Arts Funding

HL Deb 26 January 1994 vol 551 cc965-1038

3.9 p.m.

Lord Donoughue rose to call attention to the policy of Her Majesty's Government on the funding of the arts; and to move for Papers.

The noble Lord said: My Lords, it gives me great pleasure to move this debate with so many distinguished noble Lords participating. We look forward to the maiden speeches today of the noble Duke, the Duke of Saint Albans, and, for me in particular, of my noble friend Lord Menuhin, whose music has given such joy to so many millions of people over so many years.

We are not today discussing any decline in the quality of the arts in Britain but a flourishing culture which is under threat. There has never been such a range of high quality arts activities available to so many people as there is in Britain today. Surveys show that 79 per cent, attend some form of arts events; 53 per cent. participate in some form of cultural activity; and a quarter of those watching drama and opera are from the C2-D groups. So it is not just an elite activity.

The arts industry employs over half a million people; absorbs £19 billion of consumer expenditure; and £6 billion from artistic exports. That means it puts culture in our top four British overseas earners. It contributes far more to tax revenues than is spent in government support; but of course the case for public support of the arts is not concerned primarily with the bottom line of the economic balance sheet. To accept that priority would be to capitulate to the accountants' dogma of the past decade.

Greater government support for the arts is justified on the artistic case itself. The arts are the living expression of our linguistic, visual and musical heritage. It is not possible to quantify the importance of our performing arts to our society, nor the value of the national collective memory embodied in our museums and galleries. Through the arts we achieve some kind of national collective identity, and that is especially important when our politics seem today not to be achieving such consensus.

A Right-wing think-tank report recently questioned the need for any public support for the arts. It displayed little knowledge of arts development in this country this century. To take the theatre, where Britain leads the world, the fact is that our commercial and subsidised theatres have been totally interdependent for many years. Public money—central and local—has revitalised our regional theatre since the 1950s. Many theatres now thriving in private hands were rescued from collapse by public grants, and 18 of the current plays and musicals in London's commercial West End started in subsidised theatres. Actors, directors, designers, managers and technicians often learn their craft in the network of subsidised theatre across Britain.

Cameron Mackintosh, a great success, has written of how 75 of the first 100 shows with which he was connected needed public help; how "Cats", "Les Miserables" and "Miss Saigon" —to take just three—depend upon resources borrowed from the public sector, which, incidentally, is nearly the only place today where classic plays can be properly cast and produced on an appropriate scale.

Government funding has been crucial to all our arts, yet by international standards it is not generous. The last survey showed per capita support here at only £9.80, whereas Germany, France and Holland spent double that and Sweden treble. That is why they have better facilities, cheaper tickets and wider public access. Britain leads in artists, but not in supporting them.

The main problem which confronts us today, and which should concern this debate, is that our artistic progress of the past half century is imperilled by a succession of recent government decisions. We know that the recession has not helped. It has hit the arts, reducing both box office receipts and sponsorship. It is to be hoped that they will recover with the economy. But the other two sources of damage—cuts in central and local government funding—are self-inflicted and require positive changes of policy.

Centrally, the Arts Council cuts—£7 million in real cash terms this coming year, with 10 per cent. real cuts planned over the next four years—are the first ever and led the noble Lord, Lord Palumbo, whom I am delighted to see here, to call it, a black day for the arts and a national disgrace". The true disgrace of that is when it is set against a categorical promise in the 1992 Conservative election manifesto: We will maintain support for the arts". What a misleading prospectus that turned out to be. The bulk of the consequential Arts Council cuts falls on the small arts organisations which can least afford them. They suffer disproportionately, partly because of the wasteful mismanagement in Whitehall of the new British Library—the hungry cuckoo in the arts nest.

But the freeze on our national flagship companies—and freeze actually means cuts in real terms—is also serious. Let us take the English National Opera. In my view, it provides good opera at reasonable prices and has cut its costs to the bone. It faces a real cash cut of £250,000 this year, damaging its capacity to innovate and adding to its deficit.

Before leaving the Arts Council, I should state that there are also widespread worries about much more than its reduced funding. Its whole style of operations in recent years has led some to doubt its suitability to handle the lottery proceeds, and some even to question its very existence. Its policy initiatives, such as contemplating closing a dozen great regional theatres or cutting adrift two of London's fine symphony orchestras, revealed a mixture of farce and panic which the noble Lord, Lord Rix, in earlier manifestations displayed to better effect at the Whitehall Theatre.

The council's main product over the past five years has been an unstoppable flow of bureaucratic verbiage and redundant reports. It is what one normally polite observer described as: A peculiar melange of managerial waffle and political correctness". It inflicts on its clients and the regional arts boards—of one of which I am a member—endless criteria and perpetual business plans. A recent infliction that I saw was: An activity analysis done against an agreed list of outputs". Staff had to remember every minute spent on 41 different activities in the past year, including such items as advocacy, accountability, photocopying and faxing. So one of their main activities became filling up forms about activity analysis. I am all for accountability, but that is bureaucracy gone mad.

The costs of administering Britain's arts have risen disproportionately: the Department of National Heritage, from £23 million to £30 million in the past year; the Arts Council employs nearly 200 people to hand out barely £200 million; the switch from the regional associations to regional arts boards itself cost nearly £6 million, and the latter boards spend over 20 per cent. of the money given to them on administering themselves. Those three bureaucratic layers siphon off tens of millions of pounds of the already small sums which the taxpayer innocently believes are going to the arts.

Yet, despite all that irritating nonsense, it would in my view be wrong to contemplate abolishing the Arts Council, with its invaluable arm's length principle. It needs reform: good leadership, restoration of its authority, of its faith and of its independence. The council should recover the power that it has lost to its own bureaucracy—so full of the claptrap of political correctness. It should reinstate simple and plain procedures for distributing money. It should again take up the torch for the arts—uncomfortable frontier arts as well as the mainstream. That strategic task, I believe, needs only a couple of dozen top class people, committed to defending the arts and not just to protecting their own jobs.

I turn with a little more sympathy to local government. It needs stressing that local authorities are now the major support for arts activity in Britain. Their total arts spend this year is around £320 million—half as much again as the Arts Council. Local authorities provide more than 400 theatres, concert halls and arts centres. Without their support, whole areas of the country would be deprived of theatre, music and dance. Many Labour metropolitan authorities have particularly proud records—including Birmingham, Sheffield, Glasgow and Manchester—and among the cities, Northampton, Cambridge and Hull. Collectively, London, sadly without any status, actually tops the generosity list.

But that crucial local support structure is now seriously threatened by this Government's assault on local government's powers and resources. Capping and financial restrictions mean that the arts—arts support —where most funding is discretionary, are the easiest immediate victims. The damage is already apparent.

Local government arts expenditure fell 9.2 per cent. in the past year. Next year local authorities will suffer the £860 million environment cut announced in the recent Budget. At ground level we have already seen cuts in the arts budget at Milton Keynes of 51 per cent., at Camden of 32 per cent. and at Enfield of 25 per cent. Dozens of other cuts are in line. The London boroughs have seen cuts of a third—over £30 million taken from the arts since 1991. Theatres have been closed or are closing in Liverpool, Brent, Basildon, Stoke-on-Trent, Glamorgan, Rochdale, Hounslow and Wythenshawe. They are queueing up. Half the local authority museums in the South East face budget cuts, consequential redundancies and shorter opening hours. That is the damage on the ground which has been caused directly through cuts in local government support.

Support for the arts through the education system is also under threat. I need not remind your Lordships that within the new national curriculum no arts subject is compulsory after the age of 14. Dance is subsumed within physical education and so at secondary level need not be taken seriously at all. Under the switch to local management schools, the local education authorities are severely restricted in their power to supply arts services to grant-maintained schools. Furthermore, the opted-out schools are cutting arts services because alone they cannot afford them. Evidence accumulates of cuts in arts provision for schools.

Schools nourish the roots of tomorrow's arts and therefore we are damaging tomorrow by the decisions that we make today. In drama and dance, specialist teaching posts are disappearing rapidly, and 60 per cent. of students cannot afford to take up the places offered to them because the number of full grants has halved in the past four years.

As regards music, peripatetic music services are being dismembered; for example, in Brent, Coventry, Glamorgan, Newcastle and Manchester. In Barnet, 43 teachers from its award-winning music team have been sacked. The threat to our local arts fabric is appalling.

I do not have time to mention a number of other important aspects; for instance, the damage caused to the film industry as a result of government neglect and the closure of Elstree, nor the vital but vulnerable support role of the BBC, which spends £230 million per annum—more than the Arts Council—on arts patronage. As for sponsorship, though valuable, it can never be a substitute for public funding. In no major arts country is that the case. The lottery seems destined to replace and not add to public arts support—just a fig leaf to disguise savage cuts elsewhere. It will provide for new buildings at a time when funds to maintain them are being slashed.

The post-war renaissance of British arts was founded on public funding in co-operation with the private sector. It would be a tragedy if it were terminated by reductions in those funds or if lottery and Millennium funds were wasted because there was no clarity or vision on how to spend them.

There is an alternative approach which this side has put forward based on more coherent funding. We need more generous public support—through a reformed Arts Council, through education and especially through local government, where funding could be made a statutory obligation, qualifying for central revenue grant support. We need more consistency of policy than could be provided by eight changes of Arts Minister in the past 14 years. Above all, we need a change of philosophy from the top—to view our culture as a coherent whole and to support it. For too long we have been lectured on the need for value for money from the arts. It is time now to hear about more money for the arts to support our great cultural values.

My Lords, I beg to move for Papers.

3.26 p.m.

Lord Crickhowell

My Lords, I am grateful to the noble Lord, Lord Donoughue, for raising this important topic, not least because it has provided the opportunity for the noble Lord, Lord Menuhin, and my noble friend the Duke of Saint Albans to deliver their maiden speeches. We greatly look forward to hearing them. It also gives me the opportunity to welcome the appointment of my noble friend Lord Gowrie as Chairman of the new Arts Council of England. No one is better qualified for the post and no one is more likely to tackle with realism and determination the manifest problems which he will inherit from the predecessor body.

It implies no criticism of my noble friend if I repeat the view which I have previously expressed in this Chamber; that it is a damaging and unfortunate anachronism that the chairmen of the three arts councils are unpaid. I ask my noble friend the Minister to confirm a report that I have heard that that absurd situation is to be remedied.

The Government have been strongly criticised for cutting the grant to the English Arts Council—and in particularly trenchant terms by the noble Lord, Lord Palumbo. The Art newspaper offered a more balanced and fair view when it pointed out that the Secretary of State had protected the arts from the much more substantial cuts which had fallen on other departments. However, I feel bound to say that I share many of the concerns expressed by the noble Lord, Lord Donoughue. While there is nothing inherently wrong about a one-off and exceptional cut in Arts Council grants, there are serious grounds for worry about the present situation.

In voicing those anxieties, I am being completely consistent with what I said and did when I was a Member of the Government. In 1987 I sent a minute to the Prime Minister. I stated that this is an area of public spending where the scrimping of a few million pounds may cause immense damage but where a modest additional expenditure could provide totally disproportionate benefits. I argued that there is a need for greater recognition within government that the arts are important in themselves, that they are major job providers and that much political credit is to be gained and lost dependent on whether we pursue consistent and realistic policies. All that remains true today.

I emphasise the need for consistent policies. Companies which have to plan programmes and must book performers and venues three or four years ahead cannot easily adjust to sudden cuts.

The significant increase in arts funding obtained by Richard Luce and David Mellor encouraged me to believe that the Government were beginning to put in place the kind of arts policy for which I had long argued and which in Wales I had pursued. There I gave vigorous support to arts bodies and found the funds to build the magnificent new galleries of the National Museum of Wales because I thought that was what a civilized state should do and because I believed that the provision of arts facilities was an essential contributor to the process of social and economic rejuvenation. David Hunt has pursued similar policies and the present Secretary of State is carrying on the tradition with an increase in Welsh arts funding which compares favourably with what has been provided for England and Scotland.

My hopes have been dashed not just because of the problems of the economy but because of one factor referred to by the noble Lord, Lord Donoughue; namely, that successive Arts Ministers have been landed with the responsibility for the British Library. In my 1987 minute to the Prime Minister, I begged her to separate completely the responsibility for and financing of the arts and the library. She acknowledged that the library caused particular difficulties and pressures on the arts programme and disproportionate effects on the rest of our support for the arts. Disproportionate effects; my Lords, I should say so. This year an additional 46 per cent.—£16.5 million—has been spent on the library. It is absurd that that has been allowed to happen. The library is not an arts project.

I welcome the Welsh increase, but the arts are a seamless web. For example, the WNO is not just a Welsh company but the principal provider of touring opera in England. It receives three-fifths of its funding from the Arts Council of England. Like the other opera companies, it faces serious problems: a combination of a reduced Arts Council grant, fewer ticket sales and a reduction in sponsorship. It has spoken already of plans to cut touring weeks and other painful measures. The opera companies are faced with a vicious circle. They are forced to cut new productions which are substituted by revivals. Audiences decline for productions which have been seen too often. The ENO summed up a case which applies equally to other arts companies: ENO's future depends upon its ability to stage new productions; opera which excites, interests and attracts audiences. The company must also remain at the creative forefront of operatic life to attract the most talented singers, conductors and producers, which means further investment in exciting new work. For the major companies, the position has been rendered much worse by a change in sponsorship practice triggered by the recession. Feeling that they can afford less, sponsors have switched to smaller and, in particular, local community projects. In many ways that new interest by companies is welcome, but there remains the need for business to sponsor productions which cannot otherwise be mounted without contributions of £100,000 or more. I hope that the Government will look urgently at new ways of encouraging a higher degree of sponsorship. The Business Sponsorship Incentive Scheme needs to be examined afresh.

At community level, the arts have depended on the backing of enlightened local government. Local government arts funding is now under severe pressure and is being cut back. The work of artists in schools is suffering because of the change to local management. It is not that that is not good, but art companies and artists find it difficult to market their services to individual schools. Many local authorities have been making peripatetic music teachers redundant. Local authority reorganisation provides another potential threat to those major arts facilities which have been funded at county level. In Wales, Theatre Clwyd is a good example.

