On what basis should public funding to the arts be provided?
The governing principle that declares that arts funding should be provided from the public purse can be traced to the rule in Roman law that stated: Quod omnes tangit, ab omnes approbari debet or ‘what concerns all, should be approved by all’.
This can be summed up today in the commonality of an international policy trend and defined thus: ‘equal access to the arts for all, funded by central government from the public purse, managed by arms-length agencies and determined by peer assessment’.
This Roman governance principle, recovered as an ideal by Frederick Barbarossa (c 1158), assumed that income taken by a government in the form of taxation – or obtained from some analogous ‘public’ source – would be held in stewardship for use on behalf of the citizens and that such use would benefit all citizens in tangible matters relating to their safety, security and welfare but also in those culturally rich but less evident areas which enhanced the spiritual, emotional, cultural, educational and intellectual well-being of the populace.
When a mélange of private and public ownership – with its accompanying class structure and market-driven ideology – took the place of communal occupancy and a shared responsibility for lands, property, and welfare, then, and only then, did the idea that the arts, in any holistic sense, were separate from life and somehow an almost peripheral adjunct to it, gain any currency.
Until that time painting, sculpture, ritual, dance, drama, story-telling, weaving, body-art and the raft of what we now know as ‘arts’ activities were indistinguishable from the ‘culture’ and so much a part of society that life was seen to be inseparable from those magical, ephemeral and intangible aspects that gave it its richness, it spirituality, its unique and precious nature.
Only with the advent of commercial and monetarist capitalism did the arts become a sacrifice to what Oscar Wilde later described as knowing ‘the cost of everything and the value of nothing’.
Only then did the arts take the form of a luxury item, an ‘add-on’ to living, and only then did the arts appear ‘at risk’ from both marginalisation and a form of creative collapse brought about by commercialisation.
Today we ‘know’ that the arts are essential to a civilised and peaceful evolution but this knowledge remains anathema to a ‘user pays’ ideology that states that the marketplace rules and that any activity and/or product which cannot prove its worth in the marketplace has no value and if it cannot sustain itself and earn what it spends then it should be allowed to die.
This dichotomy is what requires the arts to be provided for and sustained by the societal structure most appropriate for this purpose – the singular and most significant beneficiary of the proceeds of the arts, the representative of all of us, the government and its agencies.
A Published Theory
Survival of the Arts in a Market Driven Ideological Model.
Because the arts give so much to the people who participate the question has been asked why is the customer not required, through admission charges, to cover the full costs of participation? After all is this not the method applied to most consumer goods and services?
There are several levels on which public funding to the arts can be justified.
When relying on market demand alone there may be a shortfall in the output of arts because the benefits of the arts are far reaching beyond the audience and performers/artists. While the arts do provide a service by the advantages to the wider community are extensive.
The basis on which we provide public funding for the arts should be a strong focus for policy makers as arts in the public environment has far reaching effects beyond those seen as ‘luxury’ or ‘lifestyle’ components.
As a political tool the arts give policy makers a focus for a wide range of public concerns that can be addresses in creative and cost-effective ways. Arts advocates have a large range of published research that signifies the important role that arts play in improving student learning, in building a strong work force, in developing the creative industries, in offering a positive alternative to troubled youth and for those trapped by poverty. By making a small investment in the arts it can help strengthen the economy of a community by promoting tourism, and attracting businesses to expand local job opportunities.
The role of the arts in education is one of increasing interest to parents, politicians, educators and business owners.
Research undertaken in America by the National Assembly of State Arts Agencies showed that children who study the arts demonstrate stronger overall academic performance. Arts programs improve students’ self-confidence, built communication and problem-solving skills and encouraged young people to be creative thinkers in other academic areas.
At risk youth who became involved in arts programs showed, after perceived failure in more mainstream social service programs, that the arts programs had positive effects on their attitudes about themselves and toward learning.
Involvement in arts can improve academic performance, build new skills and increase communication skills. For at risk youth these skills can mean a world of difference and give youth a fairer chance at life.
“Young people who are involved in making something beautiful today are less likely to turn to acts of violence and destruction tomorrow .… We all need to support the arts. In doing so, we are telling America’s youth that we believe in them and value what they can be.”
