Arts Council Wales – Written Evidence (LBC0292)

All arts organisations – and many individuals – have been adversely impacted by the pandemic, some quite catastrophically. 1. The arts sector in Wales is largely made up of charities, community interest companies, social enterprises, and freelancers. Charitable organisations and individual creatives generally carry no sizeable reserves and, even when operating in normal circumstances, do not set out to make large profits. Any profit that’s made is generally re-invested back into enhancing delivery and extending the impact of arts activities.

Some of our most effective and important organisations found themselves worst affected. 2. The loss of income from the closure of theatres and venues has been very serious. But current difficulties are exacerbated for those organisations (mostly venues) who achieve a high proportion of their income from ticket sales, retail income and other secondary spend. For example, under normal circumstances we applaud organisations like Chapter, Galeri in Caernarfon and for their success in operating with a low dependency on public funding. But with around 80% of their income coming from commercial activities, otherwise stable business models crashed overnight.

3. There’s also the potential impact on associated expenditure. The Wales Millennium Centre, for example, sustains 1,200 jobs onsite and has estimated its annual economic impact in Bay to be around £70m per annum. Its eventual re-emergence from lock-down will almost certainly be as a ‘smaller’ organisation.

The cumulative loss of income is very serious, to the organisations themselves and to the economy of Wales. 4. The Arts Council of Wales provides annual grant-in-aid support of around £27m to a nation-wide network of 67 key arts organisations – the Arts Portfolio Wales (APW). These organisations alone are losing around £1.45m a week in earned and contributed income.

5. We also provide support to many organisations outside the Arts Portfolio Wales. One of the highest profile sectors is Wales’ festivals, with many usually taking place between May and August. These include Hay, Llangollen, the National Eisteddfod and Green Man. These aren’t just important cultural organisations – they’re also part of Wales’ overall visitor and tourist economy. Covid-19 has had – and is likely to continue to have – a profound impact across the creative industries. 6. As Ffilm Cymru Wales has reported, these impacts in Wales include:  the closure of all cinemas, mixed arts venues and community providers of film screenings (this includes 13 commercial sites such as Vue, Odeon and Cineworld and around 290 independent providers including mixed arts centres such as , Galerie Caernarfon, The Torch in Milford Haven and Pontio in Bangor)

 the cancellation, postponement or reimagining of film festivals – across Wales, the rest of the UK and internationally. For example, Cannes moved to an on-line only ‘virtual market’ disrupting how business takes place, whilst home-grown festivals are trialling on-line delivery, as with Cardiff Animation and Iris Festival

 significant disruption to distribution for films that have recently completed – including Euros Lyn’s “Dream Horse”, which told the story of a Valley’s community who raised a race-horse, and Mad As Birds’ film “Six Minutes to Midnight” with Eddie Izzard and Judi Dench.

But it’s not just organisations who are struggling – many individual artists and creative freelancers have suffered an immediate loss of income. 7. Freelance artists and creators are the ultimate “gig workers”, moving from project to project to find the next pay-cheque. Often, they’re doing this without the benefit of employee protection, and without any significant savings to draw on in times of crisis.

8. Most creative freelancers have had 100% of their work cancelled. They are without income and without promise of work. The scale of the impact on jobs was reflected in Oxford Economics’ report commissioned by the Creative Industries Federation, in which Wales is projected to lose 26% (15,000) of its creative jobs and see a 10% (£100 million) drop in creative industries GVA. Part-time and freelance workers continue to be denied the protections that their employed counterparts take for granted. The UK Government’s Job Retention Scheme and Self-Employed Income Support Scheme have been welcome interventions. However, many fell through the gaps between these two.

There is a differential impact on individuals that reinforces inherent inequalities. 9. The suspension of live performance and public cultural activity is one of the most comprehensive shocks to society’s sense of well-being, as well as to the economy. But we need also to recognise that public health crises aren’t equal opportunities events: the poorest, most marginalised and disabled are generally the worst affected, while the wealthy, connected and healthy are usually better able to weather the storm. 10.There’s also the potential for an adverse impact on the Welsh Language activity as we try to support two cultures in two languages from one budget. The COVID-induced reduction in social contact is a particular threat to Welsh language culture as it is very community based (eg: Eisteddfodau, choirs, bands, gigs). We need a proactive strategy to ensure that the pandemic doesn’t do disproportionate damage to this integral part of our culture.

Working with the , we reallocated money from existing budgets and created a Resilience Fund for the Arts of £7.0 million (later increased to £7.5m). 11.The Welsh Government’s grant-in-aid to the Arts Council has been the vital foundation stone on which our COVID-19 emergency response strategy has been built. In April, we ‘re-purposed’ discretionary grant-in-aid funding and money from the National Lottery. We subsequently secured a further £500,000 from a private charity, the Freelands Foundation.

