Written evidence submitted by London Councils
and the Chief Leisure and Cultural Officers Association of London
(CLOA London) (arts 135)
This response is submitted by London Councils
(the cross party membership organisation of the 32 London boroughs
and the City of London) and the Chief Leisure and Cultural Officers
Association of London (CLOA London).
London is often the envy of the rest of the
UK for its levels of arts and heritage funding. However, many
of London's local communities are not touched by national or regional
cultural investment and as well as some of the highest levels
of cultural engagement, London also has some of the lowest.
There are going to be extremely challenging
times ahead for the arts and heritage sectors and London local
government like other funders will be making difficult decisions.
All funders will need to work closely together to ensure that
the inevitable reduction in public subsidy has the least negative
We are concerned however, in the turbulent times
ahead for the arts and heritage sectors that local organisations
and those working most closely with local communities are going
to see the worst impact. We therefore would like to see:
Government incentives which encourage
private sector investment and philanthropy but with particular
consideration to be given to those smaller organisations that
may not be able to offer private partners high profile.
DCMS ensure that those organisations
it funds either directly or through its NDPBs are committed to
greater engagement with local communities across London. This
could include linking to local authorities' cultural priorities
or to consider whether reinvestment in local museums could be
facilitated through, for example, charging international visitors
for museum entrance.
National Lottery investment reflect local
rather than national priorities with more local control over how
decisions about lottery funding are made to ensure that money
best addresses local need.
Government consider ways in which local
economic generation can come back to local communities to reinvest
as set out in the Prime Minister's recent speech on tourism.
Detailed comments on the questions are given
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
(a) Recent and future spending cuts from
central and local Government are undoubtedly going to have a huge
impact on the arts and heritage sectors.
(b) Collectively, local government is one
of the major investors in the cultural sector. In London alone,
the 32 boroughs and the City of London have a combined annual
spend on cultural services of over £509 million, with £79.4
million specifically for "culture and heritage",
This means that local government currently contributes around
half of the £1.1 billion investment by public bodies on culture
and sport in London.
(Further information on this can be found in the London Councils'
publication, "Playing Their Part")
(c) Local authorities however are under
unprecedented budgetary pressure and are going to have to make
difficult decisions over future funding. Non-statutory services
are inevitably going to be particularly vulnerable.
(d) Most arts and heritage organisations
are reliant on a complex mix of, often interdependent, public
funding streams and private sponsorship. Many local arts organisations,
for example, are revenue funded by both Arts Council England and
local government. Should one funder withdraw support, the organisation
will not be financially viable to other funders and the impact
to the organisation will be far greater than may have been envisaged.
(e) It is vital in these times that funders
work together to ensure that strategic joint decisions are made
that ensure the best outcome for local areas rather than knee-jerk
reactions. London local authorities often work closely with Arts
Council England individually and collectively, ACE supports the
London Cultural Improvement Programme and invites four elected
members onto its Regional Council. However, we need to be mindful
that there is currently no mechanism to arbitrate where there
are different priorities between different funders. It is vital
that local priorities are at the heart of every decision around
future arts and heritage funding, and local government is best
placed to do this.
(f) Where funding cuts are unavoidable,
these cuts should be implemented as part of a phased process to
allow organisations sufficient time to put contingency plans in
place/seek alternative funding.
(g) It should also be remembered that arts
and heritage organisations attract much inward investment, particularly
from tourism. This is particularly true in London where tourism
is worth over £16 billion per year and employs 285,000 people
and two-thirds of visitors give "culture" as their primary
reason for visiting the capital.
The loss of funding to arts and heritage organisations will therefore
have a detriment impact on the wider local economy.
(h) Whereas local investment supports arts
and heritage organisations that attract tourism, the economic
impact that they generate through additional tax yield goes directly
to the Treasury. As the Prime Minister stated in his recent speech
on tourism, "if a local council does more to attract tourists
to its area they know they'll be picking up costs but they'll
get none of the additional business rate revenue. Central government
sucks in 100% of this revenue generated by all local economic
growth. This is just mad. Local authorities must be allowed to
invest some of this back into their own communities." If
local authorities can access the revenue generated by local economic
growth it could be used to support those attractions that help
generate the revenue in the first place.