Janet Reno, former U.S. attorney general
“After all, arts education is really the only way to create a more knowledgeable public and new generations of leaders that will drive this creative industry, not-for-profit and or-profit alike. Art is central to a civil society. Kids who create don’t destroy.”
Terry Semel – past chairman and co-CEO, Warner Bros. and Warner Music Group
Economic advantages
Advertising, design, information and technology, architecture, scientific research and other industries all take advantage of an arts mentality towards creative thinking and innovation. The arts challenge people to think outside the square, to take risks.
New Zealand has a great industrial history of firsts and this has been made possible by our creative way of thinking that is nurtured by our arts environment.
Another area that New Zealand excels in, in the business world, is tourism and as a bi-cultural nation our artistic culture needs to play a strong part in that market. Historic/cultural arts create businesses, encourage tourism, and supports consumer spending. Not only does the arts increase employment by directly employing artists, actors, dancers, musicians, lighting technicians etc but also by the flow on effect to the economic environment may be a factor in the employment prospects in other areas such as hospitality – hotels, restaurants, cafes and other tourist based industries.
By this input to the wider community the diverse employment opportunities are far reaching. Business recruitment focusing on skilled workers often has to take into consideration the arts and cultural life that exists within a region when looking to relocate staff or encourage workers to transfer.
By publicly funding the arts it serves the greater public. When money from the public coffers is spent on the arts it affects the greater public arena in a multitude of ways.
‘People who create in our companies – whether they be scientists, marketing experts or business strategists—benefit from exposure to the arts. People cannot create when they work and live in a culturally sterile environment … ‘
John D. On – chairman emeritus, The B F Goodrich Company
Four Case Studies
A Range of International Approaches to Publicly Funding the Arts
The definition of ‘arts’ employed covers the following disciplines:
- Community art
- Dance
- Drama
- Festivals and other mixed art forms and venu
- Film production
- Literature support
- Music
- Opera
- Visual arts (including public art) and photograph
- Museums and galleries
Where possible estimates of the cost of ‘administration of culture’ have been included. The introduction of a National Lottery in the UK has somewhat distorted the shape of funding in the arts in the UK as it has done in New Zealand.
The countries chosen as case studies are:
- Australia
- England
- Ireland
- Sweden
These countries were chosen because:
- Australia is our nearest neighbour;
- England is the country perhaps most affected by modern market ideologies;
- Ireland has, for 2 years at least, been touted as a model for NZ to follow;
- Sweden is a country of comparable resources;
Each country has both a traditional and a current public funding relationship between the arts and government, government funding, advocacy and advisory agencies, politicians and policy makers.
Data from all of these countries relative to regional and local government funding exists and is relevant. I have chosen to only include central or federal government funding as these best relate to the topic.
It is worth noting that the USA is often used as an example of a country where the principle of public funding of the arts is not strong. Less than 1% of GDP is devoted to publicly funded arts and cultural activity.
However the situation in the USA is more one of a government supporting the private sector by way of direct and indirect tax incentives and other such machinery to do what, in other countries, is done directly by governments and through government agencies.
As a result of this indirect government intervention the USA has the highest level of private sector support for the arts through charitable foundations and corporates (not including formal sponsorship agreements) of any country in the developed world.
Australia
Population 17,935,800 (1994 estimate)
GDP AS$ 499,361,200,000 (1996)
GDP per head AS$ 27,306 (1996)
Federal government consisting of the Queen (represented by Governor-General), Senate (76 members), House of Representatives (147 members)
Central/Federal Government Support Framework
Federal government responsibility for culture is the remit of the Department of Communications and the Arts, which funds the arts directly and also channels support to several arm’s length agencies, such as the Australia Council. It has responsibility for the production and funding of Australian arts internationally.
Federal government funding for culture in 1996/97 amounted to A$2,288.2 million or 37.4% of total funding for culture in Australia.
Indirect support
The total value of business sponsorship in 1996 was A$65 million.
Western Australia runs a lottery, and 2% of the proceeds are channeled to the arts by the State Department for the Arts.
Public Sector Arts Expenditure as a Percentage of Total Government Spending
Overall public funding on ‘culture’ in 1996/97 represented 2% of total government expenditure of A$176,672,000,000.
