Cuts: ACE Announces £19m Arts Cuts, More Follow

All of ACE’s 800+ regularly funded organisations (RFOs) – of which 26% are theatres and theatre companies – will lose 0.5% of their grants in order to save £1.8 million overall. On average, that will equate to £2,000 less per organisation for the year. However, for the UK’s flagship theatres, the National Theatre (with £19,739,708 allocated to it in 2010/11) and the Royal Shakespeare Company (£16,010,444), it means a reduction of nearly £100,000 and £80,000 respectively.

ACE has managed to shield RFOs from more severe cuts by the exceptional use of £9 million of its historic reserves, access to which was previously blocked by government. Had that not been the case, organisations would have sustained a 3% cut – £10.8 million for the remainder of this funding year.

The remainder of the £19 million will be found from: £6 million saved from the postponement of a not-yet-announced major public engagement project that was due to launch next spring, cuts to audience development plans, and to funds for local authorities and the private sector partnerships; £1.8 million in reductions to the two highest funded organisations not directly producing art (£1.6 million from Creativity Culture and Education, a charity which gives arts access to schools in some of the country’s most deprived areas, and £0.2 million from Arts & Business, which promotes corporate sponsorship); and £0.4 million from further cuts to the Arts Council’s operating costs.

The last will bring ACE’s operating costs down to a total of £6.9 million this year, after a major restructure which has already seen the organisation shed 21% of its staff over the past 18 months. No further redundancies are planned.

Today’s announced cuts to audience development do not encompass A Night Less Ordinary, the free theatre tickets scheme for under-26s, which was launched last year. The DCMS announced this week that that scheme would be “curtailed”, but as its funding is allocated separately, it’s still unclear how – and how quickly – it will be wound down.

Also unclear is how ACE may benefit from the additional £50 million of National Lottery cash that Culture Secretary Jeremy Hunt says will be diverted to the arts annually; again, Lottery cash must be accounted for separately and, under current regulations, cannot be used towards any core running costs for ACE or its regularly funded organisations.

Crucially, today’s £19 million worth of cuts only covers the coming months to the end of the current financial year. The fuller extent of how badly the arts will suffer – and for how long – will become clearer once the government’s next Spending Review occurs, expected this autumn, from which the DCMS budget and the Arts Council’s share of it will be decided for the next three years (2011-14).

An ACE spokesperson told Whatsonstage.com that it would be “wrong, misleading and unhelpful” to speculate on future cuts but acknowledged that we all “know that it’s a very tough financial climate”. Previous figures reported in the press suggested that the arts may be facing longer-term cuts of up to £88 million – and the Arts Council does not have another £9 million in historic reserves to draw on to allay the worst again in future.

In the meantime, the 0.5% reductions to this year’s grants will be taken from the final payment of the year (in most cases the quarterly payment due in January 2011) in order to give organisations the maximum time to adjust their financial plans.

Dame Liz Forgan, Chair of Arts Council England, said: “In-year cuts are always the most difficult to manage, because plans have already been made against an expected level of income. But we have done our best to minimise the effect on our funded organisations and the art they produce so brilliantly.

“Some immediate impact was inevitable, and in the longer term the arts sector will also feel the effect of the cutting back of projects that are key to its long-term sustainability and development. But I am confident that the decisions we have taken are the right ones – for art, for artists and for the audiences we serve.”

Speaking of the bigger picture, Dame Liz added: “The financial climate is tough, but the arts remain a compelling case for public investment. We will continue to put that case to government, and to make it clear that now reserves have been spent, the burden of any further cuts will fall on funded organisations.

“Sustained levels of public funding are vital if we are to protect the world-class arts offer that previous government investment has built, and to maintain our long-term ambitions to achieve great art for everyone in this country.”

We will continue to update the Cuts Watch page as we gather more responses from theatres, industry leaders and arts organisations. Publicists can email contributions for publication to editorial@whatsonstage.com. Please also add your views to User Comments at the bottom of stories.