Funding Cuts & Philanthropy

March 30, 2011 Leave a comment

The Arts Council of England’s funding cuts have been the big news of the day with only around 650 organisations (out of 1330) being successful in receiving funding – although the success varies from funding increasing to funding continuing but at a lesser rate.  But it does beg the question, how will those who were unsuccessful raise their income and how many will disappear under the pressure of lack of funds? 

Obviously, philanthropy and sponsorship have a role to play – and I’ve blogged here before about the coalition government’s desire to increase philanthropic gifts for the arts, including their support for giving in last week’s budget.  But we can’t rely on philanthropy and sponsorship to plug the gap entirely.  It’s too big a gap and often it’s needed to cover core costs, which are just not that appealing to philanthropists who, in general, tend not to give to areas which have traditionally or previously been funded by government, preferring instead to provide the ‘icing on the cake’.

No-one is under any illusion that organisations will need to think creatively about diversifying their income if they have any hope of surviving and over the coming weeks and months we will no doubt see more mergers or organisations adapting by creating social enterprise/social fund models – combined with a creative and strategic approach to fundraising.  Although in a small, low resourced organisation this is going to be a huge challenge to say the least.

And this challenge doesn’t just apply to the arts in England but to the entire charitable sector as a whole.  Government funding is going to reduce if it hasn’t already.  It’s going to be tough but there are also real opportunities out there to engage donors, optimise service delivery and achieve sustainable results.

Or perhaps I’m just being overly optimistic and a bit too glass half full?  What do you think?  Are the challenges insurmountable for small, lean organisations whose resources are spent on providing their core services without having to concentrate huge amounts of time on income generation?

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Tax Breaks & Philanthropy

December 9, 2010 1 Comment

I read with interest the article on BBC’s website yesterday in which culture secretary Jeremy Hunt (he of the unfortunate surname mispronouncation by BBC’s James Naughtie) announced that he wanted to encourage philanthropy for the arts through matched funding.

The plan is ambitious with £80m of government funds being set aside and arts organisations encouraged to fundraise for the remainder.  But it does beg the question, who is going to be able to achieve this?  Surely the bigger fish in the arts world with the contacts – and the resources – are going to fare better than smaller organisations?

In order for an organisation to set up an effective, sustainable fundraising operation of the sort Jeremy Hunt envisages, they need to at least have the resources available to them to research, recruit and look after their donors.  And corporate sponsorship is even more labour intensive with high demands placed on the recipients of such monies.  Most smaller organisations don’t have even one member of staff who deals solely with fundraising, never mind a fundraising team, so how realistic or achievable will it be to replace government funding with philanthropic gifts and sponsorship?

It is important to encourage philanthropy – although Jeremy Hunt’s suggestion that we should emulate the levels achieved in the US is unlikely to happen without a radical alteration of the tax system in the UK – and I firmly believe that all organisations need to think of introducing an element of fundraising into their income streams – increasing the diversity of their funding and helping them to become more sustainable.  But is it unrealistic to expect small, cutting edge, community-based or new work to achieve the same levels (proportionally) of more ‘traditional’ larger arts organisations? 

It may be an uncomfortable climate for all of the arts but I worry that new talent and the development of new ideas and audiences will suffer as a result of the plans of the current government.

Do you agree?  Perhaps you think the arts are expendable in terms of government support?

 

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Don’t Cut the Arts

December 6, 2010 Leave a comment

Dave Shrigley’s animation highlights the need to save the arts from dramatic spending cuts – not least because they bring tremendous benefits to the UK, including economic value, and for that reason alone surely investment to encourage growth is better than simply cutting back.

However, despite months of campaigning, the bad news just keeps on coming with Moray Council the latest to announce it is cutting the arts budget for the region which will impact negatively on community groups, mental health organisations, childrens organisations and other groups, as well as arts organisations and artists themselves.

Arts organisations are already lean, keen and creative – how will they weather this particular storm?

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What’s the Future for Arts Funding?

November 23, 2010 Leave a comment

As you know, as well as fundraising for a range of different causes, I have done a great deal of work (and continue to do so) with arts organisations.  Now is a particularly worrying time with government cuts ranging from 4% here in Scotland to a staggering 30% in England. 

I recently wrote a guest post for Arts Professional and am interested to hear how others, particularly those working in the arts, think their fundraising will be affected by the cuts.  I’m also keen to know how (or if) organisations intend to adapt their fundraising efforts in the future taking into account the increased pressure to diversify income.

Please let me know what you think by commenting on the Arts Professional blog – I’m interested to see what the main concerns are and will be blogging in the future – both here and on Arts Professional – about possible ways to improve fundraising efforts and increase income.

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Will Philanthropists Save the Arts?

October 25, 2010 Leave a comment

This was the question posed by Charlotte Higgins in the Guardian on 21st October regarding the Arts Council’s funding cut of 30%, as a result of the government spending review.  Museums budgets are also to be cut by 15% and, at the time of writing, there will be an anticipated but as yet unknown amount cut from arts budgets in Scotland and Wales.  

This is a question that needs to be answered.  In my post on The Future of Arts Funding, I mentioned the study carried out by Arts & Business which considered it unlikely that we could expect philanthropy to meet the income gap made by government cuts.  Not least because, as Vivien Duffield comments in the Guardian article, many donors feel that their contribution should be the ‘icing on the cake’ and not the cake itself.