Public Sector Arts Expenditure as a Percentage of GDP
1996/97 expenditure on arts and museums represented 0.19% of GDP. The arts component represented 0.14% of GDP
Trends
Total public spending on ‘culture’ increased from A$3,051.5 million in 1994/95 to A$3,447.5 million in 1996/97, a percentage increase of 12.97%.
England
Population 48,903,000 (1995 estimate)
GDP £546,200,000,000(1996)
GDP per head £11,126(1996)
Constitutional monarchy (Great Britain and Northern Ireland);
Upper House (House of Lords): 1,198 (but typically 380); Lower House (House of Commons): 691
Central Government Support Framework for the Arts
In 1992 the Government established the UK’s first Ministry of Culture – The Department of Culture, Media and Sport, which brought together responsibility for arts, museums and galleries, film, broadcasting, press, heritage, tourism and sport.
Arm’s length agencies allocate central funds for culture – the Arts Council of England, British Screen, the British Film Institute, the Museums & Galleries Commission and the Crafts Council etc.
There are ten Regional Arts Boards and seven Area Museums Councils, which receive their funds primarily from the Arts Council and Museums & Galleries Commission respectively.
Central government support for arts and museums in 1996/97 was £421 million. £211 million of this was for arts and £210 million for museums.
The introduction of a National Lottery has had significant financial impact.
The Arts Council of England National Lottery income for arts, film and crafts in 1996/97 was £262,800,000 and for museums was £106,400,000.
Indirect Support
Business sponsorship of the arts in the UK in 1996/97 was estimated by ABSA to be £95.6 million and is increasing after a static period in the 1990s.
Public Sector Arts as a Percentage of Total Government Spending
The overall public sector spend in England is £190,721,000,000.
Public Sector Arts Expenditure as Percentage of GDP
Arts and museums expenditure of £786,930,000 in 1996/97 represents 0.14% of GDP (excluding lottery). If Lottery monies are added arts and museums expenditure rises to £1,156,130,000 or 0.21%.
Trends
1996/97 saw a small decrease in central government expenditure from 1995/96 and a more significant one for the arts from 1992/93 and 1993/94. Overall local authority revenue expenditure on the arts and museums reveals a modest increase in the first half of the 1990s followed by no growth between 1995/96 and 1997/98.
Ireland
Population 3,560,000 (1993)
GDP IR£48,244,000,000 (1997)
GDP per head IR£13,177
Independent democratic republic; House of Representatives (Dáil): 166 members; Senate: 60 members
Central Government Support Framework for the Arts (including museums, natural heritage – waterways, sites of natural beauty etc)
The main responsibility for cultural affairs rests with the Department of Arts, Heritage, Gaeltacht and the Islands. The Department’s remit covers arts and culture; heritage; broadcasting and film; and the preservation of the Irish language heritage. The arm’s length Arts Council/An Chomhairle Ealaíon is the main channel for government support for the performing arts, visual arts and architecture, literature, film, arts festivals, arts centres and community arts. Other intermediary agencies include Bord Scannán na hÉireann (Irish Film Board), the Heritage Council and Bord na Gaeilge (Irish Language Board).
The Department of Arts, Heritage, Gaeltacht and the Islands contributed the vast majority of 1997 spending on the arts and culture, totaling IR£37,980,000.
Indirect Support
The Finance Act of 1969 provides exemption for artists from income tax and surtax for earnings from original and creative work.
The ‘special’ tax position of artists was extended with the creation of Aosdána, a ‘collective’ of artists, through which up to 200 artists can receive tax-free stipends from the Arts Council for up to five years. Government also provides fiscal inducements for investment in film production.
The value of these taxes foregone by Government is significant. In 1997 it represented:
- IR£16,312,000 tax relief for investment in films
2. IR£8,100,000 Income Tax Exemption for certain artists in relation to their artistic earnings from creative works of art.
Business support for the arts totaled IR£10,200,000. Thus total indirect support for the arts and museums equaled IR£34,612,000, of which IR£24,412,000 was public money.
Public Sector Arts as a Percentage of Total Government Spending
In 1997 total government spending in Ireland was IR£11,810 million. Public sector expenditure specifically on the arts and museums at central and local level amounted to IR£44,014,500 which, expressed as a percentage of total government spending, was 0.37% (excluding tax relief).
