§ The Minister for the Arts (Mr. Richard Luce)
I met the chairman on 1 July and the Royal Shakespeare Company featured in our discussion.
§ Mr. Blair
Given that the Royal Shakespeare Company now finds itself in critical difficulties and that the Arts Council has suffered a cut in real terms in the funding that the Government have made available, what plans does the Minister have to extricate the Royal Shakespeare Company from its difficulties, or does he intend to abdicate responsibility for this great cultural institution?
§ Mr. Luce
There is no doubt about the standard of excellence of the Royal Shakespeare Company. It acquired a deficit of £1 million largely because it had a bad year last year at the Barbican theatre. The Arts Council is negotiating with the RSC about its future funding. There is one point that I should make. The Royal Opera House has reached a three-year funding agreement with the Arts Council, which should give it longer term stability. That could be a good basis upon which the Arts Council and the Royal Shakespeare Company could reach an understanding.
§ Mr. Jessel
Should we not build on our strengths? Does my right hon. Friend agree that the Royal Shakespeare 698 Company is a great national asset which attracts to our shores visitors whose spending generates employment and income in other areas, such as hotels and shops? Does not the RSC deserve our full-hearted support?
§ Mr. Luce
I agree with my hon. Friend about the important contribution that the Royal Shakespeare Company makes, not least in its tours around the country enabling people who do not usually see Shakespeare performed by the RSC to do so. We give a grant through the Arts Council of £5.2 million. As I said, the RSC acquired a deficit last year arising mainly from losses at the Barbican theatre, and that is a matter for negotiation between the RSC and the Arts Council.
§ Mr. Fisher
Does the Minister recall that the Government gave the Royal Shakespeare Company financial stability on the recommendations of their own report, the Priestley report, three years ago? The Government having failed to live up to that undertaking, the RSC is more than £500,000 short of the level that was agreed. Do the Government not understand that it is not only a cultural crime to underfund and wash their hands of the RSC, but that it makes no economic sense? Not only did the RSC play to 1.6 million people last year, but it paid back to the Treasury in VAT and national insurance contributions far more than the £5 million that it received in investment from the Arts Council.
§ Mr. Luce
The hon. Gentleman reminds me of a Dickens character called Mark Tapley who said that it was predicting the worst that kept him so cheerful. That seems to be in line with the hon. Gentleman's character.
Following the Priestley report, going back to 1983–84, the deficit was written off by the Government of the day and the RSC's baseline was increased along the lines of the Priestley recommendation. One thing that was not agreed by the then Minister for the Arts—I think that he was right—was to index-link the RSC at the expense of other clients and companies. That would have been wrong.
§ Mr. Cormack
Will my right hon. Friend give an assurance that he will not preside over the disintegration of one of our gratest national companies?