Minutes National Council

Date Wednesday 21st June 2017 Time 13:00 – 16:40 Location Virginia Woolf Room, Bloomsbury House, London, WC1A 2RL

Present Sir Nicholas Serota CH Chair of the Arts Council Maria Balshaw CBE National Council Member (Items 1-9) Matthew Bowcock CBE National Council Member David Bryan National Council Member Professor Jon Cook South East Area Council Chair Joe Docherty North Area Council Chair David Joseph CBE National Council Member (Items 1-6) Sheila Healy South West Area Council Chair Sir Nicholas Kenyon National Council Member Nazo Moosa National Council Member (Items 1-9) Peter Phillips Midlands Area Council Chair Alistair Spalding CBE National Council Member Rosemary Squire OBE National Council Member Veronica Wadley London Area Council Chair

Apologies

Also Darren Henley OBE Chief Executive Present: Laura Dyer Deputy Chief Executive, Places and Engagement Simon Mellor Deputy Chief Executive, Arts and Culture Richard Russell Executive Director, Chief Operating Officer Elizabeth Bushell Executive Director and Chief Financial Officer Mags Patten Executive Director, Public Policy and Communications Francis Runacres Executive Director, Enterprise & Innovation Ruth Alaile Director, Governance and Planning Jane Dawson Director, Funding Programmes Eddie de Souza Director Investment Melloney Poole Legal Consultant (Items 1-8) Tharsi Jorganathan Solicitor, Governance and Planning (Items 1-8) Jenna Birley Assistant, Governance and Planning Sarah Crown Director, Literature and Bristol (Item 11) Paul Blackmore Senior Manager, Estates and Facilities (Item 12) David Bryant Senior Governance Officer (minutes)

Action

1. 1. WELCOME AND APOLOGIES

1.1 1.1 Sir Nicholas Serota welcomed council members, Executive Board and other 1.2 officers to the meeting. 1.3 1.4 1.2 The Chair opened the meeting acknowledging that the Grenfell Tower fire had left London, the UK and the arts in a sombre mood. He expressed his profound sadness at the loss of the artist Khadija Saye who died in the incident. She was an important emerging artist as her work at the Diaspora Exhibition at the 57th Venice showed. He informed National Council members that he expected there would be a memorial and fund to mark her memory.

2. 2. DECLARATIONS OF INTEREST

2.1 The Chair outlined the Arts Council’s policy on managing conflicts of interest and loyalty, explaining that the general principle was that if a member of the public would reasonably conclude that an interest a Council member or officer has might influence the approach they take, they must declare it. He explained that if any member of either National Council or Executive Board had a financial interest or a high risk conflict of loyalty for any particular organisation for which a discussion took place, they should withdraw from the meeting at that point and take no part in the discussion or voting.

2.2 The register of interest of Council members as at 21 June was circulated at the meeting and is appended to these minutes for the record.

3. MINUTES OF THE MEETING HELD ON 30 MAY 2017

3.1 The minutes of the meeting held on 30 May 2017 were approved as a true and accurate record of the meeting.

4. MATTERS ARISING FROM THE MEETING HELD ON 30 MAY 2017

4.1 There were no matters arising from the minutes of the previous meeting not addressed elsewhere on the agenda.

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5. CHAIR AND CHIEF EXECUTIVE’S REPORT

5.1 The Chief Executive outlined the details of the new ministerial team at the Department of Culture, Media and Sport (DCMS) following the General Election. Karen Bradley remains the Secretary of State for DCMS, and John Glen was appointed Parliamentary Under Secretary of State for DCMS on 14th June, and will hold the responsibility for arts, culture, heritage, public libraries, museums, National Archives and tourism. Both the Chief Executive and Chair have had a very positive introductory meeting with the new Minister.

5.2 National Council AGREED to note the contents of the Chair and Chief Executive’s Report.

6. NATIONAL PORTFOLIO OF ORGANISATIONS 2018/19 TO 2021/22

6.1 Sir Nick Serota outlined the purpose of this agenda item. He reminded National Council that its role was to make final decisions on all National Portfolio Organisation (NPO) applications above £800,000 per annum and to note and consider whether there were any Area Council decisions for applications less than £800,000 that National Council ought to review and call in. Members were also to consider Area Council uplifts which took the total proposed funding of any organisation over the £800,000 threshold and any particular applications for under £800,000 that had been referred to National Council by any of the Area Councils.