Many of those problems are capable of solution but they will need sensitive handling and positive leadership by the Government and regional arts boards.

For the future, much hope is invested in the national lottery and the Millennium Fund to provide capital resources. It is intended to direct the lottery money solely into capital funding, but I hope that we shall not be too rigid in that approach. If you build a new theatre, you need not just bricks and mortar; you must also cover the cost of managing the project and the start-up costs before income begins to flow. It is also not much good building new homes for the arts if the companies which are to occupy them die from lack of revenue or from an inability to create new productions.

We are immensely rich in artistic talent as a nation and in the strength and diversity of our national collections, not least because of the tremendous developments of the past 20 years, for which the Government are entitled to take at least some of the credit. Now, in the face of serious threats, we must protect that rich inheritance and direct our resources to the maintenance of quality and the encouragement of creativity.

3.35 p.m.

Lord Thomson of Monifieth

My Lords, from these Benches we support strongly the case made by the noble Lord, Lord Donoughue, as regards the cuts in the funding of the arts, and in particular as regards the £3.3 million cut to the Arts Council. I believe that, in cash terms, that is the first cut ever in the history of the Arts Council. Those cuts apply only within England, but, as has been said by the noble Lord, Lord Crickhowell, the arts within the United Kingdom are a seamless web, and there are similar anxieties in Scotland and Wales.

I should declare an interest as a recently retired member of the board of English National Opera. I mention the case of English National Opera as typical of the plight of national companies funded by the Arts Council. Its grant is frozen which, even with the present blessedly low rate of inflation, means for English National Opera a cut in real cash terms of about £350,000.

The ENO is the very reverse of elitist. Over the years it has introduced millions of people to opera. I am one of them. The ENO does valuable educational work to give young people a love of opera. It is a national seedbed for developing the talents of singers, conductors, designers and composers. It has been rigorous in keeping down its domestic costs and is better than average at attracting sponsorship. But its reward is a substantial cut in real terms in an already inadequate grant.

The inevitable consequences of that are fewer new productions, longer runs of familiar revivals, at higher ticket prices, with smaller audiences. As the noble Lord, Lord Donoughue, said, in purely economic terms, the Government's approach to this matter seems to be myopic. The noble Lord, Lord Crickhowell, talked about the folly of the scrimping of a few million pounds. Many studies show that the saving in public expenditure is small and the arts are variously estimated to repay two or three times over the financial support given to them by the Government.

I had an evening of sheer pleasure recently at the National Theatre watching "The Madness of George III". As I listened to the babble of different tongues in the concourse and at the bars, I could hear the foreign exchange rattling in the cash registers. Overseas sales and expenditure by foreign visitors to the UK are estimated to be about £6 billion per year. Those are the realities behind the rather mean savings which are proposed.

In their approach to the last general election, the Liberal Democrats made a major recommendation for a single ministry of arts and communications. We should be happy about the birth of the Department of National Heritage but I must express a certain sense of disappointment in some aspects of its work; in particular, its approach to its relationship with the Arts Council. There is also one other aspect that I wish to mention before I conclude my speech.

The history of the Arts Council under the new department has been a sorry tale. I am sure that we all wish the noble Earl, Lord Gowrie, well as the new chairman. He is particularly well qualified. I hope that he will be able to reverse that cut in funds by the next financial year and prevent the overall £10 million cut which is forecast at present.

I recall the noble Earl, Lord Gowrie, when he was Minister for the Arts in your Lordships' House in 1985 saying: I have constantly made it clear to my colleagues how important I think is the maintenance of the central subsidised core of arts funding". That is the key to the matter, and we wish him well in his efforts to achieve a rather different approach.

We cannot be very happy either about the approach of the DNH to its stewardship of that other source of funds for the arts—that is, broadcasting—since it took over from the Home Office. The BBC and independent television are perhaps the major influence on the cultural life of the country. But as regards ITV, the Department of National Heritage has apparently handed over the leadership to the DTI and the President of the Board of Trade. The latter seems to feel that an orgy of mergers will provide miraculous access to some global market-place for programmes. I am all in favour of selling as many programmes as possible abroad, but I think that the President of the Board of Trade is over-simplistic in his approach. In any case, the commercial half of British broadcasting should be something more than a market-place. The Department of National Heritage is supposed to be the guarantor of quality in broadcasting. It really should not allow the DTI to get into the driving seat.

In the past, great ITV managing directors like Paul Fox and David Plowright used to sit round the table and talk programmes. Now their successors sit looking over their shoulders at each other as potential predators and are compelled to concentrate on ratings, share prices and advertising percentages. Of course, commercial TV companies ought to make profits as well as programmes, but the Broadcasting Act has got the balance badly wrong. It is the responsibility of the Department of National Heritage to try as far as it can to correct the situation.

Much now depends on Channel 4 and the BBC and there, fortunately, hope remains, as those of us know who will manage to get home tonight in time to see the next episode of "Middlemarch". In 1993 the BBC's total investment in the arts will be over £370 million. As the noble Lord, Lord Donoughue, said, that is considerably more than the total Arts Council budget. The Select Committee on the National Heritage in another place was absolutely right when it said: The BBC fulfils an indispensable function by its role as a patron of the arts. These are tremendous achievements which must not be thrown away". I hope that the Government, who have done so much to damage the kind of contribution that ITV can make to the arts, will heed those words and will do better for the BBC.

3.41 p.m.

Lord Menuhin

My Lords, the cheeky taxi driver who refused to take me from Portland Place to my home in Highgate Village, saying that it was too far and that it was lunch time, added insult to injury when he shouted after me as I walked away, "Has anyone ever told you how much shorter you look off stage?" That cheeky fellow would have been more than vindicated to observe me here today, perceptibly further diminished even on-stage—as I must appear to the serried ranks above me —and, as befits the humility of this "maiden" of 77 years, an itinerant musician who has fiddled his way though life.

What could so alien a character offer in return for this honour? Perhaps, that long and concentrated discipline demanded by music which harnesses a player to a basic rhythm that at once supports and governs him—giving him a wider view—a wider sense of the myriad fluctuating pulses of all speeds which propel mankind along its tortuous course. Perhaps also a sense of the span of man's works. Might it be the intuitive counterpart of the learned historian's grasp of human destiny?

Within this Chamber is a remarkable human organism which has bridged some five centuries precisely because its concerns are not chained to the immediate or the transient, but are rather guided by the longer spans of succeeding lifetimes. I am sometimes saddened that wider sections of our population are not inclined to hold the House of Lords in the esteem that it so richly deserves; nor to consider it in its very contemporary and essential role in today's ever more confrontational and most dangerous world.

This House has the talents, the abilities and the opportunities to explore in depth basic causes. It does not have to be distracted by symptoms, by immediate crises, by the dissatisfactions, the discontents and the accusations with which the other place must daily battle. But the topics I would suggest, although apparently abstract, are none the less of supreme urgency.

In attempting to formulate whole truths, it may be possible to reduce the area in which two separate half-truths do battle. For example, let us take "Culture versus Economy". I believe that I am not infringing the maiden's non-controversial strictures when I suggest that hardly one noble Lord here present would tolerate digging up our beautiful parks, or our cemeteries, where nature and man perpetuate the cycle of life and death, merely to spur real estate values and housing markets to new yields. By the same token, perhaps I may plead that good music, too, feeds those very same intangible tangibles which enable us to breath and to dream. For man acts and behaves according to his visions, be they ideals or simply ambitions. It is those dreams which shape our lives—too often twisted into nightmares by hideous uncertainties and fears.

Now, let us consider a great orchestra, the very embodiment of humanity's need to express and communicate its emotions and its thoughts. In it some 100 men and women are dedicated to a most exacting common purpose—the making of beautiful music. They bring out from within that image of perfection in sound, rhythm, melody and harmony which translate the mysteries, secrets and the promise of burgeoning seeds into a language that we can all understand. Whenever I work with a great orchestra, be it the Royal Philharmonic, the Hallé or any of the other first-rate groups of musicians here and all over the world, I am deeply moved by the contemplation of so unique a human company. How could anyone consider reducing, on false premises, such essential and inspiring examples of human achievement?

That leads me to a plea for both the social recognition and the financial reward of the teaching profession. It is teachers, musical or other, who are called upon to fulfil the greatest and most important task of society—to instil in our young not only learning but character and, may I add, compassion, courtesy and creativity in a society wherein the lack of those basic qualities can only encourage crime. I should like to suggest that the forming of character precede the study of texts, for how often are our minds led to the shocking, the terrifying and the bewildering—all of these symptoms, the evidence of a growing malaise—rather than to their basic underlying causes?

Applying the same principle, I would urge that such funds as may come from the lottery should go not only to the visible fruits which we all eat but also to the basic roots of the plant. For example, the arts could not exist without crafts and crafts could not exist without schools and the people who produce these and other projects which aim—and this is just one of my interests—to channel the wild energies which are now rampant in certain classrooms into better purposes, partly by music and singing.

It seems to me that this House is the ideal assembly of men and women to formulate a platform totally divorced from party lines, a platform which would reflect a profound analysis of causes and would suggest approaches affecting the future of the peoples of these islands, and indeed of the world, for their environment—cultural, physical and spiritual—is already ours and everyone's responsibility.

Such a platform would deepen the understanding of many other contemporary situations and dilemmas. I feel that we must all try to fathom the processes which interact between apparently disparate conditions—in counterbalance and tension as with gravity or the magnetic forces which both attract and repel, and which, when even only partly understood, might lead to a greater consensus of public opinion, a coherence instead of the inexorable process of souring which, as curds and whey, can only separate.

Consider the inherent dangers in democracy, in which unbridled freedom may well lead to chaos. Music is the one art which can create order out of chaos—as does the gift of life to matter—for music creates a living, pulsating work out of random aural vibrations. This principle, applicable to society, even to sound, has actually been demonstrated by leaving children alone with a host of varied musical instruments and the injunction to listen, thus transforming noise not only into sound but into a message. Gradually one or another will find a rhythm, a melody, better organised, more expressive, which will attract attention and imitation.

Take chaos versus dictatorship—the examples are only too close, too present. Take the issue of the free market with its release of dynamic energies, yet entailing untold suffering and sacrifice for all peoples including our own, or the relationship of culture to crime. We know about that from Hitler's Germany. Study the advantages of the prophylactic versus the merely therapeutic; or the confrontation between states and cultures and between many more such dualities which I must spare you today. But, to take only the latter—states and cultures——we are witnessing the proliferation of states and the extinction of cultures. In other words there are more national anthems—often commissioned of Englishmen with, no doubt, overtones of Empire—and less music. There are more bombs and fewer songs. What we actually need are fewer sovereign states and more autonomous cultures. It is time that the great trees in the centre of each cultured garden were tended and determinedly protected rather than that high, harsh walls be allowed to throttle the garden. I would allow the voices of cultures the rights of initiative and veto against proposed legislation of joined states in the same way as the House of Lords, a cultural institution, possesses similar rights with respect to the House of Commons.

May I be allowed to plead for one other among many issues which, to your relief, I will ignore today? I believe the issue is quite non-controversial for it is only a consideration of economy rather than of policy which inhibits our decision to rejoin the world's cultures assembled within UNESCO. Directly after the war, in 1945, this noble concept was born right here in London after a long gestation and against the backdrop of those tragic war years. Its first Secretary-General was none other than our own Julian Huxley, the great biologist. Conceived as a non-political assembly, it was soon politicised by the United States and the USSR, yet it remains an inspiration to the world, with a first-class Secretary-General and employing thousands of highly educated, dedicated people. If we want to play a role in the building of a somewhat better world, it is imperative that we play it not only on a European but on a world stage. No doubt we are waiting for the American lead, but do not noble Lords agree that our voices unanimous might urge an independent initiative? Perhaps in due course I could move one or two resolutions.

How I wish that this great House might succeed in extending those virtues of conduct which have proven their worth within these walls and well beyond over the centuries. Perhaps this prayer I have voiced would be in a goodly manner achieved by the platform I suggest: a platform which would be continually improved, refined, revised and discussed in every pub, school, club and, above all, in the media. In turn, the echoes might bring about a more informed public opinion and might serve to guide our political platforms as well.

As Plato says, Music is a moral law. It gives wings to the mind, soul to the universe, flight to the imagination, charm to sadness, and life to everything". I know I have taken my time and wish to express my gratitude to my fellow Lords, particularly to the noble Lord, Lord Donoughue, for calling this debate and for his wonderful words, thereby legitimising my one and only maiden speech—in one way a form of wedding. Perhaps the Right Reverend Lords Spiritual will bless it.

3.55 p.m.

Baroness Birk

My Lords, it is a great honour for me fulsomely to congratulate the noble Lord, Lord Menuhin, on behalf of the whole House. I believe we all agree that his speech was quite outstanding in its depth, breadth, substance and in its brilliant presentation. We are all grateful to the noble Lord and we hope to hear him speak on many occasions in the future.

I am happy that when we hold debates on the arts there are no fights across the Chamber. We all seem to be on the same side and, indeed, over the years that I have spoken in arts debates many of the same speakers have made speeches. Again and again we press hard for the arts.

One of the indices of the quality of a society is the role of the arts in the social and personal development of the individual. Therefore aesthetic cultivation is a central factor in education. Yet the 1988 education Act, mentioned by my noble friend Lord Donoughue, only included music and the visual arts as part of the arts curriculum. During the passage of that Bill I moved an amendment from these Benches which sought to replace the words "music and art" with the phrase "the arts". That term would have included dance and drama in the arts. Drama is the fastest growing subject among those who take examinations beyond the age of 16. It deserves something better than to be treated as a minor branch of literature. However, that is what has happened.

