Funding of the arts and heritage

Written evidence submitted by the Museums, Libraries and Archives Council (MLA)  (arts 98)

Introduction

1. MLA welcomes the opportunity to fe ed into the Committee’s inquiry. Our submission highlights in main our concerns and aspirations for the future funding of museums, libraries and archives.

2. On the 26 July the Secretary of State for Culture Media and Sport the Rt Hon Jeremy Hunt announced as part of the Government’s Arms Length Review that the MLA would be abolished to focus efforts on front-line services, with selected functions transferred to other organisations. We are working with DCMS and other bodies on the details and timescales for these changes and look to the outcome of the Spending Review in October . In the meantime the MLA is committed to being a source of robust advocacy for museums, libraries and archives and for the people and places that depend upon them, and for assisting a smooth transition to the best new arrangements achievable.

3. It is the firm intention of the MLA Board to communicate the advantages of a coherent and integrated approach to the leadership of museums, libraries and archives , and their join-up with other cultural and learning services . We believe that these principles need to be well understood and reflected in the shape of new delivery arrangements post-MLA. We judge that i t is important that e xpert advice, knowledge and research designed to support the development of high quality services for local people are not lost. We urge that the new arrangements must preserve the advantages of a coherent and integrated approach to the development and improvement of the sector within a wider cultural framework, and in the task of safeguarding and making accessible the nation’s most important collections nationwide.

About the MLA

4. The MLA is the government’s agency for museums, libraries and archives. Leading strategically, MLA promotes best practice in museums, libraries and archives to inspire innovative, integrated and sustainable services for all.  In the period 2007-10 the MLA transformed itself from an agency with ten separate charities and ninety trustees, to a single entity with a governance board of just ten. In the process, MLA increased its operational efficiency and realised substantial revenue savings.

5. We now work as an agency which targets its resources to where they will be most effective in order to support transformation in the sector. Working across government, and with 150 local authorities, 3000 public libraries, 300 archi ves and 1200 museums, we support targeted services for communities and the people that live in them and work on national initiatives that can’t be delivered by local councils working on their own . We have funding relationships with more than 80 bodies of varying sizes, and collaborate with other Non Departmental Public Bodies (NDPBs), and various sector and public bodies nationally and regionally .

6. MLA, through its engagement with local councils, has special knowledge of each of their circumstances in relation to libraries and cultural services. Our small but agile field team (26 home workers across the country), has enabled us to deliver some notable initiatives in support of sector transformation. Our work is underpinned by four strategic priorities: continuous improvement; learning and skills; sustainable communities and effective leadership and strong advocacy.

Future funding of museums, libraries and archives

7. Local government funding - Our main concern in relation to future funding is the position of local government. The majority of spend on museums, libraries and archives is directly in the control of councils. We believe there is a need for a place- based spending philosophy – a locally determined and joined up approach to investment which gives local partners the flexibility to move money to where it can be effectively spent locally.   We have worked closely with Arts Council England and other NDPBs to encourage a joined-up approach among government agencies in the English regions.

8. However, while MLA strongly supports the principle of localism, that decisions should be made as closely as possible to the users, we do not believe that local government should be left un-supported with sole responsibility for museums, libraries and archives. Outside of the un-defined duty to provide a "comprehensive and efficient" library service, their spend is largely discretionary and therefore especially vulnerable given all councils are making cuts, and are also concerned about the outcome of the Spending Review and subsequent local government funding settlement. A key challenge is to manage the relationship and respective responsibilities between central and local government. It is vital that local government is supported; with expert advice and guidance, and to form partnerships beyond their boundaries. There must be a mechanism, incentive and duty on councils to consider the wider geographical and national interest in safeguarding collections.

9. Sharper investment - MLA believes that the size of the funding pot is only part of the issue – we need mechanisms and the leadership to ensure that money is well spent, duplication is avoided, best practice spread, opportunities for levering in funding and promoting philanthropy maximised, and the national interest protected. We believe it vital that overheads within local councils are brought down to the lowest possible level, over and above savings that can be achieved by cross-boundary collaboration and sharing of services. Investment must be focused on the front line, and services modelled around the needs of the consumers.

10. Many initiatives can only be conceived of, led and cost-effectively delivered nationally, whether that is through an MLA or alternative arrangement. MLA has delivered a number of such initiatives, such as the People’s Network, Reference Online and faster broadband for libraries. A list of key current national functions that will need maintenance is in Paragraph 17 below.

11. Future of Renaissance - The MLA curr ently administers Renaissance - the £50m per annum programme which delivers funding to regional museums ensuring government can effectively influence the direction and delivery of non-national museum services across the country. Our concern is to advocate that the benefits of the Renaissance programme - substantial increase in visitor numbers, educational attainment, community involvement, safeguarding and making collections accessible – must not be lost, either in the Spending Review outcome or in new arrangements put in place to deliver it post-MLA.

