Funding of the arts and heritage

Written evidence submitted by Leicester City Council Cultural Services Division and also as Lead Partner for Renaissance East Midlands (arts 173)

Summary:

· The proposed spending cuts will seriously damage the arts and heritage sector’s ability to "make a difference" by supporting key public agendas.

· Their impact will be particularly felt in the most disadvantaged areas and communities.

· Cultural and heritage assets and activities should be maintained at such a level that they can be valued and used, effective, relevant to and reflective of the people and communities they serve.

· Public subsidy should be sufficient to provide capacity for them to be able to access additional income e.g. through grant applications, commercial activities, sponsorship and private benefactors.

· The Renaissance in the Regions Programme has been vital to enable museums to begin to more fully achieve their potential as contributors to key agendas, and it is important that it continues.

· However, along with other important aspects of MLA’s work, it could be managed in alternative, possibly more cost effective ways. It also needs a "lighter touch" and less micro management. The national framework of hub partnerships would be capable of delivering much of the existing Renaissance Programme with direct funding from DCMS.

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 ability of Arts and Heritage to help improve people’s lives, raise aspirations and create more cohesive communities through support for learning, social cohesion, cultural identity, local pride, sense of place, wellbeing, spiritual fulfilment, and economic regeneration including through tourism and the creative industries will be affected by the reduction in the number and quality of venues, programmes, services and activities provided. The reductions mean that fewer people will participate in cultural activities.

· The impact of recent spending cuts has been to create pay and recruitment freezes in the arts and heritage sectors. This has reduced capacity to deliver and has directly affected front line services.

· Reduction in the number of people employed in the cultural sector, and an increase in unemployment

· Fewer work opportunities for young people, especially recent graduates

· Increased charges and charging – some sections of the community will be priced out of the market

· SME’s will cease to exist in the creative industries, heritage and arts sectors

· Voluntary organisations reliant on grant funding may cease to exist or be reduced.

· The volunteering opportunities lost through the reduction in capacity or government funded organisations will be greater than the number of volunteering opportunities gained by replacing paid work by voluntary labour and through increased numbers of unemployed people.

· Spending cuts are resulting in introduction of and/or increased charges

· These effects will be felt by the most disadvantaged communities and neighbourhoods, since much funding for activities is prioritised towards them

· Although education budgets will be less affected, the reduction in arts and heritage funding means that organisations will have less capacity to work with schools and young people.

Local Effects for Leicester

· Leicester has high levels of deprivation, leading to poor life prospects for many of its citizens. It also has particular social cohesion issues arising from its diverse population, and challenges supporting many new communities including high levels of refugees and asylum seekers. Arts and Heritage funding has helped to address these issues

· The effects of cuts will be particularly felt in areas like Leicester where the public sector provides a high proportion of jobs and economic activity.

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

· Organisations with similar products could combine together in trusts or partnerships to share and streamline governance/ administration/ management/ backroom services

· The benefits of working across local authority boundaries should be explored

· Many local authorities, like Lincolnshire and Leicestershire, already have partnership organisations supporting the creative industries, which could be further developed.

3. What level of public subsidy for the arts and heritage is necessary and sustainable;

· It should be sufficient to ensure that cultural/heritage assets and activities that people value and use are maintained at such a level that they can continue to be used, effective, relevant to and reflective of the people and communities they serve.

· The range of subsidised assets and activities needs to reflect the range of interests of different groups, of all age groups, communities, cultures etc.

· The level of subsidy should enable the activities/assets to have the capability to develop and be useful. Insufficient levels of subsidy might mean they stagnate and become irrelevant and do not provide value for money.

· Funding should not be spread so thinly that it is not effective- the level of subsidy should be decided as part of a quantity/quality expectation.

· Over the last decade many museums services have already increased the amount of income they generate in addition to public subsidy to 20% - 50% of turnover and will continue to develop income generation streams, but there is a limit to the amount that can be achieved in this way without adequate public funding underpinning it.

4. Whether the current system, and structure, of funding distribution is the right one;

· There is a proliferation of funding streams (even within single organisation) and these could all be more streamlined and strategic (avoiding duplication, multiple reporting structures, reducing organisational administration costs)

· Funding for the cultural sector could be brought together in a single body or smaller number of bodies so that it is more strategic

· The funding for the Arts via ACE and the funding for Heritage via HLF and MLA/Renaissance have been delivered in different ways and it is right to review them to ensure the system is as effective and equitable as possible.