(i) The London boroughs recognise the economic
impact that can come from culture and are working together to
seize these opportunities. The five host boroughs of the 2012
OlympicsGreenwich, Hackney, Newham, Tower Hamlets and Waltham
Forest have pooled their resources to develop the CREATE festival.
Now in its third successful year, CREATE will return every summer
leading up to and following the 2012 Games. Based on research
undertaken with the University of East London, CREATE estimate
that the 2009 festival with its audience of 822,000 had an economic
impact into the local area of more than £15 million.
(j) As well as the economic benefit, London
local government recognises that arts and heritage organisations
are often focal points within local communities and have a positive
impact on people's lives and improve satisfaction with their area,
generating civic pride, community cohesion and a level of "feel
good factor", particularly during periods of recession. When
asked about their local area, residents who are satisfied with
their local cultural and sporting facilities are more likely to
be happy with their local area as a place to live.
Should funding be ceased or dramatically reduced, then these important
community elements may be affected similarly.
(k) This is supported by a recent GLA survey
on culture, indicating that 84% of Londoners think that the city's
cultural scene is important in ensuring a high quality of life.
And far from being a luxury, the survey showed 71% of respondents
feel that it's important that "taxpayers" money continues
to be invested in London's culture during difficult times, compared
to just 16% who disagree.
2. What can arts organisations do to work
more closely together in order to reduce duplication of effort
and to make economies of scale?
(a) London local government cultural services
are already developing new ways of working both in terms new models
of governance for cultural services and in joint working across
borough boundaries. The London Cultural Improvement Programme
has been driving this work towards more efficient working and
is recognised as an example of best practice nationally.
(b) There are undoubtedly ways in which
arts and heritage organisations can also work more efficiently
together and therefore lessen their reliance on public sector
funding in terms of mergers and/or formalising the sharing of
administration, management, technical services/expertise, premises,
and marketing, advocacy etc. This will play to the strengths of
each organisation and help drive efficiency.
(c) Local authorities can play a local leadership
role in these arrangements and in moving towards arrangements
of local cultural partnerships that address local need. In many
instances local authorities are already playing this advocacy
and brokerage role in bringing organisations in the borough together
to work collectively and share best practice.
3. What level of public subsidy for the arts
and heritage is necessary and sustainable
(a) Due to the different ways in which arts
and heritage are subsidised it is extremely difficult to give
one answer to this questions, especially due to the fact that
many public bodies that support these organisations, especially
local authorities, have to consider their level of public subsidy
for the arts and heritage in the wider context of other, competing,
demands for public fundingeg housing, social services,
many of which will be seen to have higher priority.
(b) We believe however in the fundamental
need for continued, stable public subsidy in arts and heritage
in order to deliver long-term strategies. The level should aim
to both ensure that the sector can flourish and contribute to
the economy in the way that it currently does, and also to ensure
that arts and heritage provision can be affordable and accessible
(c) Public subsidy in the arts and heritage
generates economic benefit. The creative economy has greater importance
in London than anywhere else in the UK. The Gross Value Added
of London's creative industries sector was estimated at £18
billion in 2007. Relatively small amounts of public subsidy have
stimulated a mixed economy culture and resulted in local and regional
(d) The arts and heritage sectors can help
economic recovery. Arts Council England note that between 1997
and 2006 the creative economy grew faster than any other sector,
accounting for two million jobs and £16.6 billion of exports
(e) Vitally the creative and cultural sectors
are identified as one of the top seven growth areas for London's
(f) It must be recognised that short-term
savings now may lead to situations that are not redeemable in
the futurethis applies in particular to conservation of
4. Whether the current system, and structure,
of funding distribution is the right one
(a) In the difficult times ahead it is vital
that funding reflects local needs and priorities. Local authorities
are best placed to know what these local needs and priorities
are and in many cases have the direct relationships with local
organisations and communities. By ensuring that local authorities
are at the heart of funding decisions, available money can be
directed in more targeted way to address local needs and aspirations.
