Let's start with full disclosure. I am not a statistician. I am not even that good with maths. And I don’t believe in magic.
That dealt with, WTF?
This week, Arts Council England released a report it had commissioned from the Centre for Economic and Business Research, and this report prophesies that the Government's Cultural Recovery Fund will be responsible for an earlier than predicted bounce-back for the arts and culture sector.
"What supernatural soliciting is this?" I thought. "I must read this report."
What I found is that the report is based on and caveated by so many assumptions, its framework has the rigidity of fairy-tale castle built on chocolate foundations. It looks okay until it comes under the glare of scrutiny—even mine!
The report separates out the £825 million to be distributed by the Arts Council from the £1.57 billion Cultural Recovery Fund pot announced in July and concludes that it will be responsible for an expedited return to pre-COVID Gross Value Added levels for the sector.
What is that? Gross Value Added is "a measure of the value from production used in the national accounts and can be thought of as the value of output less the value of inputs used to produce that output."
Now we have some idea what Gross Value Added is it is clear that that’s quite some claim given the report also says that the sector has lost an estimated 23% of its GVA in 2020 due to COVID. Even I understand that if you start with a negative figure and add a positive figure, the best you can end up with is a smaller positive figure.
However, before we go into the fantasy land of the report, let's look at some facts. The Arts Council's £825 million, in fact the whole £1.57 billion, should not be looked at as the general giveaway it first appeared.
Of the Arts Council's £825m:
- up to £500 million is allotted to grants of between £50,000 and £3 million to organisations with a record of financial stability but at imminent risk of failure. Applications were accepted from cultural organisations—being music, theatre, dance, combined arts, visual arts, museums, or literature but excluding libraries—over two rounds in August both now closed.
- £270 million is being divided into repayable finance programmes starting at £3 million with no upper limit. These programmes are available only to culturally significant organisations "at clear risk of no longer trading viably by 31 March 2021" who find themselves in the last chance saloon and who got their pitch in before the application windows closed.
- £55 million is available to existing Arts Council capital grant holders whose deliverables and/or financial resilience have been negatively impacted by COVID. The grant amount is unlimited and can be as much again as the original capital grant—an understandable protection of earlier Arts Council investments but nevertheless a clear case of those who have had getting more, no names no pack drill, leaving less for everyone else.
The CEBR's report compares two scenarios based on the projected Gross Value Added for the sector, in one scenario there is no government funding and in the other there is the £825 million.
The output of this exercise is that for the sector, GVA will have reached pre-COVID levels of £13,890 million as soon as 2022, being a year earlier than otherwise expected—and read that £13,890 million with a pinch of salt because "all GVA figures presented in this report are in nominal terms."
Furthermore, by 2023, things will be back on an even keel, returning to a "as if COVID never happened" position in 2025.
Its estimations "assume a particular interpretation of anticipated sectoral recovery" but to posit things being back to normal in a little over a year from seems doubtful at best. By its own admission, "the Arts and Culture sector is still well below its pre-COVID-19 levels" and "the recent recovery is also likely to slow down in light of the new restrictions".