How will the £1.57bn arts rescue package affect UK small businesses?

With senior figures predicting a devastation of the UK arts sector if no action was taken, the government has responded – with chancellor Rishi Sunak announcing a £1.57bn rescue package.

However, this money is unlikely to be enough to save all of the UK’s cultural businesses – indeed the Nuffield Theatre in Southampton announced on 2 July that it would close permanently after over 50 years in operation.

And other institutions have also been hit hard by the COVID-19 lockdown – the Southbank Centre, the UK’s largest arts complex, stated on 16 July that it could axe up to 400 jobs – approximately two thirds of its entire workforce – as it slashes costs to survive.

Despite the rescue package being described as “world-leading”, many commentators have pointed out it pales in comparison to the €50bn (£45bn) package announced by the German government.

In this piece, we’ll examine what we know about the rescue package so far, including what it consists of, how the money might be allocated, and how to apply.

What does the arts rescue package consist of?

What that £1.57bn actually represents is a mix of grants (which don’t need to be paid off) and loans (which do), which are intended to save thousands of UK cultural organisations – everything from nightclubs to historic palaces according to the press release.

The funding is broken down into four key categories:

• A £1.15bn “support pot for cultural organisations in England” which will be a mix of grants and loans. Specifically, £880 million will be grants, and £270 million will be loans (or repayable finance as the government calls it).
• £100 million in “targeted support” for national cultural institutions in England and the English Heritage Trust – this will presumably support organisations with either British (British Museum, British Library etc.) or National (National Theatre, National Gallery etc.) in their name, while the English Heritage Trust funding will help to ensure the continued viability of England’s historic sites.
• £120 million of “capital investment” to restart cultural infrastructure and heritage construction projects in England, this is likely to translate to rebuilding and renovating theatres, cinemas, museums and other cultural buildings.
• Finally, an extra £188 million for the UK’s devolved administrations – with Scotland getting £97million, Wales getting £59 million, and Northern Ireland getting £33 million.

The key question of course is who’s going to get the money.

How will the funding be allocated?

“Decisions on awards” (in other words, whether organisations are given funding) will be made alongside independent expert figures from the sector, and specialist bodies.

The following organisations were specifically mentioned as being involved:

• Arts Council England
• Historic England
• National Lottery Heritage Fund
• British Film Institute

Of the four, Arts Council England has the widest remit, and is therefore likely to be involved in the largest number of decisions.

In a blog on the rescue package, Arts Council England CEO Darren Henley pointed out that the extra funding would support both “bricks and mortar organisations” like theatres, museums and galleries, and organisations that do not have their own buildings such as dance companies, orchestras, and participatory arts companies.

However, he also feared that “not everything we want to save, can be saved”, and warned of tough decisions ahead.

In terms of predicting which organisations are likely to receive funding, the closest we get is the following sentence:

Reading between the lines, it seems like one factor in the decision-making process may be how many jobs would be directly or indirectly saved by the funding being applied for.

This would make sense, after all alongside safeguarding the UK’s cultural future, the government will want to save as many jobs as possible, as economically as possible.

One thing though is almost certain, it’s highly unlikely that this funding will be enough to save everyone who needs it.

Like any arts funding application, there will be winners and there will be losers, and it will be very difficult to know whether you’re likely to be accepted before you apply.

So, whether you run a cultural small business or supply one, you’ll need to think creatively about how you can survive (either with extra cash or without) and, if you possibly can, have a contingency plan.

How do I apply for funding?

We don’t know yet.

While the rescue package generated headlines around the world, crucial details like how to apply and when applications open were missing.

The government has only said that applications will open “in the coming weeks”, an unhelpfully vague term that doesn’t help the UK’s cultural businesses to plan for the future.

Based on previous funding schemes, it’s almost certain that applications will be made online and require a detailed explanation of funding requirements and what the extra funding would be used for.

If you haven’t started already, it’s time to start drawing up that strategy document and, given what has been hinted at so far, it’s a good idea to focus on how the funding would benefit not only your business but also (if applicable) your extended supply chain.

Summary

• The £1.57bn rescue package will consist of a mix of grants and loans
• Funding decisions will be made in conjunction with independent experts and cultural organisations like Arts Council England, Historic England and the British Film Institute
• It’s almost certain that this funding won’t be enough to save all of the UK’s cultural organisations
• It’s not clear what criteria these decisions will based on, but one factor might be the number of jobs that could be saved through the funding
• There is no timescale for funding applications, with the government having only stated that applications will open “in the coming weeks”