We need to devote more effort to making dance part of physical education. The decision that has been taken on dance would be laughable if it were not so sad. I believe that I moved the amendment to which I have already referred at a late hour of the night. Nevertheless it was only lost by two votes. It was an all-party amendment and the support we received from the Benches opposite was reflected in the narrowness of the defeat. Since then the Government have laid statutory orders which have resulted in even music and the visual arts becoming optional subjects for children at the age of 14 while dance does not have to be studied at all at secondary level.

Experiencing the arts in any of their forms whether as a viewer, listener or participant is an essential humanising experience. Introducing youngsters to the many manifestations of the arts will create not only an audience now, but will also encourage future propagators of the arts to bring to bear the kind of persuasion and pressure that is needed to force administrations to give the arts the priority they merit. Generally, I think it is acknowledged —a number of Tories have told me this—that on the whole Labour administrations have done more for the arts than other administrations, but they have still not gone far enough.

I do not believe that any government have really dealt with the arts as seriously and as positively as they should. I remember that when I was a Minister at the DoE during the last Labour administration I not only had to fight the Tories on this issue, but often had to argue—and was frequently on the losing side—with my own fellow Ministers in order to get money for work and experience that touched on the arts. Although my post did not cover the arts—my noble friend Lord Donaldson was arts Minister—we worked very closely together and pressed very hard for funding.

It is really a question of a general attitude across all administrations. That is not good enough if we are to consider ourselves a civilised country. All administrations put the arts very low down the pecking order. Although individual Ministers work very hard and do the best that they can to get money out of their government, the job is often regarded as very low down the pecking order of Ministers. Ministers often admit that they would rather have a post which seemed to be more serious than the arts. Until we get rid of that attitude and the arts hold their place and are supported at a very much higher level it is difficult to see how the position will alter.

My noble friend Lord Donoughue mentioned the importance of local authorities. The local authorities' role in the arts is of the greatest importance because they are the largest donors to theatres—which are my great love. However, it is no good saying that they should give more money because they just do not have it. Although I agree that funding of theatres should be a statutory requirement, how can authorities obey such a requirement when their resources are cut and they are capped? It is impossible for local authorities to do the job that they would like to do.

That means that theatres are often in a parlous state. Until a few years ago sponsorship was very good. Now businesses are finding it difficult to give large sums. At the Regent's Park Open Air Theatre, of which I am a director, we find that small amounts are being given, but large sponsors are pulling out. They say that one of the reasons for that is that if the Government do not come in at a higher level they do not see how they can do so themselves.

4.3 p.m.

Lord Brabazon of Tara

My Lords, I am most grateful for the opportunity that the noble Lord, Lord Donoughue, has given us this afternoon to debate the funding of the arts. Perhaps I may say what an enormous privilege it has been for me to hear the maiden speech of the noble Lord, Lord Menuhin.

I would venture to suggest that no debate on this subject or on the Government's policy towards it would be complete without a mention of the Foundation for Sport and the Arts. Noble Lords who followed the progress of the lottery Bill last summer will, I hope, know that my interest in that organisation is as deputy chairman of the trustees of the foundation. I have been privileged to hold that post for just over a year now.

Unfortunately, a number of noble Lords have come up to me today and asked: "What are you doing speaking in this debate? I didn't know that you knew anything about the arts at all". I am learning all the time, but I am glad to be able to tell your Lordships that my co-trustees include Tim Rice, as chairman, the noble Lord, Lord Attenborough, Dame Janet Baker and Mr. Richard Eyre, to name but a few who have considerably more knowledge of the arts world than I have. I suspect that they have forgotten more about the arts than I shall ever know.

The foundation came into being in July 1991. It is greatly to the credit of the Government that they recognised at that time the great potential of an organisation such as the foundation and that they played such a critical role in its creation. Every year more than £20 million finds its way from the foundation to numerous arts organisations across the country. The 2½ per cent. reduction in football pool betting duty in the 1991 Budget is one of the two central pillars in the funding of the foundation. That amount of about £20 million is matched by a sum double that contributed by the football pools punter—the clients of Littlewoods, 'Vernons and Zetters—making some £60 million a year in total. By statute, two-thirds of that sum goes to sport and one-third to the arts. Therefore, in some two-and-a-half years approximately £150 million has gone to thousands of deserving causes in both sport and the arts with grants ranging from just a few hundred pounds to more than £2 million.

As trustees we try to target as much of our money as possible to projects which reach all sections of the community, the grass roots and, of special concern to us, the young and disadvantaged. I therefore hope and believe that it is of great importance to the arts world that the foundation continues its work. The reduction in pools betting duty is guaranteed until 1995 and I hope that the Government will soon announce—perhaps even tonight—a continuation of that reduction which will allow us to continue.

Time does not allow me to mention more than a few of the grants that we have made in the past year, but I should like to give your Lordships a flavour of what we do with one or two examples. We gave £438,000 to the Halle Orchestra in Manchester; £500,000 to the National Film and Television School; and £250,000 to the Royal Lyceum Theatre Company in Edinburgh. At the other end of the scale, perhaps I may give just three examples: £300 to the Garlieston and District Pipe Band in Wigtownshire; £500 to the Perth Jazz Extravaganza; and £500 to the Kennedy School of Irish Dancing in Belfast. I must admit that I find some of those very small grants the most enjoyable to distribute because they bring so much to so many people in particular interests. I do not believe that there is any area of the United Kingdom which has not now benefited in some way from funding from the foundation.

The debate allows me to make two general points on the foundation's position in relation to other bodies with a role in funding the arts in this country. The first is the national lottery. Obviously our income depends on the viability of the pools companies, and we hope that they will remain successful. To their credit, the Government have made a number of concessions to allow them to compete fairly with the lottery. I shall not rehearse this evening all the arguments that we heard during the course of the Bill, but there are still areas where the playing field is not level —television advertising and the total tax rate of the pools, which is much higher than the lottery. I hope that the Government will continue to bear those issues in mind.

The second issue I should like to touch on is the foundation's relationship with the Arts Council. I am delighted that the noble Lord, Lord Palumbo, is to speak next. I am also delighted that my noble friend Lord Gowrie is to be the next chairman of the council. We have had an extremely fruitful dialogue with the council and we continue to benefit considerably from the advice that the council's experts provide to us on all sorts of funding and grant-giving matters. We are most grateful for that.

However, my fellow trustees and I are concerned by rumours, or whispers, that we hear that we may soon be asked to pay for that advice. That would not be a popular move. One of our overriding objectives is to deliver as much of our income as possible to deserving causes, and we would not like to see worthwhile applicants losing out to a new, additional expense. If for a relatively short amount of someone's time, and consequently cost, we give an amount of money many times larger to a worthy cause in the arts field, that surely is very much in the interest of the Arts Council with its overall responsibilities for the well-being of the arts.

I suspect that if the foundation were asked to pay for that service—I emphasise that we have not yet been —the result could be that we would use the service less and that could therefore lead to a less efficient targeting of our grants.

To conclude, I hope that I have persuaded your Lordships that the Foundation for Sport and the Arts plays an important role in the funding of the arts; and long may it continue to do so.

4.10 p.m.

Lord Palumbo

My Lords, first, perhaps I may pay tribute to the noble Lord, Lord Menuhin, for the excellence and elegance of his maiden speech. The noble Lord is an idealist and a visionary and those qualities are refreshing in these difficult days. However, I fear that those selfsame qualities, admirable though they are, do not always fit easily with the reality of arts funding at the coalface. In any event, the great authority and gifts of the noble Lord, Lord Menuhin, will add immeasurably to the quality of debate in your Lordships' House. I look forward, as will noble Lords, to the noble Lord's continuing and frequent contribution to public affairs in this place.

Next, I should like to correct, if I may, certain comments made by the noble Lord, Lord Donoughue, as they affect the Arts Council. First, the Arts Council does not employ 200 people; it employs 155 and that number will soon be 130. Secondly, the administrative costs of the Arts Council represent 3.7 per cent. of its budget and they are falling. I believe that that compares rather favourably with some of the regional arts councils whose budgets are 20 per cent. Thirdly, the activity analysis to which the noble Lord referred was an activity analysis that we were requested to make at the behest of the Department of National Heritage. Fourthly, your Lordships will know that I do not ever seek to whinge either inside or outside this House. But the fact of the matter is that in five years I have served five different Ministers or Secretaries of State. That is a great many Ministers. There has never been a moment in those five years—not one moment—when we have not been reviewed, counter-reviewed, surveyed, appraised and tested against market forces; and that has cost a great deal in time and effort. We estimate, although the calculation is imprecise and always will be, that it has probably cost the taxpayer something of the order of £6 million in an attempt to establish value for money—and I doubt very much whether we have been able to do that.

The arts are fundamental to a civilised community. They are the key to the life of the mind. They embody celebration, the raising of expectations and the uplifting of the spirit. The industry of the arts accounts for visible and invisible earnings and they are a major employer. In these few, unforgiving minutes left to me, I should like to draw your Lordships' attention to the following matters.

First, in any post-war, independent audit of our national talents, none would be found more successful and none more unsung by Government than the arts. The arts in this country are internationally acclaimed. Our Royal National Theatre and the Royal Shakespeare Company have no rival. English is the international lingua franca, and the pre-eminence of our language is reflected in the pre-eminence of our arts. That pre-eminence is hard won, for demands of financial support far outstrip supply.

So great is our stock of national talent that the arts have become the victim of their own success. Criticism, analysis, vilification, calls for abolition or reform, reports and inquiries strike the lightning conductor of the Arts Council of Great Britain and its chairman. We are accustomed to taking the flak.

The Arts Council of Great Britain is not a perfect institution. I have never claimed perfection for it. Mistakes are sometimes made—of course they are; and when they are we regret them. But equally, on some occasions, the blame that we receive is unjust. Take, for example, the future of regional theatre. It was never the wish, nor the decision of council, to withdraw funding from one regional theatre let alone 12, and I am happy to say that not a single regional theatre has had its funding withdrawn—and I hope that none shall.

The problem of London's orchestras stretches back for 30 years. No other capital city in the western world boasts the luxury of seven symphony orchestras, as we do, all competing for the same venues, the same audiences and the same sponsorship, all underfunded by reason of government parsimony. We have sought to refocus inadequate resources in order to enhance the musical life of London and perhaps we have taken the first small step along the path of prudence, but against what hail of criticism for daring to question, let alone disturb, the status quo.

We have, at the Arts Council, further been criticised for adopting so-called fatuous policies of "social engineering". Is it fatuous to apply a modest proportion of our funds to enable disabled people to participate in performances and to have access to exhibitions, theatres or concert halls, or to reward the rich artistic talent of our Afro-Caribbean and South Asian communities? Is it fatuous to provide access to the arts in hospitals or prisons? It cannot be. People may call those policies fatuous. I call them a response to the reality of our times and to the fulfilment of our chartered purposes.

In the past five years we have been proud to see the arts' subsidy from Government rise by 15 per cent. in real terms in what I had hoped was a latter-day conversion of the real worth of the arts and their place upon the political agenda. This year the Government have imposed the first cut for 48 years and in the next three years that cut will be sustained to produce a net loss in available funds for artists of 12 per cent. darkening that brief dawn of a 15 per cent. increase. That amounts to irresponsible neglect of a precious national resource which generates a three-fold return for every pound of taxpayers' money invested in it. The Government's timing, of course, is impeccable coinciding with contemporary decline in available funds for the arts from its mainstays of the local authorities, box office, sponsorship and charitable foundations. Little wonder that we spend per head on the arts in this country so much less than our European neighbours. The greater wonder is that the arts in this country are so successful and so cost effective. I am well aware of the vital necessity to constrain public expenditure, but I am also aware that success feeds upon itself, and that it should be encouraged and built upon, not penalised.

Is it not an act of the purest folly to apply funds for the refurbishment of the Albert Memorial at the expense of the performing arts when it is abundantly clear that funds from the national lottery are imminent and would be wholly appropriate for such a purpose? Lottery money will be applied for capital purposes only: for the restoration and creation of arts buildings. But if core funding is reduced, so too will be our ability to guarantee their operational cost.

The architecture of this Chamber is itself a living example of what artistic genius can produce when there is the proper combination of vision and the commitment of funds. The artist strives for excellence to create what is best in our contemporary culture and the monuments which will be the fit marks of whether we are or are not a civilised community. It is up to the Government to put that matter beyond doubt.

Yesterday was the Feast of the Conversion of St. Paul on the road to Damascus. Without being impious, I can only hope that the same blinding light and impact of conversion will profitably fall upon the Treasury and upon the Department of National Heritage.

4.19 p.m.

Lord Strabolgi

My Lords, I should like to add my congratulations to the noble Lord, Lord Menuhin, on his notable and moving maiden speech and, if I may, to follow his distinguished lead modestly by saying a few words about the state of classical music including opera in this country, and to speak of some of the difficulties faced at the present time due to the cuts in arts funding.

I am glad that the noble Lord, Lord Palumbo, is taking part in the debate, and I listened to his speech with great interest. Although he had achieved an overall increase of some 16 per cent. in real terms in the Arts Council's budget before the current cash cuts, the Government's grant-in-aid to the council for 1994–95 has been reduced by £3.3 million. That is a 1.7 per cent. cut. As the noble Lord, Lord Thomson of Monifieth, said, this is the first cash cut for the arts within living memory. In consequence, there has had to be a reduction in all music expenditure of over £550,000.

The first victims of these savage cuts might have been two of our four great London orchestras and for the added reason that certain people in the Arts Council —I am sorry to have to say this—quite erroneously apparently wanted a super-orchestra to rise from the ashes of the two most likely victims: the Philharmonia and the RPO. Although all four orchestras can now survive through the wise recommendation of the Hoffmann Committee, much uncertainty remains. It has been a humiliating experience for these orchestras. Even now, the RPO—of which I am an honorary life member —is still waiting to know what its grant will be for next year. The public subsidy to the Berlin Philharmonic is four times as large as that for all four London orchestras put together.