6.2 National Council and Officers were reminded of the Arts Council’s policy on managing conflicts of interest/loyalty which is that a Council member or officer with an interest in a particular applicant or application should declare it. Where there was a financial interest such as being employed by the applicant or a high risk conflict of loyalty such as membership or former membership of the board, the interest was regarded as disqualifying and they should withdraw from the meeting and not take part in the discussion, or decision on that application.

6.3 The interests declared in relation to the National Portfolio Organisations applications are published on our website.

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6.4 It was also noted that Council members had previously declared non- disqualifying interests in artforms, and sectors as follows:

Jon Cook – Literature David Joseph – Music Nick Kenyon – Music and Education Alistair Spalding – Dance Sheila Healy – Education Joe Docherty – Education Veronica Wadley – Music Rosemary Squire – Theatre And Dance Maria Balshaw - Museums and visual arts Nick Serota – Visual Arts

6.5 The Chair set out the format of the discussion and reminded everyone of the importance of maintaining confidentiality, asking members to note that all final decisions would be embargoed until 10:30am on 27th June.

6.6 Richard Russell introduced the report which presented the proposed portfolio of “National Portfolio Organisations” for 2018-19 to 2021/22 that Executive Board was recommending to National Council. He reminded members of National Council’s role which was to: - Consider and approve the final National Portfolio budget - Consider and approved the National Equality analysis and action plan, - Make decisions on applications for more than £800,000 in any one financial year and any matters that Area Councils have referred to Council for decision - Consider the overall portfolio following area council decision to ensure it is adequately balanced.

6.7 He gave a brief overview of the process to date. This included the process for uplifts. The Executive and Area Councils had adhered strictly to the agreed criteria of awarding these in exceptional circumstances where:  Exciting but realistic ambition is shown  something clearly additional to the existing programme of work is offered  increased value to the communities the organisation works with is demonstrated  something needed or wanted by the organisation’s audiences and/or communities is offered  the organisation’s artistic or cultural programme is being developed in a meaningful and sustainable way

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 the organisation’s resilience and reducing the longer term grant dependency is strengthened.

Having regard to this criteria, uplifts were proposed for 8.4% of the portfolio.

6.8 National Portfolio Budget Members considered the revised budget proposals and agreed them. This included a £194,410 increase per annum to the provisional budget to enable the funding of two Sector Support Organisations to make a significant contribution to achieving the strategy.

6.9 Equality Analysis and Action Plan National Council members were invited to consider the Equality Analysis that had been appended to the report to support their decision making, and the equality action plan which set out the steps Arts Council England will take to address the issues identified. Members noted that each Area Council had also been presented with an equality analysis to inform their decision- making.

6.10 Members discussed the National Equality Analysis. There was a discussion about the diversity of the leadership of the proposed portfolio where it was pointed out that that leadership diversity varied significantly across the different bands. Band 1 was the most diverse, but for example none of the proposed Band 3 organisations were Black or Minority Ethnic (BME) led. Simon Mellor explained the expectations that would be placed on the different bands in terms of equality and diversity in 2018-2022. He reminded members that we would not be signing a funding agreement with an organisation with a ‘not met’ rating on Creative Case for Diversity. In addition, all band 2 and 3 organisations will be required to be rated ‘Strong’ by October 2021.

6.11 National Council members were informed that they would be provided with a report on diversity annually.

6.12 National Council endorsed and approved the Equality Analysis and Equality action plan.

6.13 Overall Portfolio/Above £800,000 applications Each Area Council Chair provided feedback from their Area Council meeting. It was noted that there had been positive and lively discussions at all the area council meetings. Area Councils had welcomed both the

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thoroughness of the process and the well thought out proposals that had been presented to them. They also acknowledged that our funding reach is now creating more diverse arts organisations, and delivering a wider volume of arts opportunities to more towns and cities.

6.14 …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… ………………………..

