National Theatre (Hansard, 25 February 1985)

§ Mr. Clement Freud (Cambridgeshire, North-East)

When the Minister replies, I have no need for history or geography lessons. Anything he wants to tell me about the beginning of the National Theatre I can buy at any bookstall for insignificant sums of money.

I have raised the future of the National Theatre for no other reason than to get Government thinking on the National and on the subsidised theatre, and to obtain a few answers on what I consider to be important questions.

Since 1982, the funding of the National Theatre has not kept up with inflation. I shall give a few facts and figures, and shall gallop through them at some pace. From 1976, when the National Theatre moved into its new building, until 1979, the National ran into deficit. The deficits were caused by costs incurred through the delay in opening the building and through insufficient funds to run the building.

Following the appointment by the Arts Council of the Wilson committee to investigate the funding of the National Theatre, a special grant of £700,000 was given in 1979 to pay for arrears in building and maintenance costs and to provide a reserve for future renewal and maintenance. It was clearly understood that most of this money would be included in the base for future grant in aid. The National hoped that all the £700,000 would be added in the following year, 1980–81, because of high inflation in the months following the special grant, when the RPI rose 20 per cent.

If the £700,000 is included in the base year 1979–80, the National Theatre grant increase from the Arts Council from that year until the current year, 1984–85, is 44 per cent., against an increase in the RPI of 64 per cent. That is what I meant when I said that the funding of the National Theatre has not kept up with inflation.

Since the erosion in its grant, the National asked Coopers and Lybrand, a leading firm of accountants and management consultants, to look specifically at this point. It chose to take 1980–81 as its base year—the year following the special grant—which it assumed would represent the council's view on the proper base for the National Theatre's grants. The analysis showed that the increase in Arts Council grant offered was 33 per cent. and that the RPI increase 37 per cent. It showed that the increase in average earnings was 46 per cent. and that the composite inflation index was 42 per cent.

I shall deal quickly with the arguments being used against the National Theatre. It is doing insufficient to help itself through income from the private sector, especially compared with the Royal Shakespeare Company. It employs too many people, it is extravagant, it will not privatise, it does not control wages, the £7 million grant which it now gets is a significant sum and more than any other theatre gets and it must cut its coast.

I shall give the counter-arguments. On private sector income, the National Theatre aims to increase its self-earned income, apart from through its box office, through training activities, catering, programmes, publications, hires, book stalls, tours, ice creams and so on, exploitation, sponsorship and patronage. Its performance has been positive in all those areas. The publication profit this year is £215,000, which is more than the combined 148 catering profit of the Royal Opera House, the Royal Shakespeare Company and the English National Opera. Its hiring income is rising each year, and is four times that of the RSC. In the past two financial years the NT has raised more than £1 million from exploitation, sponsorship and patronage. That is 21 per cent. more than that achieved by the RSC in the same period. I mention the RSC because somehow the Government seem to have befriended it, and made enemies of the NT. The NT has raised more than £700,000 in sponsorship and patronage.

The second complaint was that the NT employs too many people. Since 1979, 40 jobs have been removed. It is said that the NT is extravagant. That word must be taken to be relative. To some people all subsidised theatre is extravagant. The theatre aims to set budgets for sets and costumes which allow the first-class directors and designers to realise their creative aims. The budgets are finite and closely controlled.

It is felt that the NT will not privatise. Where services are central to the NT's purpose, such as production workshops or wardrobe services, its thrust has been to tighten planning and control, and to improve management. Where services are peripheral, such as security, cleaning and maintenance, the NT has compared costs with those of contractors. It contracted out security in 1979, and planned to do the same two years later with cleaning. However, the Greater London council, which is a generous funder of the NT, made it clear that if it were contracted out, funds would be stopped.

It is felt that the NT does not control wages. I remind the Minister that its wage rates are now below those of the RSC, the ROH and private contractors. It is said that £7 million is a significant sum and that the NT must cut its costs. When the £2 million-plus costs are subtracted, the theatre is left with £5 million. I remind the Minister that the RSC gets £5 million, the ROH more the £12 million and the ENO nearly £7 million.

