The arts emergency service

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Nicola Hill reports on two lottery schemes that people would rather not have to apply for

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You could be forgiven for never having heard of the Arts Council of England’s Stabilisation and Recovery programmes. These two bureaucratically titled lottery schemes have managed to be both low-profile and highly controversial. They have caused street protests and won plaudits for their effectiveness. The recovery programme provides emergency treatment for arts organisations that have gone critical: it comes to the rescue only when a group faces insolvency within 12 months. It will fund one-off interventions to facilitate change such as staff restructuring, changes to legal constitution, investment in marketing and fundraising. It will not cover the costs of big capital items, nor pay off debts. Eligibility terms are very flexible, but based on experience, ACE says: ‘Making an application as quickly as possible, and warning us of acute financial difficulties early on will make it more likely that the organisation will be able to find a route forward.’ Applications are usually assessed within two to three weeks; a second phase of tests to see if the organisation has the capacity to change takes a further four to six weeks. This ‘stock take’ is carried out by two assessors, one an expert in the relevant arts sector and the other an insolvency practitioner. ACE will appoint a technical adviser to work with the organisation and its stakeholders to develop a short-term recovery plan. This plan assesses long-term viability, identifies key problem areas and any technical assistance needed, and, crucially, works out how much it is all going to cost. ACE then decides whether to make a financial commitment, based on a return to stability within 18 to 24 months.

If that plan comes good, a three-year business plan is drawn up, and the organisation may be eligible to join ACE’s stabilisation programme for up to five years. ACE piloted stabilisation funding in 1996 when it helped 13 organisations to develop survival strategies. The criteria cover a range of needs including business planning,

marketing, refurbishment or an overhaul of the artistic output in order to achieve a secure basis for long-term success. All groups in stabilisation are monitored closely and only receive further funding tranches against milestones achieved. Many of the biggest household names in arts have benefited from the scheme at some stage, including the Royal Shakespeare Company, the Rambert Dance company, the Philharmonia Orchestra, the Halle, English National Opera and the Birmingham Symphony Orchestra.

In an important joint effort between the Arts Councils of England and Wales, the Welsh National Opera was turned around from near insolvency to its present status as one of the UK’s busiest touring companies, through the stabilisation programme. Peter Bellingham, executive director of WNO, says that over the years rising costs and a failure to keep grant income up with inflation left the company on the point of bankruptcy with a deficit of £1.5m. WNO’s first application for stabilisation funding was rejected, but it came back with a revised plan and received an award of £4.25m: 60% from ACE and the rest from the Arts Council of Wales.
Bellingham says: ‘Once we got used to the process it proved to be very useful. It was a good balance of internal self-appraisal and external critical appraisal.’ However, he says the stabilisation process was very demanding on staff time. He was seconded from his post as marketing director to become the stabilisation coordinator, making sure the company achieved its milestones.

Not surprisingly, the process caused tensions. ‘In an organisation that has a 50-year history, there will always be some people who don’t want to change,’ Bellingham says. ‘There will always be obstacles, but they are not insurmountable.’ The company took a bullish approach to its funders, telling both arts councils that one-off injections would not be sufficient: they must commit to revenue funding, too. ‘The money has allowed us to use our fixed resources to the full.’ For example, WNO has invested half a

million to develop an education and community programme called WNO MAX. The company now gives performances across Wales rather than just in the main cities, ranging from one or two members singing at an old people’s home to a series of community concerts involving up to 800 school children. To anyone contemplating applying for recovery or stabilisation funding, Bellingham says: ‘You have to be prepared to change. If you just see it as a pot of money, it won’t work.’ The Place, a contemporary dance centre in London, had been living hand to mouth before it was accepted on to the stabilisation programme. It also had minimal infrastructure with no computer networks or even a caretaker for the building. ACE awarded £1.8m over four years. Sue Hoyle, the Place’s executive director, says: ‘It gave us an opportunity to think bigger and acquire confidence. We have become more outward focused and developed more partnerships.’ 
The money is being invested in the artistic programme and areas such as rebranding, marketing and customer care, staff training and development and IT.

On top of its stabilisation support, ACE made a capital award to the Place for refurbishment. ‘We used this time of disruption to think afresh about the future and the way we operate,’ Hoyle says. ‘We feel we own the business plan, the Arts Council isn’t policing us. They have helped us to understand the process and it has not been too onerous.’ David McNeill, communications manager at ACE, confirms this approach. ‘The stabilisation programme is very much driven by the organisation, it is not for us to impose management on them.’ Yet not all scheme participants have had such a good relationship with ACE. The Theatre Royal Stratford East received £450,000 of recovery money last year, but ACE has refused to release any more. McNeil says: ‘Stabilisation is not about bailing people out, it is about achieving long-term financial stability. The theatre has not provided us with a realistic budget, so we cannot give it any more public money.’ Philip Hedley, Stratford East’s artistic director, says: ‘We welcome the idea of examining all our procedures but we need more bridging money to keep the doors open.’ He believes the theatre faces temporary closure in the next 12 months if ACE doesn’t release more cash. ‘It is heartbreaking and the council are making us sound greedy and incompetent.’ McNeill counters: ‘Plenty of other theatres get by on far less; we would like to support this theatre but not at any cost.’ The stabilisation programme has played an important part in helping arts institutions broaden their role, particularly in terms of outreach and educational work. This inevitably produces turbulence: England’s eight regional symphony orchestras received £30m last year, some of it going on