Arts Funding Cuts Reveal the Government's Poor Business Sense

Posted by Daniel Bye Tuesday 27 July 2010 16.12 BST guardian.co.uk

Arts funding cuts reveal the
government's poor business sense

The arts are affordable and profitable, costing as little to fund as half a pint of milk a week per person. The government would be idiotic to cut them
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Milked ... The culture secretary's proposed cuts could buy us each half a pint of the white stuff a week. Cheers, Jeremy. Photograph: Christopher Thomond

Whenever there's an economic squeeze, the arts are first to go. Ministers such as Nick Clegg and Jeremy Hunt may endorse the defence of the social, cultural, even moral value of the arts, but they cut them anyway. So inevitable do reductions seem, playwright Mark Ravenhill has even suggested the best place to start cutting.

If they're so inevitable, why bother writing those defences? Because this time it's different. This is the first time artists have had access to sound, well-evidenced arguments for the economic value of the arts. It's no longer in question: the arts are affordable and the arts are profitable. If the government is interested in saving money, it would be idiotic to cut them.

First, the annual cost of British arts subsidisation is £0.47bn – roughly 0.07% of public spending. That's 7p in every £100, which equates to 17p per person per week or less than half the cost of a pint of milk. Cutting the arts budget would therefore save next to nothing, especially as the cost of the arts vanishes when placed alongside other government spending. According to Mervyn King, the Bank of England governor, the size of the bank bailout is "breathtaking" at close to £1tn. Not many of us even realise how big a trillion is. A million seconds takes 11.5 days; a trillion takes 31,709 years.

All right – it's not as bad as it sounds. Like the arts budget, some 60 million of us share the cost of the bank bailout. Divided evenly, then, we each shoulder a one-off payment of a mere £16,666.66. Bargain. At a rate of half-a-pint a week, that would buy enough milk to last you until the year 4780. If you think about the figure in terms of distance rather than money, the gap between our weekly share of arts subsidy and our share of the bank bailout is the difference between the height of a small book and the height of three Everests. In duration, it's the difference between the time it takes to read this paragraph and the time it takes to win the Tour de France. Including sleep.

Another fun factoid. Jeremy Hunt, the culture secretary, thinks the arts should be looking to philanthropy to fund the impending shortfall. Perhaps he's volunteering. As the fourth-richest of 22 cabinet millionaires (it was 23 before David Laws resigned), he can certainly afford to. The combined personal wealth of the cabinet would easily cover the Arts Council's £58m grants budget, used to fund work by new and emerging artists. Vive la redistribution! (Artists are having fun minting comparisons like these. To find more, follow the #artsfunding hashtag on Twitter. Or, of course, discover your own.)

Somehow I think we'd all feel more secure with regular subsidy paid for by less violent reshuffling of wealth. As would the exchequer. Of all the absurdities behind the potential cuts to the arts, the greatest is that they are directly, unequivocally profitable. In 2008, Arts Council England spent £100m on theatre; VAT receipts from London theatre alone were worth £75m. But hang on – everyone knows the arts lose money. How can they be profitable? Because Arts Council money is the thin end of a wedge prising open loads more investment. Every pound from the Arts Council buys several more – most of them directly contingent on that public subsidy. So the reality of a 25% cut from central government could result in something much, much worse, especially as arts organisations struggle to meet redundancy payments for staff they can ill afford to lose. (And yes, Mark Ravenhill, marketing and development teams are earning their keep, especially outside London.)

So the arts are affordable, and the arts are profitable. Of course, the value of the arts can't be measured in pounds and pence alone – and yet they're earning their keep in pounds and pence alone. The Tories like financial strategising, so let's put it this way: cutting something that makes money is simply a poor business plan.

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