National Companies (Hansard, 5 March 1990)

§ 78. Mr. Tony Banks
To ask the Minister for the Arts whether he will discuss with the Arts Council steps to reduce the deficits of the national companies.

§ Mr. Luce
It is for the Arts Council to decide the level at which the national companies are funded. In 1990–91 they will each receive a grant increase of 11 per cent.

§ Mr. Banks
What other European country would treat its national companies as the Government treat ours? The Minister knows that the companies have been examined independently, and that the way in which they spend their grant has been found to be most efficient. Will he consider providing additional funds? Could his Ministry, for instance, fund the national centres directly rather than through the Arts Council—or will all this be stopped by the Queen of the Goths over at No. 10?

§ Mr. Luce
Clearly the hon. Gentleman did not listen to my answer. I have already told him that next year will see one of the biggest cash increases ever provided: the total increase for the four main national companies will be just under £4 million.
I also find it odd that the hon. Gentleman should suggest that copying other countries is necessarily the right answer. The key question that we must ask ourselves is, "What is the quality of these national institutions?" We must ask ourselves whether they are of the highest quality—and the answer is yes. We have every reason to be proud of them.

§ Mr. Jessel
The national companies are indeed of tremendously high quality. In view of the 11 per cent. increase that my right hon. Friend has announced, however, does not he think that they should try a little harder to live within their means?

§ Mr. Luce
My hon. Friend is right. Every institution in the artistic world must live within its means and manage i is resources carefully, given the total amount of money that it has. However, as the hon. Member for Newham, North-West (Mr. Banks) said earlier, the Arts Council is to receive a substantial increase next year—£20 million extra in cash resources—and 22 per cent. extra, in cash terms, during the next three years, together with three-year funding. That must be a sound basis on which to plan its finances.

§ Mr. Fisher
Does not the Minister realise that, even after taking into account last year's increase, the funding of all those companies will be below the rate of inflation over the past five years? That is why the accumulated deficit of the national companies comes to over £7 million. The figures that the Minister announced today will not begin to tackle that problem. The deficits will not go away. The Minister cannot run away and hide from them. If he does not pay off the deficits, it will not be just the Royal Shakespeare Company in London that will close; other companies and other theatres will close. Ten years of Tory mismanagement will leave the arts bankrupt—literally.

§ Mr. Luce
The hon. Gentleman cannot get away with that. He is again asking me directly to intervene and to undermine the arm's length policy. If a Socialist Government were ever elected, they would undermine the arm's length policy that has operated since the end of the Second World War under successive Governments. The hon. Gentleman seems to ignore the plain fact that the Arts Council is to receive a £20 million cash increase in the coming year. It is for the Arts Council to decide how to distribute that sum—not the Ministry, not my officials, not me. That is the right principle on which to operate.