most arts organisations, many of which exist on a financial knife edge. Rather as the public sector has overtaken the private sector in pay, terms and conditions, so the ACE has done with the community which it exists to serve. It should also be remembered that arts companies can be volatile commercially speaking and, while subsidised, take risks, so employees of these companies are at risk of losing their jobs should, e.g. their company be forced to close. This is not true of the ACE. And, of course, there are very few performing or visual artists who have the security of a permanent contract and while this is their choice, there needs to be sensitivity shown about this, particularly by the funding body.

2. The 35 hour weeks advertised for ACE middle management posts must seem odd to those actually working in the arts where 6 day weeks are commonplace and unsocial hours are part of what constitutes the work. It must also inhibit the working practices of ACE officers. For example, it must make officer attendance at board meetings of arts companies difficult as these almost always take place in the evenings or at weekends because boards comprise non-executives who work for a living themselves during normal working hours. Does the Arts Council pay officers overtime to attend these, or do they just not go?

3. It is more than unfortunate that the chairmen of the ACE and its regional boards are remunerated but are at no personal risk. The chairmen of the arts companies which the ACE subsidises are not paid are at personal risk but would think it inappropriate that they should be paid when the artists whom they employ receive such poor rewards financially. All give their time to enable artists to create and communities to enjoy the arts. This inappropriate payment of ACE chairmen seems to symbolise the insensitivity that now characterises the relationship of the funding body towards the artists and organisations which it was set up to serve.

4. The Subsidised Theatre

a. The last 15 years have seen a decline in the number of what were called regional repertory theatres and a decline in the number of weeks of productions created by those theatres. In the last 4 years the repertory theatres in Exeter, Basingstoke and Derby have ceased operating as repertory theatres.

b. There has been a significant decline in the number of production weeks mounted by these repertory theatres during the last 20 years. My observation is that whereas 20 years ago these theatres were playing up to 48 weeks of their own work, now it is more likely that they will play about 30 weeks, filling some of the resulting dark weeks with touring shows and co-productions;

c. There has been a decline in the number of people attending productions in the subsidised regional theatres: see ACE’s Theatre Review, 2009. During the same period, the audiences in the West End rose year on year.

d. There has been a substantial increase in funding for these theatres in the years 2000-2006 and the number of people employed by these theatres has risen by 60% during this time. However, this increase in funding has been mirrored by a decrease in the ratio of earned to unearned income from 53% to 49% over the same period. This is in sharp contrast to what is happening in the US where the not for profits are, largely speaking, in rude health, attracting significantly larger audiences than here.

e. There appears to be a failure to understand the importance of these theatres to the development of a body of excellent actors in this country. We have some of the finest conservatoires in the world, RADA, GSMD and LAMDA spring to mind, which prepare very fine young actors. It is to the despair of those who run actor training that the opportunities for young actors to practise their craft are diminishing all the time with the decline of the repertory theatres. This failure with actors must be mirrored with designers, directors and the other creative staff involved in theatre production. Sadly, the Theatre Review did not touch on the training of young artists and no evidence appears to have been taken from those doing this job.

f. A personal experience has been that the ACE middle management responsible for liaising with theatres and producing companies did not understand how they operate. This was compounded by ACE’s apparent failure to use the unique opportunity of working with these companies to train their staff to understand the dynamics and the business of companies including working with non-executive boards. There is a suspicion that the institution of what is called the "light touch" regime in effect means, inter alia, the ACE staff do not get to learn how the funded companies operate.

g. There is a problem with ACE subsidised touring: theatre companies’ earned income was down from 38% of overall income to 32% in the six year period of the Theatre Review. This indicates that what is being toured is not what the audience wants to see, as with the repertory theatres. The Theatre Review acknowledges there is a problem with touring. I fear that a failure to understand the nature and business of touring lies at the heart of this difficulty.

h. I have a real concern that what the audience is being offered is not a reflection of British theatre and that repertoires are not programmed in such a way as to enable local audiences to enjoy a well balanced diet of theatre. So audiences in the regions may well not have the opportunity to see, say, Shakespeare, Wilde, Sheridan, Goldsmith or Shaw with any degree of frequency or regularity. This is more than just deprivation for local audiences: it is denying them and, particularly young people, the opportunity to experience their national heritage of truly great theatre which, sadly, is less available in the UK regions than in North America. A factor may be the cost of such productions but ACE has many policy imperatives to encourage new writing, writing for diverse audiences, work that reflects the continental European traditions of a more visual theatre etc and, in a system where the policymaker also distributes funding, this can be a powerful imperative to toe the policy line. If this is so, then British audiences are being short changed by the Arts Council. Interestingly, in the US the major regional houses appear to have much better balanced repertoires, e.g. the programme of the Guthrie at Minneapolis, c.f., and my hunch is that attendances there are much higher than in the regional theatres here, e.g. the Guthrie plays to over 80% of capacity.