We moved quickly to create a Resilience Fund to provide emergency support. 12.We supported 631 individuals with support totalling £2.475m and 119 organisations with support totalling £3.064m.

An immediate concern at this time is solvency, or the immediate cash position and cash prospects for organisations. 13.Since every form of immediate and projected income for venues has ceased, every organisation has gone dark, hoping that the best strategy is their survival for another day. Some are improvising alternative ways of promoting their activities – live streaming, digital collaboration, online readings and podcasts. Others are making their time, talent, and physical space available for immediate community needs — field hospitals, production of PPE, food production etc.

The Welsh Government has announced a Cultural Recovery Fund which it will jointly manage with the Arts Council of Wales. 14.This is a £53m fund, and the Arts Council of Wales will be responsible for distributing £27.5m of this sum. The fund is designed to help organisations stay afloat during a period of acute financial pressure due to COVID-19. We also recognise that ongoing restrictions on the resuming of activity caused by social distancing rules adds to the uncertainty. Helping to address these pressures is the central purpose of this fund. It will be especially useful in helping to replace the tapering support from the UK Government’s Job Retention Scheme. Those receiving support from this fund will be expected to sign up to the Welsh Government’s ‘Cultural Contract’. 15.The Welsh Government’s vision is of a Wales that is fair, prosperous and confident, improving the quality of life of its people in all of the country’s communities. The development of a ‘Cultural Contract’ is designed to encourage applicants to adopt new commitments that ensure that public investment is deployed with a social purpose. This will build on the Welsh Government’s existing ‘Economic Contract’ and is part of a wider strategy to find opportunities for beneficial change.

The “Cultural Contract” offers an incentive to plan for a different future. 16.Long before COVID-19 struck, the Arts Council has had a clear vision for the future: a creative Wales where the arts are central to the life and well-being of the nation – a place where our best talents are revealed, nurtured and shared, and where all communities across Wales have the opportunity to enjoy and take part in the best that our artists and arts organisations can offer. This is consistent with the Welsh Government’s Well-being and Future Generations legislation.

17.In spite of the pandemic – perhaps, even, because of it – we remain impatient with the fact that too many people are still effectively denied the opportunity to enjoy, take part, or work in the arts. If we believe that the life enhancing experiences of the arts, of imaginative expression, are crucial for a healthy and dynamic society, then they should be available to all.

18.For all its grim characteristics, we mustn’t let the current crisis divert us from our bigger goal. If the arts in Wales are to be resilient, equal and diverse we must encourage strong, entrepreneurial leadership. This means building a sector that’s imaginative and innovative; one that’s intimately embedded within the community that it serves; one that focuses on its audience and adopts its business to withstand change, whether planned or unexpected. Although the COVID-19 emergency isn’t what anyone would have wished for, the coming months will reveal the organisations with the skill, the resilience and the capacity to endure in the longer-term.

19.Our task is to ensure that what survives is a viable and vibrant nation-wide network of arts organisations, from the international to the very local – organisations which celebrate the best of Wales on the world stage, and those that work at a local, community level. But we must also be about artists and audiences – those who create and those who enjoy the fruits of that creation. At the heart of our Covid-19 recovery plan has to be a plan to bring people back together, safely and securely. 20.Vibrant and sustainable communities are about neighbourhood and place. They’re about the everyday issues of community spirit, safety, health and education – the ties that bind people and communities together. They’re also about enjoyment, well-being and inclusion – being part of the community, not apart from it. At its best, taking part in the arts actively empowers people to engage in the cultural life that surrounds them. This is what we must return to – and as quickly as we can.

It’s not just a question of how quickly venues can re-open or producers can resume making work, it’s what happens when they do. 21.We’re entering a period where a profound questioning and re-formulation of values is underway across all aspects of public life. And as these values shift and evolve, the arts mustn’t find themselves trapped between nostalgic notions of a ‘comfortable’ past and an uncertain future. If they do, they risk stumbling into the new landscape as an enfeebled version of their former selves. The sector is well aware of the risk. Braver people aren’t talking about a post-Covid-19 ‘new normal’ – ‘normal’ being neither possible nor, perhaps, what the public wants or deserves.

‘Normal’ hasn’t served us well for a while. 22.The upsurge in attention given to the lived experiences of BAME people in these past few weeks has filled our newspapers and television screens. No- one should now be unaware of the disproportionate impact of the Covid-19 virus on BAME communities and disabled people. But if our culture is the reflection of who we are, then “Black Lives Matter” and “We Shall Not Be Removed” are telling us that we still haven’t noticed that society is reinforcing discrimination and lack of equality. Entitlement to culture should not only be for the entitled.