In contrast, all Britain's leading funded orchestras are in a financially critical state. I hope that the Arts Council will strive to restore confidence among its major music clients as quickly as possible. Why, one must ask, has the joint Arts Council/BBC review into national orchestra provision been put on ice? It is surely essential that this should be completed so that financial objectives and the necessary strategies to deliver them can be clearly defined. May I ask the Government to use their best endeavours to persuade the Arts Council and the BBC to continue this review with an independent chairman? I think that is essential.

We must not forget the tremendous contribution to classical music made by the BBC, which has an annual commitment to live music performances of about £30 million. The corporation is the biggest single employer of orchestral musicians in the country, with responsibility for five great orchestras. During the Prom season at the Royal Albert Hall, which is entirely funded by the BBC, 5 million people tune in to hear these concerts which are performed before packed audiences. Radio 3 transmits annually over 100 complete operas from the world's great opera houses and commissions about 30 new works from emerging new composers. I hope that the Government, when considering the future of the BBC, will remember these achievements and the cultural debt we owe to the BBC and not throw them away for ideological reasons.

English National Opera, at the London Coliseum, is suffering from the frozen Arts Council grant and business sponsorship is in decline. The result is that new productions at ENO have had to be cut in favour of revivals. But audiences decline if the production has been seen too often. It is essential that the opera companies are able to continue staging more new productions of operas which excite interest and attract audiences and also attract the most talented singers and conductors.

Covent Garden has the lowest subsidy of any opera house in Western Europe and consequently the highest seat prices. May I also remind the Government of the fact that La Scala in Milan is expected to generate only 30 per cent. of income while Covent Garden has to generate as much as 64 per cent. If our European partners, particularly Italy and Germany, give this level of support to opera, why cannot we? As the noble Lord, Lord Crickhowell, said, Welsh National Opera has had to announce cuts for the next season. These will include cuts in staff and the cancellation of a new production for the spring of next year.

In spite of all these difficulties, the Royal Opera House and our opera companies are striving hard to maintain standards and I should like to pay a tribute to them.

I hope that the Government will try to redress their own dismal record and enable the Arts Council to give our orchestras and opera companies the support they deserve.

4.25 p.m.

The Duke of Saint Albans

My Lords, it is with particular trepidation that I rise today, as it is nearly 127 years since a temporal Saint Albans addressed your Lordships' House. My ancestor spoke at some length on the Irish question. However, this long silence has not made me lose sight of the need for brevity and non-controversiality on this occasion.

I have to declare an interest in that I am president of a small opera company. Although a grant has never been received from the Arts Council, the local authority has up till now made a modest annual contribution. I understand that this is likely to cease as from today, due to a reorganisation of the authority's spending arrangements.

Not going back quite so far as 1867, it is 28 years since I first heard the noble Lord, Lord Menuhin, playing the Beethoven violin concerto under the baton of the late Dr. Klemperer at the Royal Festival Hall. Little did I imagine that we would be fellow maidens nearly three decades later.

That concert was to prove a momentous event in my life. Although I had previously responded to music, it was then and there that the power of music really spoke to me. Through music I began to learn the meaning of art—all the arts are interconnected and are generally based on the same principles.

The importance of the arts goes far beyond the money that comes in from tourism, the preservation of our heritage and the entertainment they can provide for all of us. It is through the arts that people can best widen their horizons so that they may be incited to experiment, to dare to create something new or develop the work of others. Even the cleverest—I use the word advisedly —and most capable scientist almost certainly will not persevere with the inevitable difficult problems and hardships that he usually meets face to face if hi s horizons are not especially wide. That is why, in the final analysis, a nation's achievements, whether materialistic or spiritual, owe a great deal to the arts. That is how Greece became the cradle of modern civilisation. Their government then was not richer. They had no more money than we have today. Therefore, governments must sponsor the arts and create the climate that will entice additional private sponsorship —an essential in the world today.

It would be wonderful and convenient if it were the other way round—for private sponsors to lure the Government. But life seldom, if ever, works like that. The Government must lure the private sponsors with all the means at their disposal. We cannot do without them, whether it is for our theatres, opera houses, concert halls, galleries, music and drama academies and so forth.

We must consider ourselves fortunate, civilised and grateful that our country can provide such a prestigious and appropriately variegated list. Our metropolis has been for several generations the centre—perhaps the greatest in the world—for music, drama and other forms of art. It is clearly essential for the capital to continue to rank first as far as excellence is concerned: all the more reason not to allow ourselves to become complacent but to maintain our basic strengths that have given us such an invaluable heritage.

4.31 p.m.

Lord Charteris of Amisfield

My Lords, it falls to me to congratulate the noble Duke, the Duke of Saint Albans, on his maiden speech, and I do so with the greatest pleasure. I hope we shall hear him often in this House. I hardly think we may find an occasion when we shall hear him in his hereditary position of Grand Falconer of England, but I am sure there will be many other interesting subjects which he can talk about.

It is a great privilege to take part in this interesting and important debate which the noble Lord, Lord Donoughue, has moved. I propose to restrict my remarks to the funding of the National Heritage Memorial Fund, of which I had the great honour to be chairman from its inception in April 1980 until March 1992. The fund is frankly peripheral to this debate but it is of course of great importance in ensuring that our museums and galleries can acquire objects for people to see.

I should like to begin my remarks by paying a wholehearted tribute to the Government—I thought that would surprise them !—on the manner in which they have supported the fund from the moment it started until now. This marvellous support makes the decision to reduce the resources of the fund next year even more remarkable and regrettable. The Act which set up the fund, the National Heritage Act 1980, decreed that the fund should receive an unspecified annual sum of money, and also that it should receive from Government such other monies as might be available.

The fund was endowed with £12.4 million when it was set up, which was all that was left from the resources of the National Land Fund, of which I shall say more in a moment. For the first 10 years the fund received an annual grant of £3 million. That sum was of course quite inadequate for what the fund was expected to do, which included the setting up and endowment for 14 country houses, the assistance for the acquisition by museums and galleries of great paintings and sculptures, from Altdorfer's "Christ taking leave of his Mother" to Picasso's "Weeping Woman", and much else. However, the Government had the great good sense to make use of the provision in the Act which spoke of other monies—to the tune, I may say, during those first 10 years, of £78 million.

I have sometimes heard this money described as "having come off the back of a lorry" but I repudiate that. I have made it perfectly clear that it was all laid down in the Act that this might happen. At the end of the first 10 years the Government announced that the fund's annual grant would be increased to £12.5 million a year for three years but that there would be no more extra money. I am glad to say that that promise was fulfilled but I am not so glad to say it has now been announced that for 1994–95 the £12.5 million will be cut to £8.5 million.

When one considers that £8.5 million is about what it costs nowadays to endow one country house and that for a great picture or a great piece of sculpture £2 or £3 million is par for the course, you can see that £8.5 million is very meagre as a grant for the fund. It would indeed prove wholly inadequate for what the fund is intended to do were it not for the share of the lottery money which the fund will receive for heritage purposes.

I must assume that the fund's annual grant was reduced because of the prospect of lottery money, and if I am correct it was clearly contrary to the Government's express policy on additionality and everything else which has been said about the lottery money being the icing on the cake and not the absolute substance of the cake itself.

I fear very much that the National Heritage Memorial Fund is going to become marginalised and, indeed, lost in the plethora of lottery money; and that it should become lost may indeed be Treasury policy. Perhaps the noble Minister, when she replies, will comment on this point. If that should happen, there is one aspect which I should deeply regret. The fund is a memorial fund and it was set up, as was the National Land Fund which preceded it, in memory of those who had given their lives to preserve our country.

Your Lordships will remember what happened to the National Land Fund, established by the Socialist government in 1945 with £50 million—the product of the sale of surplus war equipment. It was decimated by the Tory government in 1957 by having the original £50 million withdrawn and leaving it with only about £10 million. That is one hell of a way to treat a memorial fund, one might say. I urge the Government, with all the power at my command, not to let this happen again by starving the fund and by reducing its annual grant to a sum which will make it impotent. As the recovery from recession proceeds and as things get better, I hope with all my heart that her Majesty's Government will find it possible to provide those other monies for which the Act makes provision.

4.37 p.m.

Lord Eatwell

My Lords, I wish to join other noble Lords in congratulating the noble Lord, Lord Menuhin, and the noble Duke, the Duke of Saint Albans, on their maiden speeches. They have chosen to speak on an important topic this afternoon.

I wish to deal with two distinct issues: first, the overall management of arts policy by the Arts Council and, secondly, the provision of finance for education in the arts, particularly dance education. These two issues are apparently disparate, but in fact on closer examination I shall argue that both are part of a single failed arts policy.

First, then, the management of arts policy and more specifically the management of public money by the Arts Council: I speak from the perspective of someone who has served on the boards of two major contemporary dance companies. In both roles I have been involved in detailed negotiations with the Arts Council's Dance Department over a number of years. In all cases the manner in which those negotiations are conducted has, I believe, resulted in a significant waste of resources in terms of time and effort of dance company staff and board members and, which is perhaps more serious, a significant waste of public money.

The reason is, quite simply, that Arts Council officers will never ever tell you what their view on any matter is. Imagine what it is like sitting in a board meeting, trying to devise a new and constructive policy or what amounts to a new and constructive way of spending public money, and there in the corner sits a senior officer of the Arts Council, taking exhaustive and detailed notes, who refuses to comment on any idea you put forward, refuses even to hint whether a planned action is a good idea or not and intervenes only to repudiate any suggestion that the Arts Council may have a point of view.

As a result, the boards of companies are reduced to a continuous game of shadow boxing, trying to guess what will please the sphinx in the corner. In doing so they make mistakes, sometimes serious ones. On one board on which I served, anxiously glancing at the Arts Council representative sitting in the corner, we approved the expenditure of £10,000 of public money in support of a project which the appropriate committee of the Arts Council, unbeknown to us, had already decided to close down. The person in the corner knew that we were unknowingly wasting public money and said nothing. That person could say nothing because the decision, although already made, still had to be rubber stamped by yet another committee.

Noble Lords may take those remarks as an attack on the Arts Council, and in a way they are, but only in a way. The great problem that I see with the Arts Council, and the reason why so much public money is occasionally wasted in its operations, is that the organisation suffers from a massive lack of self-confidence—of course I am not referring to the noble Lord, Lord Palumbo. Afraid to be committed to a view, afraid to say what they think, the officers of the council desperately cover their tracks in a myriad of committees and layers of appraisals informed by rafts of criteria —all to disguise the bitter truth that none of them has the confidence to take the final decision and defend it; to back the arts. Yet it is backing the arts—dangerous, innovative, often unpopular art—which should be the fundamental role of the Arts Council.

That role can only be fulfilled by people with the self-confidence to make judgments; to declare and defend those judgments publicly and to carry them through. But today the Arts Council lacks self-confidence. Its officers know that they have no backing from the Government, who subject the organisation to the humiliation of annual funding, eliminating the possibility of any long-term planning. The staff of the Arts Council know that every controversial decision will be pilloried in the tabloid press to the delight of government Back-Benchers and the smug satisfaction of Ministers. They know that they are on the line and that they have no power to make controversial decisions.

The Arts Council fails to work because it is not independent enough; it is not funded enough and it is not backed enough. It can only work if its self-confidence is restored and it can only recover that self-confidence if its independence is restored, its long-term funding is guaranteed and it is run by people with the guts to make decisions and stick to them. It is the failure of the Government to support the Arts Council that has eroded the organisation's self-confidence and accordingly led to the waste of taxpayers' funds to which I referred earlier.

An even greater waste of resources—particularly a waste of talent and a bias against excellence—is evident in my second example of the Government's failed approach to arts policy. I refer to their failed approach to vocational training in dance and drama. As noble Lords will be aware, students taking vocational courses in independent institutions are not eligible for mandatory grants. Instead, grants are awarded by local education authorities according to their discretion. Faced with severe funding difficulties in recent years, it is not surprising that local authority discretionary grants have declined sharply. That decline is exacerbated by the fact that independent institutions, although officially classified as Colleges of Further Education, are not supported by the Further Education Funding Council and consequently student fees must cover administrative and capital costs as well as tuition.

The reaction of many, although not all, local authorities to those two factors has been twofold. First, even though their funding from central Government, defined within the standard spending assessments, contains a substantial sum to cover discretionary grants, they have in fact stopped giving discretionary grants altogether. Secondly, where discretionary grants are given, they are given at only a low level, often amounting to just a few hundred pounds to fund a course where the fees are £6,000 or £7,000 and living expenses have also to be covered. If in dance one has real creative talent, whether one will be able to exercise 'that talent depends on how wealthy one's parents may be. To add insult to injury, full-time students in dance are not eligible for the Government's student loan scheme.

The consequences for the pursuit of excellence in British dance are severe. Our dance schools—which are among the best in the world—are, on the one hand, forced to lower standards and compromise artistic integrity by admitting students with the crucial characteristic of the ability to pay; arid, on the other hand, they are forced to take large numbers of overseas students, who, while they may be very good, tend to return home, draining the flow of talent into British dance and dance education. In the face of that short-term policy, which denies the nurturing of talent and the pursuit of excellence, the Government have played a game of "pass the responsibility", claiming that discretionary grants are the sole responsibility of local authorities, while at the same time local authorities point to the squeeze which central Government imposes on their finances.

It is time for the Government to assume the responsibility which is truly theirs. As a first step, would it not be appropriate to ensure that the proportion of funds within standard spending assessments, designated for discretionary grants, should actually be spent on discretionary grants? Will the Government ensure that that happens? Secondly, would it not be appropriate to make full-time students eligible for the Government's student loan scheme? In the longer term, is it not right that the highest quality vocational schools should be accorded the status of maintained institutions, thus making their students eligible for mandatory grants? The disgrace of wasted talent and neglect of excellence which characterises the discretionary grants debacle, is a tragic example of the human and economic cost of the Government's short-termist approach to the arts. At the present time the Government's policy, both towards the Arts Council and towards dance education, is the denial of excellence and, for good measure, is also economically inefficient.

4.47 p.m.

