WORLD CITIES CULTURE FINANCE REPORT 2017 World Cities Culture Finance Report World Cities Culture Finance Report Contents Report Headlines 5 Introduction 6 Why is this report needed? 6 What is the specific focus of the report? 7 Is there a ‘best’ way to fund culture? 8 How the research was undertaken: scope, challenges and key terms 9 The art of the possible: an exploratory study 11 Comparative analysis 13 Culture-dedicated direct expenditure 13 Other public funders 22 Indirect public funding and private giving 24 New funding models 28 Recent trends 29 Future research and policy agenda 30 City Profiles Amsterdam 35 Brussels 43 Istanbul 51 London 59 Los Angeles 67 Moscow 75 New York 83 Paris 91 San Francisco 99 Seoul 108 Shanghai 116 Shenzhen 124 Stockholm 132 Sydney 140 Tokyo 148 Toronto 156 Acknowledgements and research partners 162 Special Thanks 163 Credits 164 2 3 World Cities Culture Finance Report World Cities Culture Finance Report Report Headlines Worldwide, the cultural sector is funded • In United States cities, culture by a complex mix of earned income, funding is dominated by private public funding, private sponsorship giving. Outside of the US, with the and charitable donations. Cultural exception of Tokyo, no other city has policymakers need to be resourceful and more than 19% of total funding from aware of the full ‘toolkit’ of options that private sources. can be used to help support culture in world cities. • Individuals dominate private giving to culture in the US and UK. This is the first global comparative study Corporations dominate private on how culture is financed in world giving in Asia. cities. It draws on detailed quantitative and qualitative data provided by sixteen • Indirect public funding, including members of the World Cities Culture tax breaks and fiscal incentives, is Forum. Its key findings include: growing in importance. Cities need to get better at capturing this and • Capital cities attract a large share of measuring its impact. national culture budgets because of the size and extent of their historic • New models of funding – such cultural infrastructure. as social finance and public match funding for crowdfunding • In three cities – Paris, Moscow and campaigns – are starting to appear. London – well over $1 billion of However it is too early, and they are public, culture-dedicated money is too small-scale, for their effects to spent per year. be measured. • San Francisco, New York City and • Institutional complexity in public Shanghai fund culture primarily at funding has increased in most the world city level, with almost no world cities, but this means role for national government. data is harder to capture and analyse. Policymakers also need • Over one-third of all public direct to ensure that policy is joined up culture funding is provided by local across diverse institutions and government. stakeholders. • Chinese cities are placing a greater priority on investing in newer and more commercial cultural forms, and in the creative industries in particular. New4 York Brooklyn Bridge. Photo © Alexandra Neuber, NYC& Co. 5 World Cities Culture Finance Report World Cities Culture Finance Report Introduction Introduction This report is the first global comparative full ‘toolkit’ of options that can be used What is the specific focus of and reports on initiatives aiming to 1/ For instance, the two study attempting to unravel and shed to help support culture in world cities. the report? encourage it. largest public funders of light on the complex question of how the UK’s performing arts culture is financed in world cities. It Funding for culture is a complicated We focus on two important gaps in the Once it is possible to identify and and music sector provided draws on detailed quantitative and subject. In most countries and cities, quantify both public funding and private £0.92bn in funding evidence: public funding and private in 2014 [Arts Council qualitative data provided by sixteen the cultural sector is a mixed economy: giving. Although public funding is giving, then ultimately it will be possible England (Grant in Aid and members of the World Cities Culture some organisations are wholly for generally not the biggest component of to derive a value for earned income Lottery) = £0.68bn (Arts Council England Annual Forum, covering: profit, some are publicly-owned and 1/ within the cultural sector. 