Along with everybody else connected to the theatre industry, we warmly but cautiously welcome the government’s bailout package announced late on Sunday night.
The timing seemed odd to say the least. This writer discovered the good news thanks to a press release from the RSC timed at 9:54 PM. This was a response to another press release issued at around the same time jointly by the Department of Culture Media and Sport and the Treasury.
The headline figure of £1.57 billion sounds fantastic but it is necessary to drill down in order to understand what this might actually mean in practice. It has been suggested that this has been designed to tide over arts organisations until next April.
Unfortunately, drilling down is not yet an option since, in line with recent government precedent, the details have not yet been formulated.
However, here is a first attempt at analysis, which will undoubtedly be developed over coming weeks as those precious hard facts become available.
The first thing to note is that headline figure is not quite as good as it sounds. It breaks down as follows
- A £1.15bn support pot for cultural organisations in England, consisting of £270m in loans and £880m in grants.
- £100m of targeted support for England’s national cultural institutions and English Heritage.
- £120m of capital investment to restart construction on cultural infrastructure and for heritage construction projects in England paused because of the pandemic.
- Extra money for devolved administrations, with £97m for Scotland, £59m for Wales and £33m for Northern Ireland.
An immediate reaction is that the £120 million of capital investment, while welcome if it is new money, is not going to be of much use to anybody in the short to medium term. Similarly, most arts organisations will derive no benefit from the £100 million for cultural institutions and English Heritage. However, this might be great news for The National and the RSC?
From here on, for the sake of simplicity given that there is no information, it is assumed that the money for Scotland, Wales and Northern Ireland will benefit arts organisations in those countries proportionately to the English package, although devolved governments may distribute it on a different basis.
Everyone in theatre will justifiably be getting excited at the prospect that a lifeline is being dangled. However, they will need to share the cash with an awful lot of other people suffering in the creative industries.
It is supposed to benefit museums, galleries, theatres, independent cinemas, heritage sites and music venues.
There is no suggestion as to how much is going to be offered to each sector.
How can anybody not welcome outright grants worth £880 million for the arts sector plus loans of £270 million? Well, Shadow culture secretary Jo Stevens, while welcoming the announcement warns that for many it is “too little too late”. That is certainly the case for the theatres that have already closed.
Let’s look at the numbers. According to Rishi Sunak in the press release, there are 700,000 people employed (including self-employed one imagines) in the sector. The simple maths suggests that the grant equates to roughly £1,250 per worker. Throwing in the loans, the figure gets to just over £1,600. This represents less than one month of furlough for an employee earning £25,000 a year.
By way of comparison, TfL is to receive £1.6 billion and has 28,000 employees (over £57,000 per employee), Lufthansa €9 billion to cover its 135,000 employees (in sterling terms £60,000 per employee). Closer to home, Virgin Atlantic is asking for £900 million to save 8,500 employees (£105,000 per employee).
The worst of these is around 35 times as much as the arts sector. Even throwing the capital elements back in you still get to a multiple of 25.
The point is consolidated by a letter to the Guardian from Dr Simon Sweeney at the University of York, in which she points out that “In March, Germany’s culture minister, Monika Grütters, pledged €50bn to support the creative sector, and ministers complained this was insufficient and asked for more.”
One is left wondering whether Oliver Dowden and Rishi Sunak have got the numbers wrong when it comes to the arts or, possibly, wanted to take the plaudits while hiding behind a big headline figure?
This columnist, who spends far too much of his time foraging through government announcements, has never previously seen anything like the press release issued by DCMS and the Treasury, which might explain why it came out late on a Sunday night. The detail is dwarfed by quotes from significant figures across the sector.
This includes anyone and everyone from Sir Nicholas Serota at the Arts Council to Julian Bird at the Society of London Theatre, playwright James Graham, violinist Nicola Benedetti and Lord Lloyd Webber.
The Arts Council
It almost certainly makes sense to employ the Arts Council as the body to determine and distribute the fund and the loan. However, as most people in the industry have discovered over the years, the Council can be both generous and cruel when allocating limited funds.
This means that while many organisations will be rubbing their hands together with glee, those that have not been favoured in the past might already be in tears at the prospect of banging on a firmly locked door.
It would be good to hear from readers but in the past, the Arts Council hasn’t had a reputation for acting swiftly, generally requiring the completion of long applications that then have to be pored over for ages.
A Cautious View
As quoted in The Independent, the Conservative chairman of the House of Commons culture select committee, Julian Knight MP, has offered a very balanced opinion, which one hopes that Oliver Dowden takes on board.
"This is the first step to help prevent some of our major cultural institutions from going under," he said. "This money is welcome and should take some out of the danger zone, if only temporarily. But to secure their long-term future there needs to be a targeted sector deal, possibly involving more generous tax breaks.
"We know that 1m social distancing doesn't work economically for most theatres and venues in the UK. We ultimately need to have a means by which these organisations can open safely and gain the confidence of the public. We'll await further details in the guidance when it is published."
Please note that this article was updated and revised with additional information in the section on The Numbers on 10 July 2020.