Lord Crathorne

My Lords, first, I should like to thank the noble Lord, Lord Donoughue, for giving us this opportunity today. Secondly, I congratulate the maiden speakers. We must all feel extremely privileged that we appear on the same billing as the noble Lord, Lord Menuhin.

It is probably true to say that, whatever the level of government support for the arts, we would still be like Oliver Twist—asking for more. One of my economic professors at Cambridge taught us his own particular law of economics; he called it Haggenbrook's Law—whatever the level of income there is always a requirement for 20 per cent. more. I believe that he was talking about student income, but the same can be said of arts funding.

I listened with particular interest to what my noble friend Lord Charteris had to say. Indeed, his speech about the National Heritage Memorial Fund means that my speech will stay well within the eight minutes allowed. The fund achieved great things under his inspired chairmanship and he passed the torch to a worthy successor in the noble Lord, Lord Rothschild. I have the privilege of being a trustee and should like to add one or two points to what was said by my noble friend.

First, in regard to the lottery, if predictions are correct we shall have at least five times the amount of money to spend than we have at the moment. We are told that the lottery money is the icing on the cake. But the government cake will be totally overwhelmed by the icing. The Government stressed that lottery money should be additional money for new and different projects and purchases. That is fine as long as core government funding remains. As my noble friend Lord Charteris explained, our grant is being cut, which makes the additionality point a difficult one to sustain. I urge the department of National Heritage, when it draws up the guidelines for the NHMF, to give the fund the flexibility to make the best and most imaginative use possible of the lottery money.

Perhaps I may touch on another point raised by my noble friend. I refer to the memorial aspect of the fund. At every meeting we are conscious of the fact that we are there to preserve what the men and women of this country died to save. It would be hard to over-emphasise that point and I am worried that the NHMF is in danger of eventually being swept away by the tidal wave of lottery money. That, as we have heard, happened once before in the 1950s when the land fund all but disappeared. It must not be allowed to happen again.

The last point that I should like to make is quite a specific one and it concerns Canova's sculpture of "The Three Graces" which has been in the news again recently. It was in the news because the Secretary of State extended the stop period for another 18 months preventing it from going to the Getty Museum in America during that period. The sculpture was first removed from its specially designed temple at Woburn to go to the Treasure Houses Exhibition in Washington in 1985 and it had never really found its way back to Woburn since then. Opinion is somewhat divided about just how special "The Three Graces" is. One famous professor of art described the sculpture as being "bedroom" art, but there are others to whom "The Three Graces" is a sublime work which should remain here at whatever cost. In my view, if the sculpture is saved by lottery money it should be returned to the temple at Woburn which was designed to house it. It loses a considerable part of its significance once divorced from that original setting.

The 18 months' stop has been designed to give lottery millions time to start rolling in. But the National Heritage Memorial Fund cannot today guarantee to save "The Three Graces" in 18 months' time. It depends on what other items come up at that time. We can only consider the case of "The Three Graces" on its merits alongside other applications for lottery money in due course.

I should like to end with a general point because, with the arts, all of us speaking in the debate, and indeed the Secretary of State himself, are all on the same side. I just hope that the points and pleas for additional arts funding made today will strengthen the hand of the Secretary of State in fighting for arts funding which we all know to be so enormously important and effective.

4.53 p.m.

Lord Bonham-Carter

My Lords, I too should like to thank the noble Lord, Lord Donoughue, for giving us the opportunity to debate the important question of arts funding and to say that I have found the debate extremely interesting. In particular, I should like to congratulate the noble Lord, Lord Palumbo, on his spirited defence of the Arts Council, which is a kind of beating boy of the arts and which has faced over the past 14 years very considerable difficulties in conducting itself in an appropriate way, in keeping that very important principle of the arm's length relationship from central government, in maintaining its independence and in standing as the defender of the arts more generally.

I should also like to associate myself with everything said by my noble friend Lord Thomson of Monifieth on the heavy responsibility which now falls on the BBC and Channel Four in maintaining standards in broadcasting and television owing to the deplorable consequences of the Broadcasting Act 1988 which were foreseen at the time and neglected by those who pushed it through Parliament.

I must declare an interest on this occasion as I am chairman of the governors of the Royal Ballet and have been associated with the Royal Ballet in one capacity or another over many years.

In what I have to say there are only two points I want to make. First, I would ask a question which I hope the noble Baroness will find time to answer when she replies. I simply cannot understand what the policy of the Department of National Heritage towards the arts is. I hope she will give us a clear exposition of what its policy is and what its priorities are. As a number of noble Lords have said, it is a fact that the arts repay government grants two or three times. Overseas sales and the expenditure by foreign visitors amount to £6 billion per annum. British drama, opera and ballet are a national asset.

It is also a fact that the Arts Council grant has been cut by £3.3 million for the first time in history. It is also a fact that additional funds of £16 million have been found for the British Library—hardly the greatest success story of the past few years; in fact it is something of a scandal. That £16 million has been found just before the national lottery comes on stream. The policy is unintelligible. What are the department's priorities? Why is it funding a capital project when the lottery is just about to come on stream, and why is it cutting the performing arts? It is an extraordinary policy which demands justification. It is a policy which appears totally to neglect the maxim that one should support success. It is a policy which appears to be based on the principle that one starves the goose that lays the golden egg.

I want to explain what starving the goose that lays the golden egg means, for instance, to the two companies of the Royal Ballet. I do not have to remind your Lordships of the reputation of those two companies. They are two of the great dance companies in the world today whose pre-eminence is emphasised by the position in which the Russian companies now find themselves and by the position of the New York City Ballet today.

It is generally recognised that those two companies have never danced better. They boast great dancers, male and female, mostly trained here, but they have attracted great dancers from abroad. Their international success has rarely been greater. Only last week the Royal Birmingham Ballet was in Turin dancing "La fille mat gardée" and its performance was hailed by Corriere Della Sera as "a triumph"; Mukhamedov was described as "forte e fiero" and Sandra Maadgwick as "absolutely delicious". Their reputation abroad is enormous, a point which must be taken into account.

The Arts Council grant to the Royal Opera House has been frozen. That amounts in real terms to a cut of about 3 per cent. To meet this and to continue to reduce the deficit, Royal Ballet performances are being cut from 120 to 96, opera performances have been increased by that number since people are prepared to pay more for opera and touring abroad by the Royal Ballet has been increased. Touring abroad is fine as long as it is not done excessively. The increase in the size of the company which was promised has been postponed. The balance of the repertory has been altered and there has been an unfortunate tilt to full-length ballets and classical works at the expense of triple bills, new works and experimental works.

That is a way to kill a ballet company. It is the quickest way one could have of killing a ballet company. It drives away dancers, choreographers and audience. A ballet company cannot exist by repeatedly performing the small repertory of classics. If it does, its audience will be reduced to a small hard core of balletomanes and it will never break out of that audience. It will not hold, develop or attract great dancers. Frederick Ashton made Fonteyn into the great ballerina that she was. Mukhamedov came here because he wanted to dance the works of MacMillan.

New works are the lifeblood of a ballet company. Choreographers must be allowed to experiment and the way they do that is by doing triples—that is, short works which have to be performed in triple bills. That is what is at risk.

The director of the Royal Opera House has given an undertaking that this shift in the balance of performances in the repertory will be corrected directly the deficit is eliminated. But unless funding is increased it is difficult for me to see how that deficit can be eliminated. If it is not eliminated, presumably we shall be in the same position as we are today.

The second point I wish to make on that count is this: touring abroad is fine as long as it is not done excessively. But if it is done excessively, which I believe to be the position now, it means that the British taxpayer, who is paying for the ballet, is deprived of the opportunity to see it, and that is wrong. What this situation emphasises is the urgent need for the establishment of a dance house which the Arts Council has supported. It is high time that steps were taken to establish it.

For all these reasons, what is required of the Department of National Heritage is a clear statement of what its priorities are and the willingness and ability to fight for the funds to make those policies possible.

5.1 p.m.

Lord Macaulay of Bragar

My Lords, I rise to speak in this very valuable debate as a modest consumer of the arts, mainly in the Scottish context because I cannot afford the price of tickets in London. When the noble Lord, Lord Palumbo, mentioned at the outset of his speech to your Lordships the pre-eminence of the English language and, by inference, the pre-eminence of English culture, I am sure that he did not intend to provoke a nationalist argument in your Lordships' House.

But it raises an important point because in dealing with the question of funding it is important to recognise that Scotland, as a separately identifiable nation within the union, has a wealth and depth of culture and associated characteristics which one would naturally expect from a nation with its own identity. Within that nation the cultural activities are diverse, encompassing music, language, song, dance, arts, theatre and so on. In considering the question of funding there is a problem —perhaps unique to Scotland but which perhaps applies to certain other parts of the United Kingdom—that the physical characteristics and structure of the country, with a large, non-urban landmass carrying a small but valuable 20 per cent. or so of the population, is there along with the main population of almost 80 per cent. contained in the urban central belt. That creates obvious structural and logistical problems in disseminating the arts and in supporting them in all their forms in all regions of the country. To that extent, the per capita quotient may not appeal to accountants, but it may be a necessary reflection of the difficulties in getting arts to the more remote areas.

In that respect, one must not be all gloom and doom. One must pay tribute to the fact that £9.5 million has been given to Gaelic television to promote the language, which is proving to be a major success. It is hoped that that will not be just a one-off payment and that people will shake their hands and walk away. Obviously, the use to which the £9.5 million has been put will be closely scrutinised and analysed. We hope in Scotland that the support of the Gaelic language television and, with that, the support of the community which speaks that language, will be continued.

We also welcome the fact that the Scottish Arts Council is being brought under the Scottish Office, which is already responsible for various aspects of Scottish culture; the Scottish Film Council, museums, national galleries, libraries and so on. It is an important strategy which should bring about a coherent cultural approach to the arts in Scotland and which will be able to recognise the particular Scottish issues and needs.

Along with that there is the move for the establishment of a new Scottish Arts Council. As has been mentioned already, it is important that the composition of the arts council is very closely looked at and that, once established, it should be properly funded and at such a level as to carry out its functions properly and not to be another strangled quango, saying much and doing little.

Out of the £250 million which my noble friend Lord Donoughue mentioned, it is estimated that local authorities in Scotland spend £100 million on culture and supporting the arts. That is really a phenomenal contribution bearing in mind the strictures within which the local authorities work. I suggest that the contribution of the local authorities should be mirrored by the Government's contribution and support for the arts. We hope that the local authorities, the Scottish Trades Union Congress and all relevant groups will be represented on the new Scottish Arts Council to represent the geographical diversity of interest and cultures.

The Government must recognise that promoting the arts could stimulate tourism, provide a welcome jobs boost and expand cultural activities in Scotland. The Government and the Prime Minister should consider appointing a Minister for the Arts in Scotland specifically to deal with the special character of Scottish culture development. Such a Minister would be directly accountable to Parliament where he would present an annual report and be subject to the scrutiny of a Scottish select committee and of Parliament itself, but not necessarily in that order.

The Government must also look at ways of increasing the level of funding for the Scottish Arts Council to at least the same level as its Welsh counterpart. It is disappointing to say the least that the Government's cash settlement for 1994–95, taking out the element in relation to crafts, apparently leaves arts funding in Scotland at a standstill whereas the Welsh Office is providing the Welsh Arts Council with a 4 per cent. increase in its budget. It would be useful to see that reflected in Scotland.

At present the funding of the arts is derisory in the United Kingdom. As I understand it, we spend one-third of 1 per cent. of government budget on the arts and the Scottish share has to come out of that. We compare unfavourably with our European colleagues. Indeed, Catalonia does better for the arts than Scotland, but that is not casting any aspersions on Catalonia, though it certainly says something about the Government.

The BBC was mentioned. I suggest that the level of network programmes and others made by the BBC in Scotland should be increased to represent the number of licence holders and viewers in Scotland. Between 7 and 8 per cent. of the licence holders involved have only about 4 per cent. of production. The making of more programmes in Scotland is vital to the development of the arts in non-urban areas and rural areas—call them what one likes—and to the overall expansion of cultural activities in Scotland. In that regard the BBC has a unique role to play. One would like to see more Scottish programmes going on network and, if nothing else, to defuse the image of Scotland given by such programmes as "Rab C. Nesbit" and "Taggart" on independent television. That is not Scotland and certainly does not represent Scottish culture.

It is also to be hoped that Scotland's share of the national lottery and the Millenium Fund will be used to promote cultural activities throughout Scotland and not for one major prestige product. I understand that a good example might be the provision of mobile theatres, which I understand is presently done by the Royal Shakespeare Company, to take cultural activities of all kinds to remote areas where venues may not be easily obtained and in particular to take cultural activities to the Highlands and Islands.

The Government might also consider a special grant to develop the promotion of Scotland abroad, again taking the lead from Wales, where the Welsh Office has allocated £100,000 to the Welsh Arts Council for international initiatives. I am not jealous of the Welsh only because they gave us a good thrashing at Cardiff Arms Park a fortnight ago—

Lord Morris of Castle Morris

Hear, hear!

Lord Macaulay of Bragar

My Lords, I hear some cries of joy from the Front Bench. But those are serious issues which I have sought to put before your Lordships' House in a constructive spirit.

In conclusion, the promotion and funding of the arts is of vital importance at this stage in an age when our native culture and, indeed, culture itself is being eroded day by day by a never-ending sea of inconsequential, mind-numbing productions of pap on television aimed solely at the ratings, as the noble Lord, Lord Thomson, said. That tide can be turned only by an enthusiastic and co-operative approach towards the real arts and the dissemination of culture, not only in Scotland but throughout the United Kingdom. We will work with the Government if the Government will work with us. We all look forward to the promotion of the arts being improved.

5.10 p.m.

Baroness O'Cathain

My Lords, this debate is proving to be constructive in part, particularly in acknowledging the great contribution made by the arts to the life, economy and reputation of this country. But we must be realistic to the extent that resources are finite and, while making demands for additional funding, due cognisance must be taken of the implications of such demands on the tax structure and/or reducing expenditure in other areas in order to raise such additional resources.