12. With an ambition to create "national-quality museums" across England, and in recognition of the need to deliver more for less, MLA has proposed to the Culture Minister, revisions to the Renaissance programme. We want to see a Future Renaissance programme that moves away from a model based on the granting of cash sums to the nine regional Hubs, and more based on a model that better targets the available funding to achieve world class museums nationwide in a way that achieves sustainable improvement. We have also suggested ways to improve the coordination of grant funding (including HLF and ACE) and to extend the reach of the programme to include public record offices where appropriate.

13. We believe it is also important that the partnerships and functions Renaissance supports across the country – such as the Museum Development network, are maintained in an integrated model. We also believe that the work of the Leading Museums initiative (launched by MLA in light of the Renaissance Review in 2009 and chaired by Professor Tom Schuller) needs to be taken into account.

14. Spend on museums also needs to take specific account of funding for university museums. While most Renaissance funded museums are part of our local government partnership, there is currently a direct funding relationship with the government and key university museums.

15. Libraries - with funding cuts compounded by pressure for council tax freezes, local authorities will have to take increasingly hard spending choices. There is an underlying danger, particularly in the absence of MLA or any equivalent national voice, that libraries (and museums and archives for that matter) will get squeezed into a no-mans land between funding for, say theatres, concerts, artists on the one hand, and local government core services on the other. Services should be designed around the demand evidenced by research and aimed to meet the needs of the public, rather than based on organisational boundaries if mass library closures are to be avoided.

16. As an answer to the financial challenge faced by libraries, and with the ambition to aim for modernisation and resist short-term closures and cuts, MLA, in partnership with the LGA Group, is leading the delivery of the Future Libraries Programme which will test drive new partnerships and governance models. The Minister for Culture Ed Vaizey announced on 16 August ten projects, representing 36 authorities that will deliver this ambitious change programme in the first instance with the aim of spreading best practice more widely. The programme is currently at an early stage of its work.

17. Archives - with the archive sector being smaller and having to compete for reduced funding with higher profile sectors within arts and heritage, it will be important that the voice of the archive sector, which has benefitted from cross sector advocacy embodied in the MLA, is not drowned out in a new framework of integration with the wider arts and heritage sectors. MLA and TNA jointly developed the government’s strategy and Action Plan for Archives, which advocates better more joined-up and accessible archive services, a concept which should be taken forward in the new arrangements. (See also Renaissance, above)

Lines of inquiry

Role of MLA

· The impact of recent changes to DCMS arm’s-length bodies - in particular the

abolition of the UK Film Council and the MLA

18. This is a time for significant challenge for our sector. An economy only slowly emerging from recession and pressures on public spending provide the spur to make even greater efforts to deliver social, economic and environmental benefits for people and communities. Reflecting the times the team at the MLA have worked tirelessly and with commendable commitment to use newly focussed resources and expertise to support every locality throughout England, whilst continuing to reduce operating costs. We are proud of the range and quality of services we have overseen and are committed to these being reflected in the new arrangements.

19. The MLA admi nisters key national functions (and services a number of arms-length expert technical panels which are vital to the task) including:

· M anaging Renaissance - the £50m a year programme which delivers funding to regional museums ensuring government can effectively influence the direction and delivery of non-national museum services across the country.

· Accrediting and developing museums to national standards

· Designating vital collections in non-national institutions

· export licensing and providing an expert service to the arms-length Reviewing Committee (which recommends export bars on objects of national significance)

· AIL (Acceptance of iconic objects in lieu of inheritance tax) and its arm-length panel

· Government Indemnity and national security – essential in enabling touring exhibitions

· funding the Portable Antiquities Scheme and many smaller, but far reaching and highly valued products such as Culture 24 and Collections Trust.

· the Strategic Commissioning Programme - helping to build the important relationship between museums and schools (funded through DCMS and DfE).

· National initiatives such as Reference Online, People’s Network.

· The Future Libraries Programme

· Working in close partnership with The National Archives to ensure that archive services are integrated into wider public service agendas with the ambition of making them more accessible to the public.

Arts and heritage funding

· 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?

· Whether the current system, and structure, of funding distribution is the right

one?

· What level of public subsidy for the arts and heritage is necessary and

sustainable?

20. With tourism being the UK’s fifth largest industry and heritage and culture being the overwhelmingly most popular reasons for visitors to come here ( the UK has five of the twenty most visited art museums in the world) it makes good business sense to ensure adequate resources are invested in our arts and cultural institutions. The economic benefits of the UK’s major museums and galleries alone are estimated to be 1.5 billion per annum 1.

21. The total national cultural spend amounts to only 1% of the NHS budget 2, in terms of the ‘quality of life’ return, we feel this represents good value for money on the public purse. Cuts to spending in an area which already only represents a small slice of public expenditure, we fear will have a disproportionate affect on social outcomes. The obvious impact of cuts would include increased closures, reduced services and less accessible collections.