(b) DCMS and its NDPBs must ensure that
nationally and regionally funded instructions are committed to
a local community approach and to working in partnership with
other local organisations. There are many boroughs, particularly
in Outer London who do not feel that these organisations are reaching
into their communities or that there is any attempt by these organisations
to align their work to these boroughs' local priorities.
5. What impact recent changes to the distribution
of National Lottery funds will have on arts and heritage organisations
6. Whether the policy guidelines for National
Lottery funding need to be reviewed
(a) The changes to the distribution of National
Lottery funds should help arts and heritage organisations although
we do not yet know how quickly this will translate to more funding
on the ground and particularly how those organisations that are
facing high reductions in revenue funding will be able to respond.
In order to make a real impact on a local level, the NLDBs should
be considering more radical changes that allow more local control
over lottery spend. This would ensure that this spend is responsive
to local needs and priorities rather than national.
(b) We do not want to set a precedent whereby
Lottery funding Is seen as replacement for, rather than complement
to, Treasury funding
(c) It is vital that we ensure flexibility
in the funding options available for smaller local/community groups.
7. Whether businesses and philanthropists
can play a long-term role in funding arts at a national and local
8. Whether there need to be more Government
incentives to encourage private donations.
(a) If businesses and philanthropists are
to play a long-term role in funding arts at a national and local
level there needs to be more Government incentives to encourage
(b) There is a strong concern that it should
not be assumed that there is enough capacity from the private
sector to "plug the gaps" that the inevitable reduction
in public sector funding is going to recreate. New arrangements
will take time to establish and cannot immediately replace government
subsidy. Fundraising relies on developing relationships and making
approaches from a position of strength or mutual understanding,
and as such, simply seeking funding to plug the gap left by government
will not be tenable. Recent announcements and media articles have
demonstrated that sponsors do not and will not see their role
as a replacement for mainstream funding.
(c) Cuts in public funding of arts and heritage
are likely to make the sector less attractive to private companies,
trusts, foundations, philanthropists and others. Private sector
funding is more likely to be secure by arts and heritage organisations
for specific projects rather than on-going revenue support.
(d) This is particularly true at a local
level. Those arts and heritage organisations who have a national/international
profile will be the ones most able to benefit from this type of
giving. More locally focused organisations, who in fact may be
the ones best delivering local priorities for their communities
will not be able to offer the same profile opportunities for sponsors/donors
and will inevitably struggle to compete with the larger organisations.
(e) Fundraising is a skilled and time consuming
role. Small arts and heritage organisations, often those working
in the most challenging communities, will be unable to achieve
the funding needed because of a lack of staff resources, critical
mass and skills; we do not want to create a situation whereby
large well known organisations able to attract finance surviving,
at the cost of the small companies. The arts sector is an eco
system, with grassroots artists and companies experimenting with
ideas, artists and audiences. By way of example, BAC in Wandsworth
feeds the Barbican Centre with new and extraordinary performances,
which the Barbican could never develop itself. If local arts organisations
are allowed to fail it will lead to a steady decline of the vibrancy
of arts in the UK.
78 CIPFA data 2008-09, Service Expenditure (Outturn
prices), Excluding Capital Charges: Cultural and Related Services-this
includes the CIPFA categories of Culture & Heritage, Recreation
& Sport, Open Spaces, Tourism and Library Service. Back
Public Expenditure Statistical Analyses 2009, HM Treasury, 2009 Back
Key visitor statistics, Visit London, 2009 and London Tourism
Action Plan 2009-13, 2009 Back
Place survey, Audit Commission, 2009 Back
Cultural Metropolis. the mayor's draft cultural strategy: 2012
and beyond, 2010 Back
Destination 20:20, LDA, 2010 Back