6.15 …………………………………………………………………………………………………………… 6.15 ……………………………………………………………………..

…………………………………………………………………………………………………………… …………………………….

[Information has been withheld here in line with the requirements of section 43(2) of the Freedom of Information Act 2000 – prejudice to commercial interests. A public authority is entitled to withhold information under this provision where disclosure of that information would be likely to prejudice the commercial interests of any persons or organisations, including the Arts Council itself.]

6.16 National Council considered and approved the South West Area Council recommendation that that up to £835,000 per annum should be set aside for visual arts in Bristol.

……………………………………………………..

[Information has been withheld here in line with the requirements of section 43(2) of the Freedom of Information Act 2000 – prejudice to commercial interests. A public authority is entitled to withhold information under this provision where disclosure of that information would be likely to prejudice the commercial interests of any persons or organisations, including the Arts Council itself.]

6.17 National Council then considered the over £800,000 applications.

6.18 The application by English National Opera (ENO) was raised.

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(Nick Kenyon declared an interest in English National Opera and left the room).

6.19 National Council concurred with the recommendation that ENO should be admitted to the National Portfolio.

(Nick Kenyon rejoined the meeting)

6.20 The application by Firstsite was discussed and National Council agreed with the recommendation that Firstsite should be admitted to the National Portfolio.

6.21 Members referred to the Appendix listing all the above £800,000 per 6.21 annum applications. Every application on this list was approved. Members who had a disqualifying interest, as set out in appendix A to these minutes, withdrew and did not participate in any discussions relating to the relevant decisions.

6.22 National Council then moved on to consider the overall portfolio and how it was balanced in terms of artform, geography and diversity. They considered the artform spread, and noted and welcomed the number of successful 6.1 museum and library applications. They also noted how the portfolio was spread across the Arts Council’s five geographical areas, acknowledging that the additional 4% of funding outside London had helped to create a more diverse mix of opportunities nationwide. They noted that they had already considered diversity as part of the equality analysis. National Council concluded that overall, the proposals and decisions by area councils added up to a coherent and balanced National Portfolio.

National Council AGREED to : a) Endorse the Equality Analysis and approved the Equality Action Plan b) Approve the revised NPO programme budget for 2017/19 to 2021/22 and to set aside up to £835,000 per annum for visual arts in Bristol. c) Approve the recommendations for the over £800,000 applications as set out in appendix A d) Amend the London Area Portfolio to reduce proposed offer to Hampstead Theatre and include Rosetta Arts Centre and Blue Elephant Theatre in the portfolio.

(David Joseph left the meeting)

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7. INVESTMENT PROCESS COMMUNICATIONS

7.1 Mags Patten presented National Council members with the proposed communications plans for announcing the National Portfolio Organisations decisions on 27th June.

7.2 National Council members were informed that a national press conference would take place on 27th June at the Leicester Curve, where the National Portfolio announcements would be made. There would also be locality based media campaigns.

7.3 National Council AGREED to note the communication plans.

8. STAGE ONE APPLICATIONS – LARGE CAPITAL GRANTS (ROUND FIVE)

8.1 Jane Dawson introduced this item which asked National Council to consider and decide on the stage one applications for large capital grants for round five of the Arts Council’s Lottery Capital programme.

8.2 Large Capital Grants is a competitive open application process, and the portal for applications opened in July 2016 and closed in October 2016. Each application was assessed against its business case for investment, timescale and delivery, the organisation’s skills and experience, and how well it met our goals.

8.3 The following interests were declared in relation to the Large Scale Capital applications, and affected members left the room for any conflicts of interest for each decision:

Maria Balshaw - As a Director of Manchester City Council until 1st June 2017, she was involved with the implementation of The Factory Matthew Bowcock - A Non-disqualifying conflict of loyalty was declared for Opera North. Matthew Bowcock is a board member, trainer and consultant for the Arts Fundraising and Philanthropy Consortium, for whom Opera North act as the grant holder. Nick Kenyon - Board member of The Sage (North Music Trust) Nick Serota - Non-disqualifying conflicts of loyalty were declared for Turner Contemporary and The Hepworth, Wakefield,

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who are both members of Plus Tate, a forum of organisations facilitated by the Tate, for whom Nick Serota was the Director until May 2017. Alistair Spalding - Jasmin Vardimon and English National Ballet are associate companies of Sadler’s Wells Rosemary Squire - A non-disqualifying conflict of loyalty was declared for English Stage Company Limited. A member of Rosemary Squire’s family had previously worked as a producer there. Simon Mellor - Previously employed as Project Director of The Factory

8.4 Members noted the comments from the Area Councils on the applications.

8.5 The Application by the Factory was considered.

(Maria Balshaw and Simon Mellor left the room).

