News Release

Embargo: for publication after 09:30hrs Tuesday 24 July 2001

New study casts doubt on the value of state support for the arts

Public support for the cultural sector totals over £5 billion a year. But are we getting value for money?

The UK Cultural Sector: Profile and Policy Issues, the most comprehensive study of the subsidised cultural sector, published today, 24 July 2001, by the Policy Studies Institute, raises some vital questions about the value and outcomes of the subsidy the sector receives. It reveals:

• an absence of reliable and consistent data amongst official bodies as to how money is spent and to what effect
• a serious lack of analysis, which impairs both decision making and policy outcomes.

No one agency is responsible for gathering data on the cultural sector in the UK. There are, for example, no single sources of information about local authority funding, European funding, or even Lottery funding. Official data tends to be broad brush, and is of little use in building up a picture of specific areas of cultural activity. Data held by national and regional agencies are almost always incompatible. And whole tracts of data commissioned by publicly funded bodies are unavailable for use by outside agencies.

The UK Cultural Sector editor, Sara Selwood, comments:

"How can we know if we're getting value for money if the official bodies don't even know where all the money is going, where it comes from, or how it is spent? This is the first time that a comprehensive profile of the sector has ever been attempted and the lack of data is shocking. What's really worrying is that that the situation isn't much better as regards new sources of funding. For example, there's no single, centrally-held consistent and definitive set of data on Lottery funding for the cultural sector.

"Despite the figures used for advocacy purposes, little information is available - or known - about how many organisations receive subsidies; how many people go to subsidised events and activities; who those people are; how many people work in the subsidised cultural sector; or the level and kind of impact cultural subsidies are actually having.

"How can we have 'evidence-based policy', when there's no evidence?"

The study also questions to what extent the objectives of the Department for Culture, Media and Sport, the largest provider of subsidy to the cultural sector, are being delivered. It argues that the degree to which the relationship between policy, funding and the achievement of strategic objectives is discernible is unclear. In spite of numerous initiatives, no evaluations of the extent to which grant funding is delivering policy objectives have yet been established.

Despite the vagaries of the data, The UK Cultural Sector, compiled over two years by a team of 25 experts, provides the most extensive and transparent overview of the sector to date. Its findings reveal that:

• The total value of funding from DCMS has decreased in real terms by 20 per cent in the years between 1993/94 and 1998/99.
• This decrease was partly offset by income from the National Lottery. But in 1998/99 the value of National Lottery funding to the sector had more than halved since 1996/97 - falling from £814 million to £369 million.
• The BBC's licence fee is the single most significant single source of funding to the cultural sector, providing £2.2 billion. DCMS accounts for £944 million, and other government departments £455 million. Local authority funding amounted to £1.3 billion - nearly 3.5 times the value of support provided by the National Lottery.
• The European Commission provided £52 million for cultural activities in the UK, of which less than 12 per cent came from its cultural programmes. The majority came from structural funds aimed at addressing economic deprivation.
• The UK subsidised cultural sector itself (excluding BBC and public libraries) generated £1.5 billion in earnings and attracted £750 million from the private sector.
• In Spring 1999 some 647,000 people had their main job in the cultural sector - this represents about 2.4 per cent of total employment in main jobs in the UK and an increase since 1995 of nearly three times the rate of total increase in employment.
• On the basis of the evidence available it appears that adult attendances to the arts, built heritage and museums are declining. By 1998/99 ballet attendances were down 14 per cent on what they had been in 1994/95; attendances at plays were down 8 per cent.
• The report includes an analysis of the largest survey of cultural sector organisations ever undertaken in the UK. The survey reveals that organisations that receive support from the arts funding system in England are more likely to have received lottery grants than those with no such existing financial cushion. They are also more dependent on their funders as their main source of income; they spend more on their administration and have higher overheads; and have larger numbers of staff and higher staff costs than organisations with no such support.

According to Sara Selwood:

"This is the first comprehensive analysis of the financial workings of the sector. Its findings question many assumptions, dearly-held by the cultural community, about its own value. Is it really the case, for example, that subsidised theatre is more innovative than commercial theatre? How reliable is the evidence for arguing the economic impact of cultural venues and events? And what precisely is the nature of the relationship between the subsidised cultural sector and the creative industries?

"What we need is evidence to substantiate these assumptions. Policies whose effectiveness we can't judge are little more than political rhetoric."

Notes

1. The UK Cultural Sector: Profile and Policy Issues, edited by Sara Selwood, is published by Policy Studies Institute, ISBN 0 85374 789 X. Press review copies are available from PSI publications department on (020) 7468 2269. Click here for a copy of the presentation made at the press briefing on 24/7/2001 (pdf format). A summary of selected key findings from the report is available.

2. The study examines: the built heritage, film, libraries, literature, museums, galleries, performing arts, public broadcasting and visual arts. The survey refers to 1998/99 (the latest year for which data can be compiled) and shows that central government provided £1,400 million to the sector; BBC licence fee, £2,180 million; local authorities £1,256 million; national lottery, £369 million; higher education organisations, £33 million; and the private sector, £198 million.

3. The research was sponsored by the Monument Trust, one of the Sainsbury Family Charitable Trusts. Additional funding was provided by the Heritage Lottery Fund the John S Cohen Foundation; Trinity College, Dublin; the former Museums & Galleries Commission; and the Department for Culture, Media and Sport.

4. Sara Selwood is Quintin Hogg Research Fellow at the Centre for Communication and Information Studies, University of Westminster. She is editor of PSI's quarterly journal, Cultural Trends, and was an author of Culture as Commodity? The Economics of the arts and built heritage in the UK (PSI, 1996). The project advisors for The UK Cultural Sector: Profile and Policy Issues were Professor Stephen Creigh-Tyte, DCMS and Department of Economics, University of Durham; Andy Feist, Department of Arts Policy and Management, City University; Professor Nicholas Garnham, School of Communication and Creative Industries, University of Westminster; Professor John O'Hagan, Department of Economics, Trinity College, Dublin; Dr Patricia Morison, Sainsbury Family Charitable Trusts; Michael Pattison, Sainsbury Family Charitable Trusts. A full list of the 25 contributors is available from PSI on (020) 7468 0468.

5. PSI is a registered educational charity (no 313819) and has no association with any political party, pressure group or commercial interest.