No debate on the NT has been conducted for about 100 years, and no debate should be conducted without mentioning Matthew Arnold. In 1879, after the Comedie Francaise came to London with Sarah Bernhardt, Arnold said, after a long and well-argued passage: The people will have a theatre. Make it a good one. The national theatre movement rumbled on and on. Sites were bought and sold and bombed, and when finally the south bank foundation stone was laid in its present site, the stonemason looked at it and said: This foundation stone needs refurbishing. It must have been the first time that a foundation stone had to be refurbished before it had founded anything.

I wish to remind the Minister — I know that Adjournment debates are one-on-one confrontations, whatever newspapers would have us believe—of the national theatre concept: that there should be a theatrical centre of excellence, subsidised by the state, to act as a beacon for the profession. That is what the National Theatre is about. Of course it must be cost-effective, but it must also be able to put on plays with more characters, more scenes, more costumes, more artifice and more music. All of those are expensive. Without a national theatre or a similar subsidised company, theatregoers would be fed a steady diet of one-set, eight-character plays, reducing Shakespeare to that from whence it came. Shakespeare wrote about a touring company of minstrels, all of whom play many parts. What would be attractive to 149 the commercial theatre would be a Beckettesque, Pinteresque play with one character, one dustbin and one spotlight.

The National Theatre has, rightly, got away from that. To our pride, it has staged "Coriolanus", "The Oresteia" by Aeschylus, "The Rivals" and many more productions to vitalise the theatre, to make us proud of it, and to bring foreign visitors to our theatre and our country. The National has helped tourism to become our third largest industry. Subsidised theatre has won well over half the awards that are on offer. It is our heritage.

I have raised this matter today because the Government have decided that the National must cut its costs in tune with housing benefit, Health Service expenditure and tertiary education. If the Minister were to say, "We need the £100 million or more that we give to the Arts Council to spend on those important sectors," I might argue with him, but I would understand. At least that would be an honest argument. What he is saying is that the National must trim its sails—fewer scene changes, fewer actors, fewer plays and shoddier sets. My point is that this is a far cry from the concept of using the National Theatre to invigorate our entire arts sector.

I want the Minister to acknowledge that the existence of a properly funded National Theatre has benefited the arts of the country. The monetarist approach of cash limits cannot work. It is bad enough for rural bus services and post offices, but at least in those sectors the buses that run are run properly, and the post offices that remain servce their customers decently. Trimming the spending power of a centre of excellence reduces it to pedestrianism. That is my argument. One ends with a deficient product which removes the entire reason for its existence.

There is an argument for abolishing the National Theatre, but I say that there is none for stifling it, which is what is happening at present.

The concept of the Arts Council was a splendid idea—an arm's length approach whereby the Government subsidised, and the Arts Council distributed. One suspects that the Arts Council is now no more than an instrument of Government, with no cultural view. Arm's length when there is a tourniquet between the source and the extremity does not work.

"The Glory of the Garden" is a sound principle. Let the regions flourish. The Minister will know how much and how often I have spoken to him about the need to invigorate my region—the eastern region—and he has been decent in acknowledging it. However, in "the Glory of the Garden", surely the regions must not flourish at the cost of maiming the metropolis. It is like knocking down a greenhouse so that one can get at the cuttings and the shrubbery.

The Minister for the Arts has spoken of our "flourishing" commercial theatre, but it flourishes because of the example of the subsidised theatre, just as ITV flourishes because of the decent standards set by the BBC. If we take away that excellence, we are left with mediocrity for the entire sector. We have a Minister who is an able economist, and a chairman of the Arts Council who is a monetarist. Admittedly, one has to say in his favour that he is a monetarist who believes that if one invests £250 million in the theatre, it will be cost-effective in that it lowers the PSBR, generates employment and VAT, and saves a lot of supplementary benefit.

We have, alas, a chief executive who believes in commercial sponsorship. I believe in it too. It is a small 150 and welcome trickle, but it will go on being a trickle until the Chancellor of the Exchequer changes the ground rules and makes it tax-effective for industry to sponsor the arts. It is wrong, and we have been telling him for many years now, to expert commercial sponsorship to be anything more than a trickle.