Public Sector Arts Expenditure as Percentage of GDP
Total public revenue and capital expenditure on the arts and museums of IR£44,014,500 in 1997 was either 0.091% of GDP (excluding tax breaks) or 0.141% (if taxes foregone of IR£24,412,000 is added).
Trends
Central government expenditure on the arts and museums has grown in the 1990s, but from a low base. It is interesting to note that arts and museums spending has decreased as a percentage of total government consumption expenditure compared with 1995 data (0.37% c/w 0.43%, but has increased as a percentage of GDP (0.09% c/w 0.07%).
Notes to the data
Data was supplied by the Arts Council/An Chomhairle Ealaíon.
Sweden
Population 8,844,499(1996)
GDP SEK1,688,453,900,000 (1996)
GDP per head SEK190,904 (1996)
Constitutional monarchy with Parliament (Riksdag) with 349 members
Central Government Support Framework for the Arts
A Ministry of Culture is responsible for policymaking and financial allocations – implementation is assigned to other agencies. Within the Ministry, the arts are dealt with by a Department of Cultural Affairs.
The National Council for Cultural Affairs (Statens kulturräd) is a quasi-independent organisation through which the Government and parliament affect cultural policies. Its national responsibilities include supporting the performing arts; literature, public libraries and cultural journals; and the visual arts, museums and exhibitions. It allocates national government funds within these areas, but only to groups and institutions and not to individuals.
Other agencies include the Arts Grants Committee that awards grants to individuals in all the arts except literature (the responsibility of a separate Swedish Authors’ Fund); the Swedish Film Institute; and the Central Board of National Antiquities, responsible for the built heritage.
Central government expenditure on culture in 1996 was Swedish Krona SEK6,525,768,000.
Indirect Support
The Government coffers for film are enhanced by a levy on the box office income of cinemas and a levy on videotape rentals, which goes to the Swedish Film Institute. Swedish TV is also required to contribute to the Institute. The Swedish Parliament has recently agreed to impose a levy on imported blank recording CDs, audio and videocassettes, which will be redirected to artists collecting societies.
Business sponsorship is modest, through growing. An estimated SEK240 million was raised in 1997 for ‘culture’, up from C.SEK200 million in 1995.
Public Sector Arts as a Percentage of Total Government Spending
Total general government final consumption expenditure for 1996 was SEK443.064 million (central government SEK136,478 million and local government SEK306.586 million). Central and local/regional expenditure on ‘culture’ comprised a high SEK14.271 million.
Public Sector Arts Expenditure as Percentage of GDP
The Swedish Gross Domestic Product in 1996 was SEK1,678,111 million. Thus expenditure on arts and museums represented 0.35% of GDP.
Trends
Expenditure levels on culture in Sweden are high by any standard. However, in the first half of the 1990s, central government expenditure on culture lessened because of the difficult economic situation.
How This Relates to New Zealand.
‘The Arts Council is committed to increasing its understanding of the development of the arts by research and dialogue.
It is a strategic priority of the Arts Council to keep national and local government well informed about arts policy needs, The report this information was gathered from was commissioned to provide relevant benchmark data to Government on international levels of public expenditure on the arts.
Because of New Zealand’s unique location on the globe and our bi-cultural policy and lifestyle it is imperative to our society that we maintain a strong support for the arts and as Cathryn Robinson, the arts development Manager of Creative New Zealand said:
“A healthy arts infrastructure cannot survive on dreams, passion, commitment and creativity alone. What’s needed to support those essential ingredients is a mix of financial, organisational and artistic strength. The right mix is vital to ensure the long-term viability of our country’s professional arts.”
Bibliography & Readings
- The Basis for providing Public Funding for the Arts The NASAA Advocate
- A comparative study of levels of arts expenditure in selected countries and regions .The Arts Council of Ireland
- CNZ Future Strengths
- Why the public must fund the arts S.Thomson, Canada Council for the Arts
- The performing arts and the public purse J. O’Hagan, C. Duffy
- Public Funding of the Arts in Colorado F. Hodsoll
- The future for cultural policy in New Zealand M. Volkerling
- The Economic Benefits of Art C. Madden
- Policy Paradox D. Stone
- What is the Value of the Arts? Dr L. Johnson
- Beyond ad hocery: Defining Creative Industries T Flew
dykiegirl 