Culture is an important expression of the human experience – but it’s also a key contributor to the UK economy.   According to Support the Arts, 6.2% of the UK’s local income comes from the creative industries, the arts provide over 2 million jobs and are mentioned by 8 out of 10 tourists as a reason for their visit.  Not only do the arts contribute massively to the UK economy, they do so whilst doubling the money invested in them – funding the arts costs everyone in Britain 17p per week.  The arts earn the government around 35p per person per week.  So even if you’re not an arts lover yourself, you can’t argue that investing in them does make economic sense – as artist David Shrigley illustrates (literally) in his animation.  

And, while all of the arts are under threat, what about small, regional, grassroots or community arts organisations?  The future seems particularly bleak for them as the Arts Council are surely more likely to try to save high profile arts organisations who are perhaps more vocal, more proficient at organising support and already have a strong base of supporters – and will therefore, be in a position to create a noise about any potential cuts to their budgets.

Higgins’s article featured quotes from a number of wealthy individuals, the majority of whom are based in and around London and who tend to give to organisations around the same area, often in the more traditional arts, such as ballet, opera and mainstream theatre.  Community organisations, children’s arts organisations or those based in towns and cities outside the south east tend not to receive donations from the Portraits, d’Offay’s or Lord Stevensons of this world.  They are unable to offer excellent seats for their performances in top theatres; or inscriptions on buildings and theatre seats.  They don’t feature in reviews by the London based broadsheets and their Board members aren’t on FTSE 100 companies. 

So how will smaller organisations raise money through philanthropy and sponsorship in an ever increasingly competitive market?  Many of these organisations are much loved and frequented by local audiences; they can be the breeding grounds for experimental work or the place where grassroots activities involving the wider community are developed.  Many talented artists and performers first made their mark in regional or community based organisations.  Perhaps most importantly, these organisations are often the first place where many people experience the arts – either as children or adults – and are therefore, the catalyst for many people becoming future audiences for the arts.

There’s no doubt that there will be worrying times ahead – and not just for the arts, for the third sector as a whole, as reduced government funding and a smaller welfare state is likely to put huge pressure on already limited resources, while competition for funds is likely to increase in the future.

The arts are well placed.  They are already lean, tend to have existing loyal audiences and are creative in their approach.  But the challenges they face cannot be underestimated and will no doubt take their toll on the future creativity and therefore, economic output of this country.

Perhaps you don’t agree – or perhaps you think that the arts can be sacrificed?  What are the major challenges your organisation faces in light of the government cuts?

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The Future for Arts Funding

October 18, 2010 1 Comment

Photo by Jean-Pierre Dalbéra, used under Creative Commons Licence

Two recent studies have highlighted the current funding situation for the arts which, like many other areas, is suffering as a result of the recession, while the campaign, I Value the Arts, aims to raise awareness of the added value the arts bring to the economy through a publicity campaign supported by well-known artists, such as Tracy Emin and David Shrigley.

A recent survey found that overall, more arts organisations where experiencing increased revenues than those experiencing shortfalls of income.  However, rates of improvement were slight and rates of fundraising have been far lower than had been anticipated for this post-recession period. (source: Economic Impact Survey, Arts Quarter).  This has to be a concern, particularly given upcoming government spending review which is anticipated to impact negatively on the arts.

A recent report on philanthropy trends by Arts & Business also clearly states that philanthropy is unlikely to fill the gap left by these inevitable cuts, although, it also suggests that there is still capacity to increase philanthropy in the arts – even if it won’t fill the gap entirely.  At the moment, 15% of the income received by arts organisations comes from private investment with over half of this coming from individuals.  A&B recommend that arts organisations need to build networks and to look at fundraising to contribute towards the sustainability of the sector – rather than simply to fill a gap or as a quick fix.

What is clear is that the sector needs to immobilise itself now, as the I Value the Arts campaign illustrates.  It is also important that arts organisations work locally, collaborating with others in their area.  Fundraising is a long term activity – any relationship takes time to build and develop and fundraising is no different. 

Arts organisations should use existing networks and contacts to build support – it is most likely that those who already know you and are familiar with your work will consider giving you support.  Look at best practice and emulate – look to those in your sector (and other sectors) to find out what is doing well and what isn’t in terms of raising income and try to think of ways you could adapt these to fit with your fundraising.  Engage with your audiences in new ways – perhaps you could use social media?

I did, however, wonder at the suggestion by A&B that fundraising can’t just fill a gap created by a lack of public funding.  It is a view that I completely agree with but I suspect a few arts organisations read this and thought:  ‘But that’s precisely what we need it for!’ 

It is highly unlikely that you can simply switch like for like.  There will be a need to scrutinise resources and make cuts but, in a sector that is already fairly lean, that might not result in much in the way of savings.  Perhaps viewing your core costs differently could help – could essential maintenance could be used to train artisans or does it have an environmental or community engagement aspect that might appeal to donors?  Perhaps you could assign an element of core costs as part of a project you are fundraising for? You will need to think about your entire programme of activity.  What could be of potential interest to a donor or sponsor?  Are there any areas which are only likely to be met through public funds?  Can you adjust your income streams accordingly? 

There needs to be a move away from knee-jerk fundraising.  There will always be times when there is an urgent need for funds but that shouldn’t be the main pattern for your fundraising.  The arts are by their very nature creative and they need to adopt this approach in their fundraising in order to ensure future sustainability and growth.

What do you think?  Are you dismayed to read that fundraising is unlikely to meet the funding gap?  Or have you already adjusted your programmes in anticipation of the funding cuts?

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