In my Barbican Centre role, I am probably the only person speaking in this debate who is an employee of an arts organisation. As such, I feel that I have a responsibility to put to your Lordships' House a personal view, from my working perspective, of the issues raised by the title of this debate to balance what I fear is turning out to be a fairly subjective debate. The arts are one of the greatest assets of this country and have an enviable international reputation, as my noble friend Lord Palumbo so eloquently described. As they have such an enviable reputation, why is there the constant demand that they need more funding? I fear that we spend far too much time looking at funding levels overseas where, let us remember, their arts are not as successful as ours.

Of course, I acknowledge that there is a genuine need in some areas where local authorities have been cutting back on their funding. Not all local authorities can, or wish to, fund the arts to the extent that the City of London Corporation funds the Barbican Centre, the Royal Shakespeare Company and the London Symphony Orchestra (among other arts funding activities), thereby taking pressure off central government. I know that I am in a very fortunate position: not only is there no cutback, but the funding is actually increasing. However, the corporation is not a "soft touch". It insists on sound financial accountability, a point that I shall come to again.

Naturally, everybody would like more government funding, but I want to suggest that before we make a structured—and I use that word advisedly—appeal for more funding we must consider the following six points. Is the arts sector convinced that the current funds are well spent? Is the arts sector convinced that it should have additional funding at the expense of other government expenditure? Does the arts sector think that the public at large would be quite happy to pay additional taxes in order to increase funding if it is not acceptable to requisition funds from current recipients of government expenditure? How would the arts sector spend the additional funding? Who would benefit from additional funding? And, finally, is there a better way of arts funding than the current system?

I will briefly give your Lordships some indication of my answers to those six questions. Are current funds well spent? I doubt it. I refer to the Sunday Telegraph of 23rd January. The D'Oyly Carte company would be homeless because the Alexandra Theatre in Birmingham is likely to have to close, and I quote, after a number of loss-making projects culminating in a home-grown, ill-fated musical "Bertie" with losses approaching £500,000". It is just as easy to make bad decisions in the arts as it is in any other area of business—as I know only too well. By promoting an overseas orchestra to play four concerts in the Barbican Hall, I lost some £200,000. There are those who say that that money was well-spent, but I doubt it. Our audiences were pathetically small so not many people benefited from the exercise (each member of the audience that did attend was subsidised by us to the tune of over £50 per head.)

There is an absolute requirement to improve (and in some cases to introduce) financial accountability in the, arts. Many organisations do have such accountability, but many do not. The Arts Council of Great Britain organises appraisals of its clients but, having taken part in one of those appraisals, I have to concede that a wily arts organisation could be quite capable, of pulling the wool over the eyes of the appraisers—and I was one of them. I am not saying that they do, but if I were being appraised I think I would not have too much trouble in so doing!

I believe that there is a case to be made for the Arts Council to act as consultants to its clients on business and financial practices. I am aware that not all arts organisations can have a strong professional management structure as the Barbican has, but there could be a role for the Arts Council to take on this responsibility for those who lack such a structure.

I should like to correct the impression that might have been taken as being true about the apparent incompetence, spinelessness and deaf-mute characteristics of Arts Council officers. That is not true. I attend meetings twice a month which are also attended by officers of the Arts Council of Great Britain and I certainly cannot recognise the picture that was painted by the noble Lord, Lord Eatwell.

I turn now to my next question: should there be additional funding at the expense of government funding in other sectors? I cannot resist making the point that one man's pile of bricks in the Tate is another man's kidney dialysis machine. And what about the Accident and Emergency unit at Bart's?

On the third question: do we think that art increase in taxes specifically to fund the arts would be acceptable to the British public? Well, perhaps this should be tested. At the time of the next general election, it will be interesting to see if it is mentioned in the Party manifestos. All that I can say is that the arts sector is unlikely to think that that would be acceptable—witness the reaction to VAT on tickets and to the suggestion that there might have been VAT on books in the most recent Budget.

On the fourth question: how would additional funding be spent? Not, I hope, on yet more administrators! I guess that the reply would be, "It is up to us to determine how any money should be spent; we will not brook interference". But the furore created recently in the Brian Sewell controversy encourages me to think that those who fund—the taxpayers, you and I, my Lords—will always be somewhat uneasy with unfettered expenditure by creative people.

It is a bit like new investment in manufacturing industry—everybody wants it—or expenditure on new product development, which is acknowledged to be "a good thing", but which frequently fails to match up to expectations. As is generally known, some 90 per cent. of all new product development never gets beyond the prototype stage. If there were specific projects which could be ring-fenced or earmarked, I would support additional funding but, surely, this is what the lottery money is supposed to do.

On the subject of lottery money, may I sound a note of warning? Unbridled expansion of arts facilities funded by capital from the lottery would directly impact on current revenue funding by the Department of National Heritage when such arts facilities would be looking for shares of a currently committed budget.

And to my fifth question: who would benefit from the additional funding? Answer: it depends on the projects, but let me just offer another word of caution. In my experience of four years' standing, I can assure your Lordships that many projects are put on by the arts sector for the enjoyment, entertainment, education and enlightenment of those who work in the sector. Not too often do you hear the question asked, "Will the man or woman in the street benefit from this?"

Then again, the artists themselves could benefit from the additional funding. None of us would want to see British composers die as paupers as did Mozart; but, dare I suggest that sometimes additional funding could have the result of keeping second or third-rate artists and performers in business when for the greater good of the arts in Britain as a whole it might be better if they tried their hand at something else.

What we must not do is to dilute the acknowledged pre-eminence of the arts in Britain by encouraging the young girl with a pleasant voice to believe that she will be the Kiri te Kanawa of the 21st century.

Now to the final question: is there a better way of funding? I suggest that there are at least two better ways of funding the additional moneys that so many noble Lords have requested today.

I should like to ask the Minister—and I have given her notice of this—whether she could prevail upon the Treasury to look kindly on the suggestion that the American system of tax breaks for individual funding for the arts should be introduced here.

I make that suggestion because, despite what the perception might be, the reality is that the projects, the companies, the art forms which receive the greatest amount of government funding through the Arts Council are very often enjoyed by that segment of the population which could easily afford to pay the true price of the ticket. I believe that those people would be much more prepared to fund the arts if they felt that the Government were supportive of their intentions that the arts should thrive and recognise it by giving them tax breaks.

We should, however, be aware of the possibility that if the US system were introduced here, there could be a reduction in current charitable giving through both Gift Aid and the Charities Aid Foundation. Is that something that we would be prepared to risk?

The second suggestion upon which I should like to have the Minister's view is this. As a significant part of current funding and the demands for additional funding are based on the aim to carry out an educational role, would it be possible to fund from the Department for Education those arts activities which are recognisably educational? The Minister looks in horror, I fear.

Many of your Lordships have drawn attention to the great contribution to arts funding made by local authorities (51 per cent. of total arts funding in each of the past two years) and business sponsorship. Business sponsorship is not in decline. There was a blip in the figures last year due to the Japan Festival and Glyndebourne. It is increasing. The average annual increase has been 15 per cent. over the past nine years. We should be, and must be, proud of the arts, but let us not fall into the trap of thinking that by throwing money at something it will be even better. That is a fallacy.

5.20 p.m.

Lord Howell

My Lords, I apologise to the House for having had to ask my noble friend Lord Eatwell to change places with me because I was chairing a meeting of the sports group elsewhere. I shall return to that in a moment because it is the first point that I want to make. I am grateful to my noble friend Lord Donoughue for his devastating speech and for giving us the opportunity to debate this subject. We rarely do so. The number of noble Lords taking part shows that we should return to it more frequently.

In 1964 Harold Wilson appointed Jennie Lee to be the first Minister for the Arts and myself to be first Minister for Sport. Before the 1966 election, I wrote to Harold Wilson and said, "I think that you have made a mistake". Harold Wilson was a Prime Minister who did not like to be told that he had made a mistake, so he ignored my advice that he should bring together the arts and sport in one department. I am glad that we have done that at last. So I am a little critical of my colleagues who wish to divide up the subjects again today and debate the arts apparently in isolation from sport.

The reason I chose to say what I did was that I believe sport, like the arts, is a cultural pursuit. We should not engage ourselves in distinguishing between one person's cultural pleasures and leisure interests and another person's cultural pleasures and leisure interests. They go side by side. In any case, it is ludicrous to suggest that those people who like to watch football or cricket, by some odd quirk of logic, do not appreciate good theatre or good music. We have to provide right across the board; in other words, we have to have a philosophy and social purpose about leisure which I thought the noble Lord, Lord Menuhin, in his excellent maiden speech, was describing. He was trying to set out what the soul of music and the arts should be. I would say also, the spirit of sport. Those things go together.

The noble Baroness, Lady O'Cathain, told us about all the economic jargon that she would like to apply to the arts, but she missed out the most important one which I investigated when I was Minister for Sport. We must assess the cost of failing to provide leisure facilities and the effect that that has on crime, hooliganism and so on in our society. We did that, and it is considerable. So, if we are to strike a balance, let it be a true and proper one. Everywhere we look now—we are closing down sports centres and locking people out from them—we see an increase in the amount of juvenile delinquency, hooliganism and boredom in our society. That is something which I know everyone on all sides of the House regrets, but we must understand the reason for it.

If millions of people have no jobs, no leisure resources and no one to provide for their leisure, what on earth do we think will be the result? In any proper philosophy and policy for the arts, we must have regard to the availability of leisure time, the provision of facilities and then to the exercise of choice. It is up to individuals as to which of the facilities—sports, arts, theatre, music and so on—they wish to pursue. As I say, if we fail to provide them, we shall find a lower quality of life and all the problems associated with that factor.

The second point I wish to make, which has already been referred to, relates to the funding of the Arts Council, and the Sports Council, I add in passing. One cannot turn off funding like a tap. That is not possible for the Government, the Arts Council, the Sports Council and certainly not for local authorities. It will have a devastating effect on the provision of facilities unless an assured continuation of funding can be guaranteed. I shall illustrate that point in a moment by talking about the City of Birmingham Symphony Orchestra of which I have long been a patron. Indeed, one of the things I treasure most in my public life, despite all my years spent on sport, is that I was chairman of Birmingham City Council when it made the first grant to the City of Birmingham Symphony Orchestra in the 1940s. That led to this magnificent orchestra, with its wonderful director of music, Simon Rattle, being available to the nation as well as to the citizens of Birmingham.

I can talk also about the theatres, in particular the Alexander Theatre which the city has kept going at great expense. I regret to say to the noble Baroness, Lady O'Cathain, that it was the private company, as I am sure my noble friend Lady Fisher will outline in a moment, that collapsed, not the Arts Council or the City of Birmingham.

Baroness O'Cathain

Bad management, my Lords.

Lord Howell

My Lords, bad management in the private sector. I do not know what we do about that, except to note that it happens also in the noble Baroness's domain so far as concerns the concerts she was promoting, which were apparently unsuccessful. I return to the subject of the City of Birmingham Symphony Orchestra and local authority spending. First, there has been a drop this year of £2.5 million in the amount of money available to local authorities for patronage of the arts. It was £323.2 million, as my noble friend Lord Donoughue said, and it has dropped by £2.5 million this year because of all the restrictions and capping of local authority expenditure. It is £15 million less this year than it was in 1991–92.

Again, I say to the Minister and the Government, if you are interested in promoting arts (and sport)—in parenthesis —you must have regard to the fact that for both sport and the arts local authorities are the great providers. They provide the mass of facilities so that ordinary people can enjoy themselves in the cinema or in the theatre or kicking a ball backwards and forwards on the sports field. Therefore if you restrict local authority spending, whatever the economic rationale may be, you are doing great damage to sport and the arts. That is the first lesson we must learn.

I do not know whether it was mentioned in my absence, but the decision of the DNH to spend so much on the Albert Memorial, at the expense of live theatre and music—

Baroness Trumpington

My Lords, no.

Lord Howell

My Lords, is it not? I believe that it is. I shall be glad to hear the Minister talking about that in a moment. The City of Birmingham Symphony Orchestra earns 60 per cent. of its own revenue. It has 101 players and, as I say, a brilliant musical director. Ten years ago it was earning only 40 per cent. It has gone to great lengths to raise its own revenue. At the same time, the city council is making a donation of £1 million and the Arts Council a donation of £1.4 million. It should not go without mention that it pays £240,000 in VAT and £700,000 in PAYE, so it is earning revenue for the Treasury too.

I have reached the end of my eight minutes, so I shall not trespass upon the generosity of the House. I merely say, as other speakers have, that I believe that sport and the arts represent the soul of the nation. They are the end product in people's lives. Good housing, good homes and good education are important, but the way people can express themselves and develop their personalities is through the arts and sport. A nation that neglects that essential fact is doing its citizens a great disservice.

5.30 p.m.

Lord Skidelsky

My Lords, I congratulate the noble Lord, Lord Menuhin, on his profound maiden speech. I was moved by it and considered it to be an important contribution to the debate. I regret that I may have to leave the House shortly before the debate is to conclude.

I agree with the noble Lord, Lord Donoughue, that we need more money for the arts. Apart from their civilising influence, the arts are a good investment and are good for all the economic reasons that have been mentioned. But I also agree with the noble Baroness, Lady O'Cathain. The fact that the arts need more money does not mean that all or most of it must come from the state. That is an important point to make because during the past few years we have learnt that the institutions which rely entirely or largely on public funding are likely to be caught short when that funding dries up or is reduced. Moreover, they are likely to be subjected to an intolerable degree of inquisition in the names of accountability and value for money. That is the modern way of the state.

That is not only as a result of Thatcherite ideology of the recent recession. There has been a general shift of opinion, backed by voters throughout the Western world, in favour of a reduction in taxes and in public spending for which taxes are raised, as a share of national income. The implicit assumption in the current debate about whether taxes are greater under the Conservative Party than they would have been under the Labour Party is that lower taxes are a good thing. The debates make no sense outside that context. If one is being moved by politics towards a lower tax system, the extra money for the arts must come from private sources. There is no long-term alternative to that. In parenthesis, the only justification that I can see for the National Lottery as a tax system—it is a very regressive tax system—is that politically it is easier to raise money for the arts in that way than through the otherwise silted channels of orthodox finance. But that reinforces the point that I am making. There is less tax tolerance.