22. Together with other NDPBs, MLA has supported the DCMS research programme known as CASE. The data from this investment has recently begun to show real benefit in relation to a better understanding of the impact of culture and cultural engagement on – for example – public well-being, confidence and aspiration. We believe that more can be made of this evidence in planning future provision for culture and the arts. In particular, we urge the spreading of better cross-Whitehall understanding of the benefits and positive social outcomes of culture and the arts, for instance in relation to health, the ageing demographic, need for more rounded education, skills development and the development of a stronger digital strategy for all ages and socio-economic groups.

23. We hope for cleverer investment in museums, libraries and archives which is not based on short term budget cuts but will allow greater freedom, flexibilities and stability to respond to changing public need and deliver long term benefits for all.

Joint working

· What arts organisations can do to work more closely together in order to reduce duplication of effort and to make economies of scale?

24. The MLA works closely with relevant NDPBs and other key bodies to a philosophy that says the user must be put first and that local government shouldn’t be expected to have separate conversations with government agencies when one will do. Time and money has been saved by closer collaboration at regional and national level, particularly between MLA, Arts Council, English Heritage and Sport England. The Living Places Programme is a good example of how sharing of a Programme can make the Programme both cheaper, and more effective.

25. The principles of Total Place also need to be understood and applied. Essentially, this is a call for ‘systems thinking’, in which assessments of demand, benefit and consumer value take priority over more traditional supply-side economics. There is evidence that ‘systems thinking’ can bring about more efficient delivery and greater user satisfaction. Simply sharing services is not enough: Pilots have shown that the savings and benefits depend on re-shaping services.

26. For greater efficiency and user led outcomes, we have published on our website the results of work that promotes amongst museum, libraries and archives the use of new governance and delivery models which requires:

· the support and involvement of stakeholders in the public, third and private sectors;

· looking at ways of co-locating and integrating services;

· working more effectively across local government boundaries, and;

· exploring public/private partnerships, trust status and community ownership

27. For Renaissance we propose a new model of central/local funding embedded within a place-based philosophy, which should include wider organisations such as HLF, ACE and potentially others. We also need local authorities, universities and independent museums to create dynamic local partnerships across the cultural sector and beyond.

Private giving

· Whether businesses and philanthropists can play a long-term role in funding

arts at a national and local level?

· Whether there need to be more Government incentives to encourage private donations?

28. It is clear from international models that businesses and philanthropists could play a greater role in arts funding. Present governance models for much of the sector mitigate income generation and enterprise resulting in over reliance on public subsidy and an inability to lever in additional investment. Many trusts and philanthropists currently exclude local authority funded services because they consider them to be ‘primarily the responsibility of central or local government’. However, the funding disparity between successfully self-funding London-based arts organisations and those least successfully developing funds is worth £206.7m 3

29. There are also ways in which government could change the current taxation system:

· Gift Aid could be greatly simplified and benefit from a composite rate and an automatic opt-out system for tax households

· The Treasury could agree to offset the value of cultural/historic objects given to museums, against Income Tax

· the current Acceptance in Lieu scheme could be extended to allow offers to be offset against Capital Gains Tax and Corporation Tax, and

· the Schedule 3 list (which allows national, local authority and university museums to buy pre-eminent cultural objects at a tax-remitted price) should be modernised to include trust and charitable bodies. This could be achieved by extending Schedule 3 status to all MLA Accredited institutions.

Appendix

· In 2008/09 national government through DCMS and its agencies spent £553m on museums, galleries and libraries, compared to council spend of £1.8bn on libraries, museums, galleries and archives.

· Over three funding rounds £291miilion has been invested in regional museums through the Renaissance programme. This year, £51m is budgeted for, £43m of which goes directly to the Hubs of regional museums. These museums in turn heavily rely on local government for most of their operating costs, though in some cases museums are over-reliant on the Renaissance programme for their day to day costs. This is a challenge that MLA has been confronting through its field team engagement.

· The ten phase one areas who are taking part in the MLA/LGA/DCMS Future Libraries Programme are:

1. Northumberland with Durham

2. Bolton, with Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside, Trafford, Wigan

3. Bradford

4. Lincolnshire, with Rutland, Cambridgeshire, North East Lincs, Peterborough

5. Suffolk

6. Oxfordshire with Kent

7. Herefordshire with Shropshire

8. Cornwall with Devon, Plymouth, Torbay

9. Lewisham with Bexley, Bromley, Croydon, Greenwich, Lambeth and Southwark

10. Kensington & Chelsea with Hammersmith & Fulham

· MLA published Sharper Investment for Changing Times, which sets out how we believe museum, library and archives services can and should change for the public benefit in the current economic climate.

· More www.mla.gov.uk

September 2010


[1] Cultural Capital: A Manifesto for the Future, April 2010 ,pg 5

[2] Cultural Capital: A Manifesto for the Future, April 2010,pg 11

[3] A&B PIC Report 2009