The UK culture sector woke up to some good news today, with a Government announcement of a ‘world-leading’ £1.57 billion rescue package, set to benefit thousands of organisations suffering the financial impact of the Covid-19 pandemic. The funding of arts organisations has never been more relevant. With world-famous cultural institutions, such as Shakespeare’s Globe Theatre, warning of the threat of insolvency, it is evident that many organisations across the sector face the threat of ‘ruinous losses‘, as the Chair of the National Campaign for the Arts (NCA) suggested last month when he announced the publication of a most insightful report on the financial health of the sector. 

The report, published by the NCA in partnership with the Creative Industries Federation and King’s College London, provides what it calls “a health check of the arts” – an Arts Index. This Index tracks the changes in how cultural institutions have been funded over the past decade (it covers the period from 2007-2018). Since 2009/10, public investment in the arts from the Treasury, the National Lottery and local government has fallen by 35%. The reduction in local government was 43% (from 2008/9). In comparison, earned income by revenue-funded arts organisations rose by 47% (since 2007/8). The apparent increasing reliance on earned income will affect how well museums and galleries can respond to the current pandemic, in which the opportunities to generate such revenue are much diminished.

The rise in the combined reserves of revenue-funded arts organisations was not evenly spread, meaning that, whilst some institutions might have funds to fall back on, others will not. Additionally, it has been noted that museums with diverse income streams have fared better in the current crisis. Large amounts of emergency funding have been made available from public sources such as Arts Council England, the National Lottery Heritage Fund (NLHF), and Historic England. Interestingly, the pandemic seems to have led to a shift away from funding specific projects to unrestricted funding. The need for financial flexibility in the museum sector has been seen in the United States also, although this has been in the context of the use of existing funds rather than new funding endeavours. Whether the shift in favour of unrestricted funding in the UK will outlast the pandemic remains to be seen.

At a recent webinar, hosted by the Art Newspaper, four museum directors discussed the topic “How can museums recover after Covid-19?”, with an emphasis on the importance of funding. Given the international nature of the participants, an interesting picture of different national approaches to museum funding was presented. For example, Tristram Hunt, Director of the V&A in London, explained that 50% of the museum’s annual turnover is made up of income from Government funding, whilst the other half is generated through commercial activities. When commercial income is so heavily relied upon, the financial impact of lockdown and museum closure is evident. Given that entry fees are not charged, Hunt noted that re-opening alone will not assist the financial recovery of the museum. Conversely, Carolyn Christov-Bakargiev, Director of the Castello di Rivoli Museo d’Arte Contemporanea in Turin, explained that a higher proportion of the museum’s income is from Government sources and that the Italian Government has a constitutional obligation to take care of national culture. The webinar also highlighted the interconnectedness of the arts sector, noting the need to support the entire ecology of the arts community. This need is exemplified by the fact that many museum funders may be reliant on the arts industry for their income. Going forward, according to Zoé Whitley, Director of the Chisenhale Gallery in London, museums are going to have to learn how to “do less with less”, focusing on the museum’s core mission.

National Gallery, London (Image Credit: Diego Delso CC BY-SA 4.0 via Wikimedia Commons)

Financial support for the museum sector has been directed to a number of particular areas in recent years. One such area is digital development. Needless to say, the ability of museums and galleries to produce digital content for remote access during lockdown has been essential to their efforts to remain relevant and retain pubic interest and support. Thus, the conditions engendered by the pandemic have highlighted the need for continued investment in this area of work. The NLHF, the largest dedicated funder of UK heritage, had already outlined in its Strategic Funding Framework 2019-2024 that it would encourage organisations to “embed digital thinking in every project”. Some examples of this kind of investment, and its benefits, have already been seen. The Understanding Landscapes project, started by the University of Exeter in 2017 and funded by the NLHF, has enabled volunteers to uncover dozens of unknown Roman settlements and roads by studying detailed topographical scans at home. Despite the enthusiasm for the digital over the past months, as Tristram Hunt noted in the Art Newspaper’s webinar, the “power of the object” and the “wonder of the place” cannot be easily substituted.

Another area of focus has been the funding of regional institutions. There has been criticism of the spread of public funding across the UK, noting the difficulties faced by smaller, regional museums. Nonetheless, there have been some bright spots for museums in the regions, including, for example, the Department for Digital, Culture, Media and Sport’s Cultural Development Fund which offered £20 million for towns and cities outside of London to invest in cultural initiatives. The NLHF has combined these two focus areas with its Digital Confidence Fund. This aims to grow the digital skills and confidence of organisations in thirteen key areas, all of which are outside of central London.

Continuing financial support for museums and other cultural organisations as they make their tentative first steps out of lockdown will be crucial. The opening of the National Gallery this week is good news, and others will likely follow soon, but it will doubtless take considerable time for museums and galleries to return to business as usual, resuming the full panoply of their revenue-generating operations.  It is hoped that the broad package of Government support announced today will safeguard the sector adequately in the meantime.