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Peer Review offers renewed support for arm's-length principle but urges improvements in ACE's relationship with DCMS and the arts community. A wide-ranging and independent report considering the overall effectiveness of Arts Council England (ACE) and its relationships with the arts sector and other partners has given credit to the organisation for its role in increasing the vibrancy of Englands arts sector, and establishing the centrality of the arts in national life.

However, the report reveals that the poor relationship between ACE and the Department for Culture, Media and Sport (DCMS) is undermining attempts to address future challenges. Friction arising from the last Spending Review is said to have led to a perception by ACE that the DCMS has placed it under increased scrutiny and duplicated its functions, while the DCMS believes that this scrutiny is necessary because it fears that ACE is unlikely to meet some of its key targets. The report states that This deterioration in relations has occurred at a critical time for both organisations, and [is] the key barrier to ACEs future success& Restoring mutually trusting and respectful relationships at all levels must be a priority for both parties. The report is the result of last summers ACE Peer Review, which was led by Genista McIntosh (Baroness McIntosh of Hudnall). It concludes that, in contrast with changes that have been made or proposed to the powers of equivalent bodies in Wales and Scotland, nothing would be gained from removing or reducing ACEs freedom to act autonomously and states unequivocally that ...government, the public and the arts community benefit from the focus, authenticity and reach that an arms-length body can provide. ACE has been specifically praised for its funding delivery and for developing new partnerships through schemes such as Creative Partnerships and Artsmark. The Theatre Review 2000, which led to the creation of a national strategy for theatre in England, was cited by respondents as one of Arts Council Englands greatest achievements in recent years, though the absence of dedicated strategies for other artforms is raised as an issue, as is the perception of a broader failure to engage with more diverse, amateur and newer forms of arts activity. The report also criticises the organisation for the quality of its dialogue with arts practitioners. Whilst recognising the existence of some strong working relationships between individual ACE officers and their clients, the review team has raised questions about ACE's overall credibility within the arts community, and in particular about the ability of its officers to speak authoritatively on individual artforms. Many of those who submitted evidence expressed anxiety about whether the level of expertise within ACE as a whole was high enough, a question which was fuelled by the appointment of a team of its own artform officers by the DCMS. A repeated observation made by contributors to the Review was that ACE personnel lack recent experience of working in the arts sector, and the organisation is urged to strengthen the authority of its own staff by ensuring that they are up-to-date with developments, and also by reviewing its recruitment policies in an attempt to attract candidates with high quality experience in the arts. ACEs organisational restructuring, which began in 2002, is viewed as having been successful, with the regional offices working effectively as part of the whole; but the report urges a re-consideration of the role of the national office itself, with a new, smaller office and - a streamlined role - focusing on forming partnerships within and outside the arts sector and providing evidence about the impact of arts spending. Welcoming the publication of the report, Culture Secretary Tessa Jowell said, The Arts Council now needs further to enhance its role, to strengthen connections with its artistic and wider constituency and to become even more the force in the cultural community we all need it to be. ACE has published an action plan taking forward the recommendations of the report.