Creative Scotland warns of risk of widespread ‘collapse’ without ‘further and faster’ action on funding crisis
Creative Scotland has warned the nation's cultural landscape is at risk of widespread "collapse" within months unless the Scottish Government goes "further and faster" to support the arts industry.
Chief executive Iain Munro called for “more urgency” to help turn around a crippling financial crisis, which he described as the most serious he had ever experienced.
Mr Munro admitted the national funding body was already having to make "very unpalatable" decisions due to record demand for financial support and the impact of escalating costs on events, festivals, venues and organisations.
Mr Munro suggested the industry was being held back because so much effort was going into “literally trying to keep the show on the road and keep the lights on”. Giving evidence at Holyrood’s culture committee on Thursday, he warned of a risk of “unintended consequences" if Creative Scotland did not get clarity on its future budgets.
He revealed the organisation did not know whether it would receive any additional funding to plug a huge gap to meet demand for long-term funding ahead of key decisions having to be taken in the autumn.
The Creative Scotland boss urged the Government to take urgent steps to raise the level of arts spending so it accounted for at least 1 per cent of overall expenditure. Analysis of the Scottish Budget has suggested it will only be around 0.56 per cent next year.
Mr Munro also told MSPs that Creative Scotland was in a "flatlined" funding position in the wake of the recent Budget announcement, despite claims from ministers that it had received a £13.2 million as part of a £15.8m “first step” towards delivering on a pledged to increase arts spending by £100m by 2028.
Mr Munro said Creative Scotland would have “ordinarily expected” to see £6.6m out of the £13.2m in its core budget settlement, with the other half effectively compensation for having to use some of its reserves to make up for an unexpected mid-year funding cut.
Mr Munro said Creative Scotland was still waiting to hear what it could spend the other £6.2m on. He said: “We’ve not had that conversation yet, so I don’t know what the thinking is, or will be.
"Our net effect overall is essentially a year-on-year, like-for-like flatlined position, before the in-year reduction was applied. The budget settlement is welcome and we absolutely acknowledge the wider extreme pressures on public finances.
"But it is in the context of ongoing, severe and high-risk challenges that the sector is currently having to face.”
First Minister Humza Yousaf promised to “more than double” arts spending in the autumn – weeks after a 10 per cent cut in Creative Scotland’s budget was revealed – by allocating at least £100m.
Mr Munro said: “The £100m announcement is, of course, welcome, but we all know that we could spend that several times over. It is not clear which organisations are going to get any of that, how much and when.
"We’d be keen to see, beyond what has been set out already, the Scottish Government go further and faster on the commitments that have been indicated and indeed on the £100m itself. Our ambition would be to see arts, culture and heritage spending increase to at least 1 per cent of overall government expenditure.
"It is an innovative sector. If we get the conditions right, we can unlock its full potential. The issue at the moment is that there is so much emphasis going into literally trying to keep the show on the road and keep the lights on.”
The Government has pledged to increase arts spending by “at least” £25m in 2025/26 – the first year new multi-year funding from Creative Scotland is meant to be in place.
It is assessing around £96m worth of long-term funding applications from 361 organisations, for a potential budget of just £40m, with final decisions due by October. Demand for “open funding” from individuals and organisations has also soared in recent months.
Mr Munro said: “Our multi-year funding process was predicated on an assumption that there would be multi-year budgets available. Clearly that is not playing out. But we will be working our way through that process.
“We will be having a dialogue with the Government on how much clarity we can get on what the £25m will potentially mean for Creative Scotland, but also whether we can go further than that. Indicative budgets would give us a planning horizon to enable us to make the most confident multi-year decisions, which we will conclude in the autumn of this year, with funding starting from April 2025.
"If nothing changes and we are still on flatline budgets, it would be the toughest environment and we would be making fundamental decisions which would in effect lead to the collapse of parts of the sector. It’s not a position any of us want to find ourselves in.
"Without clarity on the likely resources that will be available in the years ahead, we will have to make our own planning assumptions. That may lead to unintended consequences on the number of applications we're able to support and the ramifications that flow from that."
Mr Munro said Creative Scotland was seeing the knock-on impact of the “contraction” of vital parts of the arts funding landscape, including declining philanthropic giving, commercial income and local authority grants.
He said: “Our demand for funding is at the highest levels we have ever seen. The volume of applications and their value have both gone up by more than 50 per cent, but because those volumes have gone up, success rates have come down.
"We’re having to handle more unhappiness about the increasingly limited abilities we have to support people. There are still really good things happening and there is still money in the system, but there’s not enough.”
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