2/ revenues to culture, it is almost always Report 2014/15) and the others are not-for-profit independents present, even when delivered indirectly. English local authorities • how cultural expenditure is financed and charities. These organisations rely Having data about the public funding of = £0.24bn (DCLG Local • the mechanisms through which on a combination of earned income, Authority Revenue Outturn culture is important because: Summary 2014-15)]. resources are distributed and public funding, private sponsorship and While the total turnover invested (including new financial charitable donations, with the precise • Public funding of culture is used of the sector is not widely models that are being launched and mix varying according to local context. to achieve a wide variety of public published (which would tested) be the proper comparison policy goals, usually goals that to use), the much smaller Public funding for culture is provided by would not be met in their entirety (or figure for the Gross Value It focuses primarily on two important different tiers of government, from the would be less equitably achieved) if Added of the sector gaps in the evidence: public funding and nation state down to local government, was still comfortably left to the market. It is the only form more than five times this private giving. each with their own defined scope and of funding in the cultural sector that value, at £5.4bn over powers with regards to culture. Further explicitly has to act in the public’s the same period (DCMS 2015 Creative Industries complicating the landscape, in many interest and for which the state is Why is this report needed? Economic Estimates). countries and cities public funding goes directly accountable. not just to publicly-owned organisations, Thirty-three world cities are members of but also to not-for-profits and sometimes • Knowing how much public money 2/ This is because total the World Cities Culture Forum. We aim also for-profit enterprises. is being spent, by whom and in to collect data that helps member cities revenues in culture = what ways, provides valuable A (Earned income) + reflect upon their policies and practice This complexity has so far largely management information as well as B (Public funding) + C – and, if necessary, to improve their stymied researchers, leading to an opportunities for knowledge sharing (Private giving). As the effectiveness and impact. value of all revenues are almost complete lack of published and learning. represented in the turnover research on how public authorities (in of the cultural sector (T A great deal of public and private money particular) fund culture in cities. This • State funding is often designed = A+B+C), which can be is spent on supporting culture in our report is a first contribution towards calculated in many cities to incentivise others to invest in from official government member cities, and others like them. Yet giving cities the knowledge they need culture. statistics, then earned no one really knows quite how much is to understand and assess the cultural income A = T-(B+C). spent, nor by whom – let alone where funding landscape. Private giving to culture is also an this money goes and the impact of this important focus for this research. In spending. These are serious gaps for some cities, particularly in the United policymakers. States, private giving – by individuals, trusts and foundations and companies Finding insights to fill these gaps is – is larger than state investment. In vital, particularly now. Public finances, other cities it is relatively insignificant, consumers’ disposable income, but some national governments are corporate sponsorship and the value of experimenting with tax incentives in the endowments and financial investments hope that these will encourage private are all volatile and or/under pressure in giving. This report seeks to quantify today’s world. Cultural policymakers individual and corporate philanthropy need to be resourceful and aware of the 6 7 World Cities Culture Finance Report Introduction World Cities Culture Finance Report Introduction Is there a ‘best’ way to fund over significantly) in order to secure their 3/ Ernst & Young (2006) culture? backing. However, when philanthropy The way to cultural is driven by corporate giving, or when diversity in tax policies: There are strong differences of opinion individual giving is dominated by the The Ernst & Young very wealthy, many worry that the kind of international survey on – both within and between cities and tax policies in the cultural countries – on the ‘best’ approach to culture that is produced becomes overly sector. funding culture. influenced by the world view of a small number of powerful donors. 4/ Directorate General Each city and country has its own mix of Internal Policies of funding models, strongly influenced by: There is no easy resolution to these the Union: Culture debates. Nonetheless, the critiques and Education (2006) described suggest that no one form of Financing the Arts and Culture in the European • stage of development and relative culture funding on its own is likely to Union. wealth provide a better outcome than some • the political and administrative combination of multiple forms of funding. division of responsibilities between nation state, region/province, city Because of the lack of data, the debate and local government over funding for culture tends to rely • the wider political economy of on theoretical critiques associated the country (and in particular, by with political ideology, rather than on attitudes to the market).