We have an opportunity to re-set the dial. 23.We want to see a wider diversity of artists and producers making work. We want to see people from communities of all types encouraged to enjoy and take part in the arts. We need producers to think differently about what they’re producing, and for whom? And new venues, or rather new ways of using the old ones, must allow our arts buildings to show what at their best they already do – provide the social and artistic spaces where creative alchemy can take place.

Given time, audiences will find their way back to our arts buildings, although perhaps not in the same numbers. As they do, we must be sure that we have the artists who’ll bring life to our spaces with purpose and excitement. 24.For as long as social distancing remains, organisations and their staff are effectively ‘mothballed’, with artists denied the opportunity and resources to pursue their craft. If, as we hope, the new Cultural Recovery fund works, then we must look beyond ‘saving’ organisations (important though this might be). Those who receive public investment must demonstrate maximum public benefit. And in Wales that means meeting the ambitions set out in the Well-being legislation and our corporate priorities. If we want organisations to be sustainable, diverse and well-governed, now is the moment to demand it as a natural condition of public funding.

For the moment, resuming activity is the arts sectors’ main pre-occupation. 25.Organisations professional and voluntary want to rehearse, make and present work. The Welsh Government is publishing guidance on the ‘road- map’ for different parts of the cultural sector. However, social distancing requirements will remain the determining factor in how quickly this can move forward.

26.In the short-term it’s likely that audiences will want to experience their arts closer to home. From the largest to the smallest, Wales’ arts buildings are those important ‘pins on the map’ in their locality, keeping the arts alive across the length and breadth of the country. Communities benefit from having access to creative spaces where they can meet, socialise, enjoy and take part in arts activities. These spaces – theatres, arts centres, galleries, miners institutes, village halls – are often at the heart of the community.

Most of our arts buildings exist because people wanted them enough to make them happen. The question now is the extent to which they’re willing to contribute to the cost of keeping them open. 27.Arts buildings in Wales form an arterial network that sustains the ‘body creative’ that is Wales. But the arteries thicken and the lifeblood flows with less vigour if the principal organs falter and lose their strength. This is what we want to avoid. Buildings shouldn’t be seen as secondary to the work that takes place in them. This is too limited an analysis. Buildings can be important cultural agents, for both artists and the public.

28.As it happens, the distinctions between producer, curator, promoter and exhibitor will become increasingly blurred. We should welcome this. The best arts buildings have a leadership role – important in their own right, but strategically significant in terms of the wider arts development role they’d play.

29.Promoting diverse programmes of high quality professional activity, they would have the flexibility to commission and curate new work, exploit this work (through touring or co-commissioning), and provide the space, opportunities and services to help artists to develop and grow their work. 30.These would be organisations who are arts led, but audience focused, drawing people to work of high quality, creating a rapport between artist and audience. They’d play to their strengths and their specialism, but they’d also co-ordinate the development of partner ‘clusters’, geographically or according to their artform specialism. The continuing obligation to extract every penny of value from whatever public funding is available demands a high degree of collaborative joint working. Few will be able to paddle their own canoe, neither should they be encouraged to do so.

31.However, sustaining new business models will be a challenge. Although an under-developed market, sponsorship and philanthropic giving formed part of the pre-COVID income mix for many organisations. Now, with Wales- based companies having hardly any commercial presence in the FTSE 100, any hope of securing sponsorship or large-scale fundraising is likely to be a fading dream.

The immediate future is difficult to predict, but confidence in being able to re-open or resume public activity remains very fragile. 32.Even if theatres, arts centres and galleries can reopen, who will come? How is a theatre audience compatible with the social distancing principles that are likely to continue for some time to come. And how will venues maintain a sustainable business model if they can sell only 30% of their seats?

33.Return and recovery will depend in large part on the policy that the UK Government takes towards restarting the economy. A serious programme of investment to stimulate the UK out of recession would prompt a dynamic response from the arts. The alternative route, saving our way out of debt, will create a slower, more cautious environment with the risk that some organisations would become a casualty of the process.

The arts in Wales are facing a “double whammy” because of the negative impact and uncertainty being caused by both COVID-19 and Brexit. 34.The immediate impact of COVID-19 on the arts internationally, and on our international events, has been significant. With key showcase events like SXSW, Focus Wales, Edinburgh Festival and CINARS cancelled or delivered virtually, there’s an opportunity to re-think international work and the potential of hybrid models combining the digital and physical. Interesting collaborations are emerging.

35.This highlights the need for the arts to have the resources to maintain and nurture contacts through participation in international networks. Whilst much of this can be done virtually, the return of international touring and collaboration will depend on person-to-person engagement. This mustn’t be further complicated by the new Border Strategy 2025, unless barriers around visas and carnets are removed. 36.The Arts in Wales have received substantial benefit from European funding programmes. Our relationship with Europe has also helped to build networks and relationships, exchange skills and develop new markets. Our concern is that future replacement funds won’t be able to replicate a programme with 27 partner nations.