In Britain the arts are especially vulnerable to any move to reduce public spending. Early on the British Monarchy lost control over supply and therefore we have never had the Continental tradition of lavish state patronage of the arts. The arts have always had to struggle against a penny-pinching Treasury and there was nothing new about that in the 1980s. One great lost opportunity of the 1980s was the failure to make progress with the British Library. The project was announced by the noble Baroness, Lady Williams of Crosby, in 1978 and it is still unfinished. It was held up until 1985. At that time there was a wonderful opportunity to get on with it because there was a great deal of spare capacity in the economy and low cost. Its building was finally started towards the height of the boom when all costs were rising. Therefore, the cost of the project escalated and it is still unfinished. That is a scandalous example of Treasury penny-pinching.

However, I do not accept the gloom and doom which the arts lobby tends to tell. There is artistic life apart from public subsidy; indeed, it has never flourished more abundantly than at present. The arts centre at my own university of Warwick is the largest and most successful of its kind outside London. It has received some university subsidy but it was built largely from private subscription. It earns about 70 to 75 per cent. of its running costs in box office takings and sponsorship. It does so by offering a varied and attractive programme of performing arts to audiences which come in from all around the region. It, too, is suffering from the recession, but that kind of ratio of private-to-public income should not be beyond the attainment of most performing arts centres.

While what the noble Earl, Lord Gowrie, called a central subsidised core of arts funding should always remain, it is right that an increasing share of arts income should come from the private sector. That is not just because of the tax constraint but because the supply of arts should always be responsive to demand. Of course, we must be willing to subsidise experiment, but we must recognise that art forms for which there is a persisting lack of demand cannot be sustained by subsidy alone. That is the Achilles' heel of the whole system of art subsidy.

Perhaps I may reinforce an earlier point. If we decide to go down the American road, as I think we must, we have to make it easier for givers to give and sponsors to sponsor. We have a charitable tax regime, which is in many ways as liberal as the American regime, but the process of giving and sponsorship is much too enmeshed in bureaucracy. Why do we need the Inland Revenue to intervene between a gift and a receipt? If in America I want to give money to a charitable cause I write out a cheque and deduct the amount from my taxable income. In this country we stick to variations of the old covenant system, which was devised for a completely different tax regime. The fact is that any piece of paper that has to be applied for, looked for and processed is a cost to the donor and to the recipient. I urge the Treasury to take up Michael Heseltine's passion for deregulation and to make it easier for donors to give, sponsors to sponsor and organisations to receive.

I conclude by echoing what was said by the noble Baroness, Lady O'Cathain. I ask that a long holiday be taken from attacks on the Arts Council—that remarkable and quintessentially British institution which was started largely by Lord Keynes. To a large extent the Arts Council has been made a scapegoat for cuts in public spending. It has had to make difficult choices about quality. As a result there has been a never ending story of grief and outrage from those whose support has been reduced or cut.

But there is another factor which is more distressing; it is that much of the abuse of the Arts Council has been led by the press, and in particular by the recently compulsorily-retired Secretary of State for National Heritage in the arts pages of the Guardian. It is foolish for arts correspondents constantly to rubbish the Arts Council because they are playing into the hands of those who wish to abolish it and to transfer its remaining responsibilities to the National Heritage Department. In my view, that would be a disaster. I welcome the vigorous defence of the Arts Council put up by the noble Lord, Lord Palumbo, and his defence in print of the arm's length principle. It is for Parliament to decide on how much to allocate to the arts, not to run an arts policy. The arm's length principle was devised to insulate the distribution of arts money from politics and to relieve the Secretary of State of tasks for which he has neither the competence nor the credibility. But that principle cannot live on a diet of destructive criticism.

appeal to the media, therefore, to lay off the Arts Council. It must be remembered that each year more than 100 people give it days and months of unpaid service. My motto would be to err on the side of generosity and to be constructive in criticism. Otherwise the press will run the risk of destroying an institution which since the war has done very well by British arts and, in the process, run the risk of damaging the prospects of the arts in this country.

5.40 p.m.

Baroness Hilton of Eggardon

My Lords, I too express my gratitude to my noble friend Lord Donoughue for introducing the debate which for me provides an agreeable interlude between talking about the police service last week and prisons next week.

The theme that I wish to address briefly is the nexus between national power and prosperity and public patronage of the arts. Other speakers have floated that idea to some extent. There is two-way traffic. It is not just that flourishing arts are a barometer of national self-confidence and well-being but the arts contribute to national confidence, prosperity and well-being. If one looks historically at the high spots of cultural activity, one can see that in the fifth century BC the Athenians embezzled ship money to build the Parthenon. It is clear that that society felt self-confident; all its citizens were involved in it; and it was prosperous. That has been a lesson to us all. An example outside the European mainstream of culture is the Tang Dynasty. Court patronage caused poetry, music, dance and ceramics to flourish for nearly 300 years.

Renaissance Italy may have appeared to have had private patrons, but the Medicis were ruling Florence, the Sforzas were in Milan and the Montefeltros were in Urbino. They were the effective public patrons of the day. Above all, the patronage of the Church and the Papacy meant that money went to people like Michelangelo, Leonardo da Vinci and so on. Therefore, it was not small, private patrons or businesses which provided the money in those days, unless the Church is seen as a business. I believe also that the self-confidence, energy and prosperity of Italy in those days not only produced the arts that flourished. It was the fact that the arts flourished that produced the self-confidence and prosperity.

In those days artists were seen primarily as craftsmen in need of employment. It is only with Victorian England that we have the romantic idea that artists should starve in garrets if they are to produce better art. I detected a hint of that in the speech of the noble Baroness, Lady O'Cathain. Also—and it worried me —I believe that she felt that second-rate and third-rate artists could be easily identified. Surely it is a function of public patronage of the arts that people are encouraged before it becomes clear that they are first-rate artists. Art must be nourished in its early and embryonic state.

Nevertheless, public patronage in Victorian England produced great, exuberant public works. Waterhouse's great town halls and natural history museum belied his nickname of "slaughterhouse", because most of his buildings were created in red brick. The two that I know best are the Manchester town hall and the Natural History Museum. Of course, they are not red brick. Other examples of such buildings are St. Pancras railway station and most of Whitehall. They exemplify the national self-confidence and prosperity of the Victorian era, but I am sure that they contributed also to the public mood of self-confidence and optimism of the age. I believe that that is a major function of public funding of the arts.

In the 20th century this country seems to have lost much of that self-confidence. I believe that that has been due to public mean-spiritedness as regards the arts. As my noble friends Lord Donoughue and Lord Macaulay said, we are much less generous in that respect than our European neighbours. France, Germany and Holland contribute twice the amount in public funding to the arts. It is perhaps no coincidence that we are now below those countries in the European table of poverty of nations. We have now fallen below the average for the rest of Europe. To some extent that is a reflection of what has happened to this country.

For the past 15 years the Government have been both philistine and parsimonious. They have welcomed a retreat to Victorian values. But I believe that reliance on private sponsorship is not enough for the arts. We have heard that not only has private sponsorship been reduced—although that is debatable—but public spending has been reduced, and there has been that shocking cut of over £3 million from the Arts Council budget. There has been a consequent reduction of £0.25 million to the English National Opera, of which I too am a great fan.

If the Prime Minister is serious about reducing class differences in this country, one of the most effective ways to do that would be to promulgate a common culture. I agree with my noble friend Lord Howell that cricket and football are part of that culture. However, there are other aspects which should be encouraged and disseminated throughout our society.

Culture is enhanced by live performances. They need to take place outside London. We need to have not just the Welsh National Opera touring the country but the English National Opera needs to be able to fund touring examples of its works. Major artistic projects should be funded not just because they produce a financial return to the country but because they contribute to national self-confidence, buoyancy and prosperity. As the noble Lord, Lord Crickhowell, said, modest expenditure can produce excellent results for the arts.

I am reluctant to suggest anything that would restore the fortunes of the present Government but, to use the old adage that people need circuses as well as bread, I suggest that perhaps they should concentrate less on bread and more on circuses and increase rather than diminish their support for the arts.

5.45 p.m.

Lord Birkett

My Lords, I am happy to join with other noble Lords in congratulating my noble friend Lord Menuhin, on his wonderful maiden speech. The noble Lord's genius and vision have for many years shone out of the music that he has played. How nice it is that there should be an opportunity in your Lordships' House for him to extend that vision to all areas of life.

I congratulate also the noble Duke, the Duke of Saint Albans, on his maiden speech. He is known to be an exceedingly musical fellow. Like the noble Duke, I attended the concert at which my noble friend Lord Menuhin played the Beethoven concerto under Dr. Klemperer, and I found it, as did the noble Duke, a revelation. It is nice that the timely and welcome debate of the noble Lord, Lord Donoughue, should give my noble friend Lord Menuhin an opportunity to receive excellent notices for a concert several decades after he gave it.

My noble friend mentioned the excitement of conducting a great orchestra. There has been much debate about great orchestras and indeed, about a super orchestra. I believe that one small factor was left out of all those multifarious debates. It is quite true that you cannot make a super orchestra by abolishing other orchestras. It is equally true that you cannot make a super orchestra merely by throwing money at it. One small factor is absolutely necessary: it is called Solti, Karajan or Rattle. Without a music director of genius, you do not have a super orchestra however much money there is.

There are vast opportunities before us for arts funding. I notice that today several complaints have been made about the sheer amount of money which the British Library absorbs. I hope that that is a complaint made only in the light of funding that the arts are not receiving in other directions. I confess to a slight connection these days with the British Library because I am now chairman of the National Sound Archive. I foresee that vast opportunities are available on the site of the British Library. I hope that the Government will have the good sense never to sell off those four acres but will use them for good purposes; for example, a multi-media centre. The wonders of computers enable one to call up not merely the catalogue of the library next door but also a file of all the newspapers, and catalogues and, indeed, reproductions of all the great museums of the land. Multi-media is the thing of the future. I can think of nothing more exciting for the 21st century than a multi-media centre that would demonstrate the interlinked nature of all the arts.

There is a hope that the film industry may at last attract a decent share of arts funding. It has been very much the Cinderella of the arts world for many years. The noble Lord, Lord Donoughue, mentioned that Elstree is to close. Only the other day a letter was received from Steven Spielberg, who is surely one of the most imaginative and successful film producers ever, saying that he would like to make several more films at Elstree Studios. It would be ironic if he came to make those films and found that the studios were closed.

As all noble Lords have pointed out, it is a tragedy that so many people will suffer from cuts to arts funding. Many noble Lords have mentioned English National Opera, and rightly so, because no organisation has done more to remove the quite unnecessary and inaccurate curse of elitism from opera. Opera never was elitist; it was always very expensive and will remain so. But English National Opera has really brought it within the reach of many people in a way that no other company that I can think of has done. It is not just the great companies, it is also hundreds of small theatres, dance companies and music groups all around the country which will suffer.

Almost more dangerous is what training and education are suffering at present. For example, it is notable that local authority grants to young people about to train—whether in performance or technique or in acting schools, music schools, dance schools or technical schools—are discretionary. Goodness knows, they look discretionary when one looks around the country. The imbalance of funding for young people from the local authorities of this country is quite astonishing. One really has to decide at birth where one is to live if one's education is to be decently funded. Somehow that situation must be remedied. If it is not, we shall not have the arts in the future in the flourishing state we have them today. The new young practitioners of the arts will simply not be there.

Finally I turn to the lottery. It is something to which we all look forward with such excitement. It is not yet a perfect lottery. I could have wished that it did not rely quite so much on the profit motive. More importantly, I could also have wished to see the Treasury offer matching funds to respond to the excitement of the lottery instead of diminishing it by lopping 12 per cent. off it in tax. Perhaps such things are past praying for, though I hope not. At all events, great things will no doubt come out of it.

I notice that the noble Lord, Lord Crickhowell, was worried that the exclusive nature of the lottery's capital funding might be damaging. I have always believed—and I very much hope that the Minister will confirm this in her response—that, although it is intended that the funds shall go to capital funding, in the event of new endeavours, endowment funding to put alongside the capital funding is permissible. Indeed, I suspect that that principle would be essential for an organisation which also grew dramatically. As the noble Lord said, it is pointless to have new or enhanced facilities of one sort or another if revenue funding cannot then be obtained. The Arts Council will surely be in the position of saying, "We can scarcely deal with the clients we have, so we cannot handle any new ones".

I am sure that that endowment principle must somehow be built into the lottery. I can think of one instance in that respect, and I declare an interest in it immediately. I have in mind Shakespeare's Globe Theatre. It now rests under the shadow of the recent death of Sam Wanamaker, who laboured for over two decades to bring the development to fruition. Indeed, if one looks at Southwark now, one can see that half the bays of the theatre are there. Shakespeare's Globe Theatre is arising. It is not, I believe, an act of piety; it is an act of renewal, excitement and discovery. There is one aspect of the greatest of all our dramatists about which we have no idea: how he must have felt in his own theatre. We have no clue as to where he started from. We have seen hundreds and thousands of productions of all his plays, but we do not know about his point of departure. However, soon we shall. It will be a tribute to Sam Wanamaker, and, I hope, a tribute to this nation to see the theatre arise. If any endeavour deserves a good whack of the lottery funds—and it has received not a penny of public subsidy thus far—surely it is the Globe Theatre in memory not only of Sam Wanamaker but also of our greatest dramatist.

5.54 p.m.

Baroness Fisher of Rednal

My Lords, many speakers have stated this afternoon that they were the chairman of an organisation or the member of a committee concerned with dance activities, and so on. However, I can honestly say that I have never been fortunate enough to be chosen for any of those illustrious positions. If I recall correctly, I took drama when I was at school and we put on a performance of "Macbeth". I thought that I should play Macbeth, but I was given the task of being one of the witches. Indeed, it was a very small part. Therefore, my knowledge and, perhaps, my fame do not lie in that direction.

