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The funder has warned organisations seeking annual funding that they must demonstrate what they would deliver “should you receive a lower level of funding”.

Photo of theatre performance
Welsh arts organisations have been warned to prepare for potential funding cuts
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Valerie Ferguson

Arts Council of Wales (ACW) has warned organisations applying for its next round of portfolio funding that they should plan what activity they would be able to do if their funding is cut.

Investment Review documents released for consultation say: “We may not be able to fund you at the level you have requested and in some cases we might find ourselves obliged to consider reductions in funding. You should clearly show the implications and realistic levels of activity that you would be able to deliver should you receive a lower level of funding.”

“We expect all organisations to adopt a reasonable view of likely levels of future funding,” the funder says. It adds that applicants asking for “very significant” funding increases from 2021 “risk the very real possibility that we will have no option but to turn them down”.

Uncertainty 

ACW has warned that its projections of how many organisations it can support depend on a Government funding allocation to be announced in December.

ACW’s funding from the Welsh Government was frozen at £31.2m for both 2018/19 and 2019/20 “in a bid to provide certainty and stability” and “protect our valued public services from the worst effects of austerity.” 

While it is asking potential portfolio organisations to provide budgets for the three years from 2021/22 to 2023/24, it will only be able to confirm funding on a year-by-year basis.

“If Welsh Government funding reduces, our proposals will have to be rescoped … We may not be able to fund you at the level you have requested and in some cases, we might find ourselves obliged to consider reductions in funding.”

New investment models

The funder acknowledges in its proposals that “these are financially challenging times” for the sector.

“However, the Investment Review will not ‘make good’ cuts in partner funding. Even if we had the funds to be able to do this – which we don’t – we feel it’s important to try and maintain a diversity of funding wherever it’s possible,” the Investment Review document says.

ACW notes that new funding models will be needed to protect a “viable” portfolio: “we believe public investment will remain a core source of funding, but that core will need to reduce as a proportion of overall income.”

“It is likely that we’ll want to explore different models of investment.”

Next steps

ACW’s public funding for 2020/21 is expected to be confirmed next month. Consultation on the Investment Review closes 10 January.

Online applications to become or remain an ACW portfolio organisation will close on 24 April. Applications will be assessed against three proposed issues – the Wellbeing of Future Generations Act, supporting greater equalities in the arts sector, and developing and promoting the Welsh language – with decisions in principle announced in September.

New funding arrangements will take effect from April 2021.

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