37.We have responded to the UK Parliament’s Welsh Affairs Committee’s recent enquiry as well as the Welsh Government’s consultation on the proposals for the Shared Prosperity Fund. We are also taking part in the DCMS consultations around a proposed UK replacement programme for Creative Europe. We continue to support Welsh and Scottish Governments’ devolved legitimacy to decide on participation in future European programmes, if that’s an option. However, we’d stress that our preference would be for the whole of the UK to continue to engage positively with Creative Europe and other transnational programmes.

38.We’re broadly supportive of the Welsh Government’s Wellbeing of Future Generations approach to the Shared Prosperity Fund. We agree that a central role for the cultural sector in a future regional development programme is important. We also strongly welcome the proposal to enable international connections to be a part of projects under future programmes.

We believe that a more nuanced approach is needed to the current proposals for a 2025 UK Border strategy. 39.Whilst we support the current proposals for a broad vision of an “effective border that creates prosperity and enhances security for a global UK”, we would wish to see a cultural dimension to that vision by adding “…that protects and promotes its unique cultural and bio-diversity”. We welcome the recognition that “UK’s border therefore presents significant opportunities for economic and cultural benefit” but would want to see the cultural benefits highlighted more clearly in the objectives and the outcomes.

40.We endorse the acknowledgement that there will be a need to work with the Devolved Governments on a border strategy for the whole of the UK, but we would like culture to be noted as a devolved matter alongside food safety, the protection of human, animal and plant health, and the environment.

41.It’s vital for the cultural and creative sector that there’s a seamless transition to a new border arrangement that continues to enable and encourage the freedom of movement of artists and creative workers in and out of the UK. International work has been critical in terms of income and reputation of our artists and more recently recognised as an important engine for Wales and the UK’s cultural relations (or the so-called “Soft Power”).

42.The mobility of workers is key for the international work of Wales’ and the UK’s leading artists and companies, supported by Arts Council of Wales and its international agency Wales Arts international with and on behalf of Welsh Government and in partnership with UK bodies like British Council and DiT. Touring Europe has been an essential part of many of Wales’ artists’ and arts companies’ working lives. Many earn a substantial part of their income from touring other European countries. And touring in Europe has been much less costly and easier for our arts companies than in other territories because of the removal of restrictions and barriers (visas, employment and taxes) for EU member states.

Future actions 43.Some practical actions would help ease current anxieties and help stabilise the sector:  continuity of core support – key arts receive annual revenue funding as part of the routine programmes of Government funding. The recently announced Comprehensive Spending Review raises the spectre of cuts in future public funding. It would be tragic to have fought so hard to protect the sector, only to see it undermined by systemic cuts to public funding

 three-year funding – at the moment, Welsh Government funding to the arts is available on an annual basis. Longer term financial stability is only possible if we’re able to work from funding commitments over at least a three year period

 revising the Self-Employed Income Support Scheme – ensuring that no freelance worker falls through the gaps of government support.

 ensuring that any new UK Border Strategy for 2025 recognises culture’s contribution to economic and cultural success – we would like to see a cultural dimension included in the strategic objectives to ensure UK’s continued reputation as a global cultural hub. We would recommend:

“Facilitate the Freedom of Movement of People that benefits the UK culturally and economically”

 advocating a ‘fit for purpose’ replacement for the Creative Europe fund – any UK replacement programme should: . Enable the sector to find and nurture longstanding partnerships and networks . Be an equitable and collaborative programme with partner countries . Be a long-term programme that enables long standing relationships to grow and develop in key markets . Prioritize and value multilingualism . Value transnational partnerships of more than countries. . Focus on the participation in networks funded through programmes like Creative Europe.  shaping the UK Shared Prosperity Fund to deliver a recovery focused business finance scheme, designed to stimulate business development and innovation across the arts and creative industries

 removing COVID-19 exemptions from insurance policies – this is currently a significant impediment to re-opening and resumption of activity

 maintaining and expanding the current tax reliefs for the arts and creative industries – this would encourage R&D, innovation and increase the availability of content

The achievements of the arts in Wales have been rich, innovative and deeply appreciated. 44.They should be sustained. But we also believe that whatever emerges after the pandemic must feel fresh and refocused, rather than a faded shadow of former glories. Could the darkness of this crisis, give us an opportunity to bring about lasting and systemic change? It’s possible that such change that would be good for the sector, for our values generally and, in particular, help us get to grips with the urgent need to address issues of equality, diversity and social justice in terms of who is able to enjoy and take part in the arts. This is the debate that we’re now initiating with the creative sector in Wales.

2 September 2020