The Minister sent Sir Clive Priestley to look at the Royal Shakespeare Company, expecting a report with condemnation of irresponsible management, overmanning, and general excesses. He was wrong, and Priestley became a fan of the RSC—perhaps as great a fan as the Prime Minister became of President Reagan — and money went to the Barbican. I was delighted, as most of us were. Now, we need a Priestley to examine the National Theatre. It has nothing to fear. It has funded a study, with its money, by Coopers and Lybrand to look into National Theatre efficiency.

Last week, I asked the Minister whether he would look into the suggestion of central Government taking over the £2 million-plus costs for the maintenance of the building, as they have done in the British Museum and the National Gallery. That would be welcome. Tonight, I wish to put two questions to the Minister. First, do the Government want to stop subsidising art, thereby killing standards, destroying a sector in which Britain leads the world, with actors, directors, designers and writers? If they do, they should tell us. If they do not, they should find the cost, which is the cost of half a day's occupation of the Falklands. That is all that the National needs to raise its head and continue as a centre of excellence, not close the Cottesloe, renew contracts and look into the future One cannot run a theatre without some confidence in the future and without planning.

Secondly, what else does the National Theatre have to do before it can function as it was set up to function by an Act of Parliament? It has kept within budget. It has played to 80 per cent. capacity. It has been steadily spectacular, if occasionally wrong. But no theatre can always get it right, and I, who have missed very few productions at the National Theatre, have been steadily proud of what I have seen, even if every now and again I have deplored what it has done because I thought it failed to enthuse and to entertain. But it has always been of great quality, artistically and culturally.

The Minister must tell us whether the Government want the National. If they do, they must fund it. If they do not want it, the Minister must have the courage to kill it. But let me warn him that the commercial theatre needs the National the way that any form of art needs a standard. I rather suspect that the Government hope that the National will fade away. That it will not do, because too many of us care, and in Sir Peter Hall we have a champion who will fight his corner.

I shall forgive the Minister if he does nothing else than give us the Government's opinion on the subsidised theatre. I believe that we need it and that the whole theatre needs the excellence that costs perhaps £7 or £8 a seat but is a spectacular beacon in which the rest of the theatrical profession can take pride.

§ The Parliamentary Under-Secretary of State for the Environment (Mr. William Waldegrave)

I am grateful to the hon. Member for Cambridgeshire, North-East (Mr. Freud) for giving me the opportunity to put one or two 151 matters clearly on the record about the Government's attitude both to the National Theatre and to the subsidised arts in general.

I can answer the hon. Gentleman quite straightforwardly. He first asked whether the Government wanted to stop subsidising the arts. To that question I give a resounding reply. No, of course we do not want to stop subsidising the arts. As a subsidiary to that question he asked whether we wanted the National Theatre to fade away. It is an unlikely concept that Sir Peter Hall might fade away, as the hon. Gentleman quickly added. Again I can say a resounding no.

To add to my resounding noes, the Government have supplied the more important commodity of money over the last years. Since 1978–79, there has been an 18 per cent. real terms increase in Government funding of the arts. That is no small thing at a time when many other programmes have been squeezed in real terms, and many of them within my Department.

There is no question that within the pressing priorities of Government the arts can be wholly privileged. They cannot. Professor Peacock was asked recently by the Arts Council to look into the argument that the arts had a higher inherent inflation rate than the RPI. He found, taking one year with another, that that was not generally so and that there was no special case to be made for the arts in that argument.

We heard reference by the hon. Gentleman to the argument from macro-economics that in some way the arts may be a generator of such production that funding of the arts diminishes the PSBR. I find that argument a little eccentric. It was refuted in a letter in the Financial Times today. Assuming that one believed the complete opposite to the kind of economics that The Times used to argue when Sir William Rees-Mogg was its editor and assuming, further, that we took a wholly Keynesian view of economics, it would still be for those putting forward this line of argument to show that investment in the arts would be better as an income and employment generator than, for example, investment in the construction industry, which is more naturally put forward as a candidate for such Keynesian pump-priming of the economy. Therefore I do not believe that that is either a necessary or a particularly convincing argument in favour of subsidy of the arts. The argument is more fundamentally based upon our assessment of the nature of a civilised society.