8.6 National Council discussed the Stage One Application submitted by The Factory noting the comments from the North Area Council on the proposal.

(Simon Mellor rejoined the meeting)

(Nazo Moosa left the meeting)

8.7 National Council considered the recommended portfolio as a whole. The proposals were agreed, with members who had a disqualifying interest as set out above withdrawing and not participating in any discussions around those applications. Members acknowledged that all the recommendations met our balancing criteria, which considered the timescales involved for each project, the extent to which the projects overall will secure funding from other sources, the overall risk and the manner in which they address equality and diversity.

8.8 National Council AGREED: a) That the following stage one applicants should be invited to complete a Stage 2 application:  English National Ballet for a total of £3,000,000  Jackson’s Lane for a total of £2,269,700  Lakeland Arts for a total of £5,000,000  Manchester City Council for a total of £7,000,000  North Music Trust for a total of £1,234,735  The University of Warwick for a total of £4,200,000

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 Leicester Arts Centre Limited for a total of £4,177,802  Performances Birmingham Limited for a total of £4,500,000  Jasmin Vardimon Dance Company for a total of £3,069,279  Kent County Council for a total of £3,000,000  Cambridgeshire Music for a total of £1,000,000

b) Development grants for the following applications:  Jackson’s Lane for a total of £165,780  Lakeland Arts for a total of £374,976  Leicester Arts Centre Limited for a total of £177,802  Cambridgeshire Music for a total of £111,344

(Melloney Poole and Tharsi Jorganathan left the meeting)

9. ANNUAL REVIEW AND ACCOUNTS

Liz Bushell introduced this item which asked National Council to approve 9.1 the Arts Council’s annual review and accounts for 2016-2017.

National Council considered the Annual Report. They noted that the closure 9.2 process had once again gone smoothly and thanked members of staff, in particular the finance team, for all their work on the Accounts.

National Council AGREED to Approve the Annual Review and Accounts for 9.3 2016-2017.

10. YOUTH MUSIC FUNDING 2018-19

10.1 Richard Russell introduced this item which updated National Council on the progress of Youth Music following the Arts Council’s review of the organisation in 2014. It also asked National Council to approve the Youth Music Grant for 2018-2019.

10.2 National Council members were informed that Youth Music’s current lottery funding agreement concludes on 31st May 2018. National Council members were informed that Youth Music’s funding has reached around 75,000 children and young people every year, of which 27% were aged 0-5 and 28% were BME. 83% of them are grant recipients outside London, and 67% in the most deprived local authorities. Their stakeholder and applicant survey demonstrates a consistent level of approval for the organisation’s

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support and mission in the sector. It is proposed that Arts Council extends Youth Music’s funding at the same level to 31 May 2019, to allow sufficient time for the Arts Council to consider options for the use of strategic funds to deliver activity in 2019-22.

10.3 National Council members acknowledged that Youth Music is an external delegated distributor of lottery grants, and were satisfied that they are able 10.3 to comply with DCMS guidance.

10.4 National Council AGREED: a) A grant of £9,651,000 to Youth Music for the period 1 June 2018 – 31 May 2019 b) To note that Arts Council’s funding of Youth Music complies with the requirements of Lottery regulations and of an External Delegation Agreement.

11. EARLY YEARS ACCESS TO LITERATURE FUND: APPLICATION ASSESSMENT

11.1 Sarah Crown introduced this item which presented National Council with the details of the assessment of the solicited application from BookTrust for the award of the newly-created Early Years Access to Literature Grant for the period 1 April 2018 – 31 March 2022.