· Arts funding has been available for many years but it is only since 1995 (HLF) and 2004 (Renaissance) that museums and the heritage sector have had their need for funding recognised in the same way. This made a huge difference to the museums and heritage sector’s ability make an impact and to be better appreciated. Government funding for both Arts and Heritage is important must continue.

· The different styles of the main funders- ACE, HLF and MLA, all have strengths, but none achieve the right balance. ACE often seems to be too relaxed, whilst MLA micromanages too much.

· Renaissance in the Regions funding has always had a tension between the particular needs of large museums and galleries in major urban centres and the wider needs of museums and heritage more rural areas and smaller communities in each region, between making the best use of assets of national significance and assets of local significance. In the new structure for Renaissance these different needs have to be fully understood and met.

· The existing Hub structure for Renaissance with the 9 Lead Partners is capable of delivering much of the Renaissance programme efficiently and effectively, and a direct funding agreement from the DCMS to the Renaissance national museums partnership along the lines of its national museum funding agreements should be explored

· There is considerable frustration amongst our Renaissance Partners about the way in which the administration of the excellent Renaissance programme in England by the Museums, Libraries and Archive’s Council has become more and more bureaucratic and cumbersome. To take one example, prior to April 2009 MLA had a single funding agreement with Leicester as the accountable body for the programme in the East Midlands. Partner services (Lincolnshire, Leicestershire, Derby City, Nottingham City and Northampton Borough) worked with Leicester City to create a unified regional programme. Leicester distributed the funding through agreements with partner services such as Lincolnshire County Council’s Heritage Service. Leicester also collated the statistical and financial information required by MLA. Since April 2009 MLA has insisted on direct agreements with five partner services including Lincolnshire and still requires Leicester City to collate information. Five agreements are now required, increasing bureaucracy both for MLA and partner services. Quarterly returns now have to be submitted to both MLA and Leicester City and what was once a regional programme is increasingly becoming a series of county or city wide schemes.

5. What impact recent changes to the distribution of National Lottery funds will have on arts and heritage organisations;

· In theory more funding should be available to the cultural sector, however in practice organisations will need the capacity to apply for and manage lottery funding, which will get harder as organisations reduce staff numbers as budget reductions take effect.

6. Whether the policy guidelines for National Lottery funding need to be reviewed;

· They should all be reviewed regularly e.g. every five years to ensure that they remain relevant and appropriate to changing requirements.

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;

· The abolition of MLA is not necessarily a problem as long as key successful areas of work that MLA currently undertakes are delivered– especially Renaissance, Accreditation, Designation, National Security Advisor and Goverment Indemnity, Acceptance in Lieu.

· The combination of Museums and Libraries did not work since they deliver on different agendas to different audiences. Archives sit better with museums than with libraries.

· A merged HLF and English Heritage as proposed could be an effective body to engage with museums, delivering those aspects of MLA’s work which were not suitable for the Renaissance national museums partnership to deliver.

· It would not be appropriate for ACE to manage the Renaissance programme, but the key relationship between ACE and museums and galleries should be recognised. Renaissance East Midlands developed and leads the successful national Museumaker programme which shows how museums and arts can work together.

· Other bodies which could take on some of this work include the Collections Trust, and HM Treasury

· Of key concern is whether the museums, libraries and archives sector will continue to be heard by government after MLA ceases to exist in 2012. Renaissance museums a vital "Place at the Table" alongside the rest of the Cultural Sector and this must not be lost.

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

· For national organisations and those based in London/ affluent areas – Yes

· It is much more difficult in the regions, especially in the more deprived and less populated areas. It is very difficult to secure sponsorship or philanthropic support in the East Midlands, especially in cities like Leicester and rural areas like Lincolnshire.

· This question should also include heritage- why just the arts?

9. Whether there need to be more Government incentives to encourage private donations.

· Yes – tax incentives will encourage donations of money and collections

· Businesses and philanthropists should be given adequate incentives to support arts and heritage- the Acceptance in Lieu scheme and gift aid are important but more could be done by the government to encourage support especially in areas that do not benefit so much like the East Midlands

September 2010