i. Underlying all this is a sense that the Arts Council is promoting an arts agenda which it has generated within itself and that it uses public funds to forward. It is difficult to discover where the roots of its policies lie other than to surmise that these are drawn from its own officers. The creation of policy which can have such far reaching effects, can go badly wrong and absorb considerable amounts of public funds is worrying. This is especially the case when it would appear that the ACE is not answerable in any meaningful way to anyone.

j. My observation of regional theatres in the major US cities is that they are better resourced, better attended, more at the heart of their communities than their counterparts here. I believe that the US funding system has much to do with this. The support by individuals and corporations but mainly by individuals binds tha theatres to their communities in a very positive way. The donors have a real interest and pride in their theatres and become, of course, good advocates of the theatres. This is why, despite the recent financial turmoil, no major regional theatre has closed in the US in the last three years with the exception of the Pasadena Playhouse which was already a financial basket case. This is a sad contrast to our own situation, see 2a above.

5. Whether businesses and philanthropists can play a long-term role at funding arts at national and local level.

1. The answer must be yes as this has happened with many arts organisations that are currently in existence, eg Glyndebourne, Garsington Opera, Chichester Festival Theatre, National Theatre and RSC. But there are also companies in the contemporary field which have encouraged significant donors, Art Angel. However, it has to be accepted that all these are companies which present prestigious work

2. At this point the numbers involved are still small both in terms of people involved and donations. And, most of the companies benefiting are very much metropolitan companies, drawing on the wealth of London.

3. Increasing numbers of donors:

1. Enable more people to become wealthy, to feel they have the funds to donate;

2. Make giving more attractive in tax deductibility and make it as easy as in the US.

3. Incentivise the arts companies: reward them financially for pulling in donors to their endowment funds – this will encourage people to give;

4. explore the idea of encouraging regional donors: perhaps there should be additional incentives for local donations to local arts companies; NB it is interesting to compare Birmingham Rep, serving England’s second city and Chichester Festival Theatre: the Rep attracts almost no personal philanthropy whereas Chichester attracts some £500,000. It would worth exploring why this is the case;

5. encourage arts organisations to identify themselves with their locales;

6. the more donors the companies get, the better they will do because the donors themselves become that company’s best advocates;

7. incentivise the arts companies to employ more development staff: fund these posts and reward success to a limited point – seedcorn funding – to enable them to get up and away;

4. ACE can play a significant role in helping arts organisations to prepare for this change through educating and incentivising their clients.


The following is from an email from Joe Dowling, Artistic Director of the Tyrone Guthrie Theater in Minneapolis. Joe Dowling is Irish and was previously Artistic Director of the Abbey Theatre, Dublin, so he knows the European funding model well:

"I am torn between my long-standing liberal belief that funding for the arts should be a government function and recognising that what I have discovered here is almost certainly better than centralized control that leads to the politically correct excesses you mention. The balance between federal funding, state support, foundation endowment funds, corporate support and individual philanthropy means that you have to work very hard each year to ensure that each of these stakeholders are satisfied with the work and will continue to fund the organization. We have a Development Department with about 20 full time employees working tirelessly to ensure that we can get to our goal. Incidentally, this year our goal is $7million in contributions from all these sources. We also have an endowment, which fluctuates with the stock market but it funds about a third of our needs. It is currently at about $40million and we draw 5% interest on that each year. The rest comes from box office.

In the fifteen years since I came here, I have never had the slightest interference in the programming from donors or corporations– and believe me – we have had some controversial and edgy work. American philanthropists are, in the main, more interested in supporting an art form with passion and allow the management to make the artistic decisions."

He goes on to say, a propos the possible change in funding mix of which you talked back in January at the RSA/ ACE conference:

"However, the change in culture from State funding to a mixture of government grants and private funding will take some considerable time. The culture cannot be changed overnight and as with most things, there may be a steep learning curve, during which time the government will have to be very clear about the tax advantages in philanthropy. This is an essential spur to giving and it is unlikely that the system here would work without it. "

September 2010