An occasional column for invited writers to raise issues that concern them
Many new capital projects in the arts are taking shape and we can look towards an enriched society as a result; but Sean Egan would like to highlight a chink in the euphoria.
Surprising as it may seem this is a plea from a lawyer for a mechanism to reduce legal fees and possibly other costs associated with capital projects, so that more funds can be spent on the projects themselves. As a decreasing proportion of Lottery funding is being made available for capital projects, the money is being spread more thinly and there is more competition for funding. One of the effects of this is that many funded projects end up with a multiplicity of government or quasi-government funding sources, and those projects are often faced with major difficulties in closing the financing given the different requirements of those sources. Each project is unique with specific problems to overcome, especially in the larger projects, but it seems that the process of closing the funding ring has become more difficult and more expensive in recent years.
My perception is that government and quasi-government funders are becoming more concerned to ensure that they are protected absolutely against all future contingencies. Whilst it is absolutely right that their money should be spent wisely, and that funders do not allow themselves to be exposed, the net result is that larger projects may involve as many as half a dozen firms of solicitors representing the different funders. They may each be approaching the project by seeking to negotiate the best possible terms for their own client, as though the funders are commercial clients making commercial investments. The consequences are delay, which itself can lead to substantial additional costs, higher than expected legal costs and typically projects being forced into having to accept new and onerous conditions. I have no interest in singling out or identifying particular funders. My thoughts are much more for the projects themselves, which often have no alternative but to accept funding on steep terms and suffer whenever their funders, for whatever reason, do not work together to ensure that the legal process is efficiently and cost-effectively handled.
I do not underestimate the restrictions and difficulties that each funder faces in executing its duties to ensure the efficient use of its funds and the satisfaction of its funding remit. The National Audit Office is a fierce threat. However I feel there is scope for government and quasi-government organisations to liaise and co-operate with each other in their legal processes. I also appreciate that for my suggestion to work, the timing of funding decisions would need to be considered as consortia can only be formed if funding comes together at the same time. But if this could happen, I have no doubt that both the funders and the projects themselves would make savings.
Sean Egan is Head of the Arts & Media Department at Bates, Wells & Braithwaite Solicitors e: s.egan@bateswells.co.uk.