Funding of the arts and heritage

Written evidence submitted by Artsadmin (arts 107)


· The UK arts landscape is one of the most creative, diverse and respected in the world; vital to the economy, central to tourism and a central part of the quality of life in this country

· Spending cuts in the arts will have a huge and disproportionate event across the whole of this landscape from national to local levels

· Arts organisations already represent some of the most collaborative and innovative business models in the UK

· A level of Government spending which continues the investment which has taken place in the arts over the last 15 years is the only way to ensure the continuation of this success

· The Arts Council, having already undergone major restructuring to save costs, is the right organisation to deliver this funding programme, provided the expertise is in place

· Philanthropy has a place alongside Government subsidy, but cannot replace this investment and will not support the provision of local arts projects particularly

Before the general election we attended several events and conferences where both Ben Bradshaw and Jeremy Hunt spoke of their passion for the arts, while warning that the arts could not be exempt from future spending cuts. Those of us working in the sector understand that any Government is unlikely to single out the arts for protection while cuts in public spending are taking place all around, but we would strongly argue that cuts in the arts are a false economy in the longer term, both in terms of the income the investment in the arts brings, and even more importantly, their crucial role in creating a better and happier society.
1. 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
The impact of the expected cuts, coming from central and local Government, as well as an expected reduction in box office income, will have a devastating impact on the arts, far deeper than simply a temporary reduction in funds, and recovery will be impossible for many arts organisations.  It will result in:

· Decrease in the experimentation and innovation which currently makes Britain a world leader in the arts

· Increased unemployment

· Reduction in opportunities for children and young people

· Fewer international collaborations

· Fewer training opportunities

· A less vibrant arts programme across the country; from the West End and national companies right through to small community projects

· A reduction in tourism

· A smaller return on the investment

· An unhappier society

It is important to remember that the arts are not just the big galleries and West End Theatres. The arts affect people’s lives in all parts of society. There are endless examples of the arts reaching ‘difficult’ young people who might otherwise end up in gangs, of arts projects helping young people gain confidence enabling them to find employment, of the arts bringing social cohesion to inner city areas and small rural communities. If this government wants to create a ‘Big Society’, then these (often small and less visible) arts programmes must be protected and supported.

2. What arts organisations can do to work more closely together in order to reduce duplication of effort and to make economies of scale
Most arts organisations already work in collaboration, they already use economies of scale, work flexibly and efficiently, and are often cited as entrepreneurial business models. The largest subsidisers of the arts are those who work within the sector, and most organisations do a vast amount of work on a shoestring budget – they can only be stretched so far.  

At Toynbee Studios, Artsadmin runs a producing organisation and an arts centre, sharing rehearsal spaces, offices, facilities and expertise to benefit hundreds of different arts companies. Many regional theatres ‘host’ smaller companies, to share resources and networks, and there are numerous similar models.

All aspects of the arts economy offer extremely high value for money spent.

3. What level of public subsidy for the arts and heritage is necessary and sustainable
The arts budget is very small, much smaller in percentage terms than most of our European partners – and works out at 17p per week per person. This level of funding is absolutely necessary, and even in this economic climate, is sustainable because of the level of employment created, the tourism attracted and income generated. A large proportion of arts subsidy is spent on low salaried employment so any cuts will impact on both unemployment and organisational sustainability.
Unlike most other areas of pubic spending, arts funding is an investment. For every £1 that the Arts Council invests, an additional £2 is generated from private and commercial sources, totalling £3 income. The returns in economic terms alone are huge, with tourists flocking to London as the world’s most vibrant cultural city, where subsidised productions such as War Horse move to the West End and attract huge audiences, paying back the original investment many times over. The arts are responsible for the regeneration of particular areas of cities, and for cities themselves –most recently Liverpool City of Culture for example, bringing £800 million worth of local economic benefit.

4.  Is the current system, and structure, of funding distribution the right one
The Arts Council does not have an easy role even within a healthier economic climate, but it is working closely with the arts sector whose views it regularly seeks, and has a (now lean) staff of professional and committed people. The arms length policy is absolutely crucial as direct funding from Government would not reach the smaller grassroots arts organisations whose role is so crucial to the community.
The Arts Council has already cut its own administrative costs greatly, and should not be asked to re-structure every few years, which is costly and unnecessary. Expertise is crucial, so that the right funding decisions can be made, allowing organisations to plan ahead, acknowledging the importance of research and development and being transparent in its decision-making.


7.  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
As stated above, the arms-length policy is crucial and we believe the abolition of these bodies will have a negative impact and could result in wrong decisions being made in the distribution of funds, which will cost money rather than saving it. It is crucial that those making decisions about funding the arts have the knowledge of the sector, resulting in investments being made responsibly and strategically.

8.  Whether businesses and philanthropists can play a long-term role in funding arts at a national and local level;
Many businesses and philanthropists, as well as trusts and foundations already play a long term role in the arts funding, but this can never replace statutory funding. Arts Council funding attracts further investment from philanthropists, but as many have recently made clear, they will not support the arts without matching government investment. If there is a reduction in government investment, local government investment and philanthropic donations will reduce accordingly.
It is also clear that philanthropic donations only really work for major institutions, and donors are much less likely to support small grassroots organisations, development organisations and young people’s projects. The American arts system only really works for the huge galleries and major theatres. Many small but crucial arts projects exist only hand-to-mouth, if they exist at all. It would be hugely detrimental to the cultural and creative life of the UK if it were to follow this example.

9.  Whether there need to be more Government incentives to encourage private donations
As stated above, private donations can never replace government subsidy, but can work alongside it, and some taxation changes might encourage more private investment – but again this will never reach the crucial arts projects that help create the Big Society that our government wish to encourage.

September 2010