ACE scrambles to make savings

While Arts Council England (ACE) appears to have suffered the brunt of Jeremy Hunt’s budgetary belt-tightening at the DCMS, local authorities up and down the country have emerged as culture’s under-reported losers. As the second largest supporters of arts funding across England (contributing around £220m to direct arts services and often matching the ACE subsidy provided to local cultural organisations), 353 councils now face an immediate and combined expenditure squeeze of £1.17bn. Additional, harsher cuts are expected in the autumn following the emergency budget to be delivered on 22 June. While political commitments are in place, to some extent, to protect health and education, the slash in spending on unprotected services such as culture will translate to as much as 20% in many areas. The National Association of Local Government Arts Officers (nalgao) has confirmed the figure is double what most local authorities have modelled for.

Meanwhile, ACE – which claims to have already made an immediate £4m in efficiency savings in 2010/2011 (following a major organisational restructure in the last year) – faces an additional cut of £19m. The total reduction therefore demanded of ACE this year is £23m which, uncoincidentally perhaps, is the same figure ACE spends on its own running costs (5% of the overall grant-in-aid budget). Dame Liz Forgan, Chair of ACE, failed to disguise surprise and disappointment at the announcement: “We all knew this year would be tough. We do not understand why we have received a higher percentage cut than other DCMS funded bodies,” she said, referring to the 4% cut imposed on culture (resulting in an extra loss of £5m in real terms) versus the 3% cuts placed on sport, media and the Olympics.
Alan Davey, Chief Executive of ACE, has underlined the organisation’s commitment to absorb as much of that financial pain as possible – although how feasible this is, given that ACE says plans are still being urgently drawn up to deal with the matter, remains to be seen. “We are now getting on with the task at hand,” Davey said, to “[make] sure we do our absolute best to minimise the impact on the art and the frontline organisations who enable it to happen”. ACE has confirmed that any trickle-down cuts passed on to its regularly funded organisations will be confirmed and announced before 22 June. All options, says the body, are currently under review.
Jeremy Hunt (who a week prior to the Treasury deficit being revealed had promised that the “arts would not be singled out”) said that the 4% cut to culture was wholly necessary to “get the economy back on its feet”. The nation’s finances, he said, “are in the interests of all our sectors, particularly the arts and culture sectors which receive significant amounts of private finance”. The DCMS also stated, however, that ACE would be granted permission to access its historic reserves – worth over £18m – for the first time; requests to do so were repeatedly denied under the last government.