I agree with a great deal of what was said by the hon. Member about the extent to which the National Theatre is a beacon to the commercial theatre. However, I take issue with the hon. Member over the extent to which the National Theatre has or has not been decently funded. There is a familiar argy-bargy between the Arts Council and the National Theatre about whether there has been an increase in real terms in the theatre's funding. As the hon. Member rightly said, it all turns on how the £700,000 is to be treated. I think I am persuaded by the argument of the Arts Council that since this sum of money was not provided for expenditure in a single year—indeed, only about £250,000 was spent in the base year, while the rest of it was spent in subsequent years — it cannot be considered as part of the recurrent grant. If, therefore, that sum is ignored, the National Theatre has had a real terms increase of about 12 or 13 per cent. since 1978–79.

152 The argument of the Arts Council is reasonable, but it does not lie at the heart of the matter. As the hon. Member said, the heart of the matter is the attitude adopted towards the subsidised theatre, what is now required of the National Theatre, and whether we believe that it can fulfil its fundamental role following all the pressures that have been placed upon it. I accept the hon. Member's implication that there are certain kinds of activity that it is not worth doing badly—that it might be better to cut out some activity entirely rather than do it badly: that the concept of a second-rate brain surgeon is unsatisfactory and that the concept of a badly subsidised theatre is unsatisfactory. I assure hon. Members and those outside Parliament that the Arts Council retains its arm's length relationship with the Government. It is lobbying hard in public, perhaps not with a strident voice but with the persistent and scholarly voice of its chairman, for a good deal more money than has been made available to it.

The Arts Council is not making life particularly convenient for the Government in doing so. Nevertheless, it is doing its job for the arts. The arm's length relationship still obtains. It is for the Arts Council to judge whether the level of subsidy that is available enables this great theatre, with its many triumphs behind it — to which the hon. Member paid tribute and I join him in that tribute—to do its job. We do not believe that the Arts Council has so dramatically mistaken its judgment as to require the intervention of my noble Friend to overturn that arm's length relationship and correct the allocation to the National Theatre.

What is the National Theatre supposed to do? There is a potential philosophical dispute about at least some of the comments Sir Peter Hall has made about the role of subsidy. In his diaries, from which we learned that Sir Peter quite rightly voted for my right hon. Friend the Prime Minister in 1979—which is very satisfactory to the Government—he wrote that to use sponsorship for the main house work would: not only be betraying ourselves but the rest of the subsidised theatre and the Arts Council. Private subsidy should be used to help us expand into areas we otherwise couldn't afford to be in: children's theatre, very experimental writing, etc. We should all welcome the injection of private money into those areas, but I do not understand the philosophical argument that in some way it would be wrong if private sponsorship could be found for some of the main line activities. It is difficult to understand why money extracted through the compulsion of the taxation system by means of the terror of my noble Friend the Lord Chancellor with the law and the Inland Revenue behind him is in some way good money, whereas money given voluntarily is in some way bad money. Money is money. As the Emperor Vespasian said when he put a tax on the urinals in the city of Rome, money does not smell. From wherever it comes, it is useful.

I hope that in the search for sponsorship and for money from outside, given the tremendous good will that has been generated over the years by so many of the performances that have been put on, the theatre will not limit itself in its application. It has been raising sponsorship, as the hon. Gentleman said, and that has particularly been applied to touring and outreach work and now to foyer music. But why not use all the great good will that exists to see if more can be done for the central aspects of the theatre's work?

I also agree that there is no evidence in, for example, the pay settlements, that the theatre is behaving in an 153 irresponsible way in comparison with other theatres, but that does not wholly absolve it, despite the difficulties with the GLC which is being rather mischievous in the way that it is on the one hand dangling carrots of potential money and on the other laying down conditions that make it difficult for the money to be accepted and savings to be made. It must examine every cost in the way that institutions of the utmost excellence in other fields such as universities have to do.

Although Sir Peter argues that there has been no overspending, we must remember that the savings that he 154 is now seeking are over £1 million. If he had what he says is his share of the Arts Council money — a 5 per cent. increase—that would leave him with a shortfall of some £900,000, so there must have been a coming budget crisis. We must ask the theatre, like all other institutions in the country, even those of the utmost excellence, to seek the further savings to continue that excellence and that contribution to our national life in the future.

Question put and agreed to. Adjourned accordingly at sixteen minutes past One o' clock.