11.2 National Council were informed that BookTrust is the UK’s largest reading charity, with a mission to inspire a love of reading in children. Since 1992 it has been providing free books to babies, and by 2000 92% of Local Authorities had joined the programme, making it the world’s first national bookgifting scheme. Members were reminded that they had agreed to solicit an application from Book Trust in March 2017 for a grant award of up to £5,763,099 per annum to deliver an Early Years Access to Literature programme for the period 1 April 2018 – 31 March 2022.

11.3 National Council considered the application, and noted the assessment of the application against the Arts Council’s criteria, which showed that BookTrust had a strong breadth, depth and unparalleled reach for its universal and targeted programmes. It was also seen to have strong, realistic and achievable future plans, including proposed business partnerships which will further BookTrust’s core aims.

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11.4 National Council AGREED an award of up to £23,052,396 for the period 1 April 2018 to 31 March 2022 to BookTrust.

12. ARTS COUNCIL’S YORKSHIRE OFFICE LEASE

(Paul Blackmore joined the meeting)

12.1 Paul Blackmore introduced this item which set out the steps taken to review our property needs for the Yorkshire Office in Leeds prior to the termination of the current lease in July 2017. He informed members that Arts Council England is required to seek approval from HM Treasury through their Government Property Unit (GPU) before renewing leases, and to consider relocating into offices in surplus government space where this is available. A full analysis has been undertaken of available property in the Leeds area, and the GPU have agreed with Arts Council England’s findings that there are no suitable alternative office spaces, and have therefore allowed us to seek permission from National Council to renew the lease.

12.2 National Council also considered the report by the Qualified Surveyor and noted their conclusion that the lease under the terms proposed would be in the best interest of Arts Council England.

12.3 National Council AGREED: a) To note the contents of the independent qualified surveyor’s report. b) To consent to a new lease being entered into. c) To approve Arts Council England entering into a new lease for our Yorkshire Office for 5 years from July 2017, with a lease break in 2021, at a cost in Annual Rent of £48,822 per annum.

(Paul Blackmore left the meeting)

13. CAPITAL GRANT NOVATION

13.1 Laura Dyer introduced this item which asked National Council to approve the novation of a grant for the Birmingham Dance Hub from Birmingham Royal Ballet to Birmingham Hippodrome Theatre Trust

13.2 …………………………………………………………………………………………………………… ……………………………………………………………………………………………. National

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Council were informed that Birmingham Hippodrome Theatre Trust were the present owners of the headlease for the property, whereas Birmingham Royal Ballet owned the underlease, which only relates to the interior of the building. As some aspects of the project involve the development of the airspace above Birmingham Hippodrome, it is therefore considered expedient to provide the capital grant directly to them. This will ensure that further consents or leasehold requests will not be necessary.

[Information has been withheld here in line with the requirements of section 43(2) of the Freedom of Information Act 2000 – prejudice to commercial interests. A public authority is entitled to withhold information under this provision where disclosure of that information would be likely to prejudice the commercial interests of any persons or organisations, including the Arts Council itself.]

13.3 DCMS have also agreed to transfer £500,000 set aside for revenue in 2017/18 to fund the additional capital works. The full cost of the capital scheme will therefore be met from the funding set aside by the Treasury.

13.4 National Council AGREED: a) A grant novation of £2,500,000 from Birmingham Royal Ballet to Birmingham Hippodrome. b) A transfer of the 2017/18 revenue allocation of £500,000 to capital for Birmingham Hippodrome to support the capital development.

REPORT FROM THE PERFORMANCE AND AUDIT COMMITTEE

14. Peter Phillips introduced this item which provided National Council with an overview of the Performance and Audit Committee meeting held on 15th June 2017.

14.1 National Council noted that Arts Council England had appointed RSM as 1414.1 their new internal auditors, who had outlined their internal audit strategy for 2017-2020 at this meeting.

14.2 National Council AGREED to note the update and the Performance and 12.1 Audit Committee Annual Report.

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15. ANY OTHER BUSINESS

15.1 The Chair informed members that the application process for the soon to be 15. vacant National Council positions had closed on Monday 19th June, and a 1 sifting of applications would be undertaken in early July. t The meeting finished at 16:40

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