I should like to talk specifically about Birmingham. No doubt some Members of the House will say, "Yes, we thought you would". My noble friend Lord Howell and I started together in politics. He started a little earlier than myself when he was elected to the city council; but, nevertheless, we were both colleagues on that council and then neighbouring Members of Parliament, though my noble friend has a longer service in Parliament.

By maintaining a network of what we call prestigious arts organisations, such as The Royal Ballet, the City of Birmingham Orchestra and the Birmingham Rep., and by putting its money into such arts, Birmingham has achieved a high profile on the international stage. That, in turn, makes Birmingham a much more attractive place in which to live and work. But, most importantly—not only for Birmingham citizens but also for the welfare of the country—it encourages inward investment in the locality. It is not just the people who live in Birmingham who benefit from our theatres and our art galleries. The people living in the wide area of what we call the West Midlands region can also benefit.

Within the last month the exhibition of all the Canaletto pictures came to an end. Some of the pictures were lent by Her Majesty the Queen. I can recall the absolutely shattering attendance at the gallery. Crowds of people queued up every day to view the exhibition and the extension of the exhibition had to be continued for two extra weeks. Incidentally, it was not a free exhibition; one had to pay to get in.

In providing support for prestigious involvement in the arts, the council also asks such organisations for help as regards payment for pensioners, those who are unwaged and the disabled. In other words, such organisations are asked to give something back for the benefit of the people. Further, part of the funding goes towards visits in schools. I am glad to see that the noble Lord, Lord Menuhin, is back in his place. I must say that I enjoyed his speech this afternoon.

I can remember very clearly when a member of the City of Birmingham Orchestra came to visit a school for children with learning difficulties of which I am a governor. The man started to play the violin. All 10 of the children present gazed at him as if struck by magic. When asked by the teacher afterwards what he thought about it, one of the children said, "That man made that fiddle talk". I thought that that was a wonderful expression for a child with learning difficulties to use. He certainly got something out of that violin music.

It seems to me that many people have much more ambitious ideas about what will happen to the national lottery funds than I have. Indeed, I am very sceptical about the lottery. To be quite truthful, I believe that it is another Government wheeze. What we get in one hand they will take away with the other. That is the natural run of things. We shall never get any more. It is just like something out of a Dickens' story: you ask for more, but it is not forthcoming. Therefore, all the optimism which we have heard this afternoon does not reflect my view.

I should like to support the noble Lord, Lord Bonham-Carter, who spoke about the National Library. As regards the Albert Memorial, the mind boggles to think how much the Government have spent in shoring it up over the past three or four years. It must have cost about £5 million. Moreover, it is now suggested that we should spend another £11 million on a crumbling monument. I believe that Queen Victoria did not care for it greatly when it was proposed. I suggest that the £11 million I have mentioned would be better spent on crumbling Victorian schools than on crumbling Victorian statues.

It is unfortunate that the education cuts, especially the cuts in the funding of school orchestras and orchestral instruments, are having a serious effect upon school orchestras. The provision of musical instruments is not a top priority in the budgets of many schools. However, if we do not encourage the study of music in our schools, in the long term we may lose potential performers. I wish to mention specifically the cut in project funding. Project funding helps smaller organisations. Often it constitutes the first rung on the ladder for new actors, writers and designers. In the long run we shall lose the talents of those people through cutting project funding and that will threaten future artistic development.

I thank noble Lords opposite for nodding at me. I am keeping my eye on the time. Like other noble Lords, I believe that the live arts are labour intensive and income generating. They also provide a rich culture. The most important factor is the enjoyment we derive from that culture. We must ensure that we pass on that heritage to the younger generation.

6.2 p.m.

Viscount Mersey

My Lords, I wish to thank the noble Lord, Lord Donoughue, for introducing this debate. It was a rare privilege also to hear the maiden speech of the noble Lord, Lord Menuhin, and indeed of my noble kinsman the Duke of Saint Albans.

I would like to concentrate on the funding of the musicians of the future: of the young people in our conservatoires in general, and in our oldest Conservatoire in particular. I refer to the Royal Academy of Music. I will tell your Lordships how London is still managing to maintain its position as the music capital of the world by a series of bold and imaginative initiatives; but I regret that this is more despite Government funding than because of it. The three Government funded conservatoires in London are the academy, the college and Trinity. Compared with La Villette in France or the Juliard in America they are very small both in their amount of grant and in their numbers of students. It was for those reasons that my noble friend Lord Gowrie suggested some years back that the three should combine, and hinted that should they do so a larger grant would be forthcoming.

The combination has worked up to a point. There is now a vocal faculty shared by both the academy and the college. However, tentative moves to run a combined early music course have met with the response that there is no more money available. This is not, therefore, a major success. I mention it only to contrast it with a success which is rather big. I believe that it is unique in Europe. It is a collaboration that has grown up between the Royal Academy of Music and King's College London on a new Bachelor of Music course.

Noble Lords will know of the common criticism levelled against musical training, which is that if you read music at a conservatoire you learn how to perform but you do not learn about the academic side of music; that is, its history, its development or its nature. Conversely, should you read music at, say, Jesus College, Cambridge, you come out strong on theory but weak on performance. There just are not enough good orchestras in Cambridge, or indeed Oxford, to give students a chance to develop their playing. So now for the first time we have the best of both worlds—an academic performance course. For instance, a bassoonist on such a course could also learn about counterpoint and Gregorian Chant. However, he could go wider still. He could also be reading Thomas Hardy, or philosophy, or even business studies. This is a remarkable spin-off from the original Gowrie concept. However, it is not the spin-off that was envisaged. It is something different and altogether more exciting. There is nothing else in Europe today that is anything like this Bachelor of Music degree.

As regards the funding of the Royal Academy, one only has to look at the back page of the brochure entitled The Development of Excellence to see the extent to which the academy has gone out into the market place. Abbey National, the Laura Ashley Foundation, Baring Brothers, Coutts, Marks and Spencer, Ciba-Geigy, and Guinness are mentioned. I could go on. I would single out Industrial Distillers and Vintners who fund all chamber music activities. I must mention also, as a slightly lighter aside, a gift from the Kuwaiti Ambassador to Indonesia given on condition that the academy performs a piece that he has himself composed entitled "Liberation". I gather it is a 20 minute sand dance. My noble friend may remember such numbers from her music hall days.

Most sponsors give with no strings attached. For example they have funded a £2 million refurbishment of the Duke's Hall. They support individual students who would otherwise be unable to come to the academy. In addition, British Telecom and Toyota sponsored the visit of the academy's sinfonietta to Tokyo: the Steel Charitable Trust has been paying for master classes and Thorn EMI has installed a recording studio. All of this private sponsorship is the result of considerable efforts by the academy's managing director, Peter Madams and the director of commercial activities, Peter Shellard.

But having criticised the Government I must also give them credit where credit is due because six years ago it would have been largely pointless to raise this private money as the grant would have been reduced by a similar amount. The academy was then on deficit financing. With the 1988 Education Reform Act all that changed. Now what you raise you keep. Doubtless that has encouraged the academy's fund raisers to achieve such magnificent results.

I am in danger of giving the impression that everything in the garden is lovely. However, that is far from being so. The academy is clinging on by the skin of its teeth. The Government grant has been frozen for the past two years. In real terms it has therefore declined. Student accommodation is now paid for rather reluctantly by local authorities. In some cases it is means tested. But the biggest difficulty is the changeover from grant to loan for the individual student. I am in sympathy with the broad reasoning behind student loans, which is that those with a good tertiary education should earn more than those without it, and should therefore be in a position to pay the grant back when they get jobs. However, musicians do not make a lot of money. Ordinary orchestral players are far from being plutocrats. They earn £60 for an evening performance and that is not the sort of amount that will leave you with a fistful of fivers to repay your student loan. This is a difficult problem. The student loan principle is sound in general, but there are those students who have chosen careers which are artistically rewarding but which are also near guaranteed to ensure poverty, and musicians are among them.

I would therefore ask Government to give grants not loans to those studying classical music. I noted that the noble Lord, Lord Eatwell, asked for much the same concession for students of dance. In addition, I have one very specific suggestion that would help both the academy and Kings. Both of them need a physical focus for their Bachelor of Music course. They need a building; and there is one midway between the academy and the British Library. It is an elegant structure called the Diorama. Could not the Government buy this building and give it jointly to the academy and Kings? They would call it the Centre for Advanced Performance Studies (or CAPS). In that way the Government would continue the good work which they started with the Education Reform Act 1988.

6.9 p.m.

Baroness Gould of Potternewton

My Lords, I appreciate that in the course of the debate a number of noble Lords have referred to the importance of the arts to the economy of the country. Therefore, I shall not repeat the many figures that have been presented in the debate. However, they show clearly that any reduction in government subsidy is not only culturally, but also economically, short-sighted. While, as has been said, other European countries have been generous, real cuts have been imposed in Conservative Britain. That is not to suggest that one relies only on the Government to fund the arts. Obviously there are other sources, but the Government must take the prime responsibility.

It was the late Baroness Lee, the first Minister for the Arts, who stated that the industrial patron was the heir to the virtually extinct wealthy private patron of the past and that she looked to industry and commerce to play their part in ensuring that the arts were made more widely available. That view has become even more relevant with the increase in leisure time and cultural activities as part of the social infrastructure.

It is true that neither central government nor local government can nor should be the sole financial provider. There have to be essential degrees of interdependence between the commercial and subsidised sectors and the democratic control and widening of access to the arts. That does not accord with the statement made by the then Arts Minister, Richard Luce, who told the regional arts associations, as they were then, that they had to be weaned away from the welfare state mentality—whatever that is. He added: My vision for the millennium is for private patronage to match or even outstrip public patronage". That meant either an enormous growth in sponsorship or a severe cut in public funding. However, it seemed ludicrous to suggest that sufficient private funding could be obtained to pay for the arts. The record shows that that is not the case. There has been some growth in private funding, but it has been nothing like as much as anticipated.

Public subsidy is seven times greater than the amount contributed by sponsors, even though the Government's publicity devised to encourage firms to sponsor the arts states: Sponsorship is a payment by a business firm…for the purpose of promoting its name, products or services; it is a commercial deal not a philanthropic gift". If such sponsorship comes out of the advertising budget it can be set against taxation. In the words of the Inland Revenue, it is money spent wholly and exclusively for the purpose of trade.

In many cases sponsorship has now become advertising. As a consequence it is often of a short duration. It creates uncertainty for arts organisers attempting to plan long-term ventures. The Secretary-General of the Arts Council summed up the position when he said that sponsotrship comes and goes. Its coming and going, however, is determined not by the needs of the arts organisation, but by the wishes of the sponsor.

That is not to condemn sponsorship—just the reverse. But the Government's view of sponsorship as an alternative to public funding goes far beyond that of the present Director General of the ABSA, who made it clear that the ABSA did not want to do the Government's job and that the Government's job was funding the arts.

That uncertainty about future funding is particularly felt by the regional arts boards. In the present economic climate more and more of their time is spent on fund-raising activities. There are five negative factors which strengthen that need: the decline in box office takings as a consequence of the recession; the reduction in central government support finance; the Government cuts on local authorities, which will inevitably mean cuts in their donations to arts organisations; a decline of 13 per cent. in 1992–93 in private sector sponsorship; and a reduction in available trust funds.

Arts organisations feel that the time and resources that they have to devote to fund-raising would be better spent in doing the job that they are committed to doing. To quote Julian Spalding, Director of Glasgow Museums and Art Galleries, they were scampering about, raising money from companies with large promotional budgets …and having no time left to develop the heart of what they do". That is all the more reason why praise must be given to the dedication, commitment and enthusiasm of those who work in the regional arts. The regional arts hoards, in partnership with local authorities, have made considerable achievements, particularly in the extension of cultural access, ethnic involvement and the participation of young people.

As in other regions, in my own area—Yorkshire and Humberside—there is throughout the whole region an exceptional diversity and wealth of artistic activity. There are nearly 300 performing arts venues, more than 150 art galleries, more than 70 professional theatre companies, six building-based producing companies, and an extensive range of receiving theatres featuring touring companies and local productions. They include the Leeds Grand Theatre where in the early 1970s I was a local authority member of the board and remember the delight and excitement we felt when it received the Arts Council grant which enabled it to become the home of the internationally acclaimed Opera North, whose attendances are the highest in the country outside London. A new theatre is to be opened in Huddersfield in 1994, and there are two outstanding dance centres—the Northern School of Contemporary Dance and the Yorkshire Dance Centre. There are at least 66 arts and cultural festivals, including the Leeds West Indian Carnival which is held in my old playground—Potternewton Park. However, it seems to me that by their actions the Government are putting all those magnificent achievements and the arts and cultural life of the region at risk.

Further, the line of accountability which the Government now draw between the regional arts boards, the Arts Council and themselves is, I fear, to be used to centralise policy control. That can have two consequences. It can become harder for the boards to co-operate constructively and flexibly with local authorities, and policy can become increasingly influenced and budgets constrained by centralised priorities. That view is strengthened by the Secretary of State taking it upon himself to choose and appoint the chairs of the boards.

It is equally true that the growth of a free market economy in the arts, as perceived by the Government, cannot provide for the necessary social and cultural facilities on a sufficiently wide basis. Cuts in public funding inevitably mean a cut in the range of options that should be available.

We need to see the provision of arts as a statutory duty on local authorities, regional arts boards made more democratically accountable locally and being allowed to appoint their own chair; the encouragement of more private industrial and commercial support for the arts outside the metropolitan area, and the restoration of the central and local government revenue funding in real terms. Only then will the regional boards be able to balance and continue to provide for the needs of both the taxpayer and the artist.

6.12 p.m.

Lord Rix

My Lords, I am delighted that the noble Lord, Lord Donoughue, has instituted this debate on the funding of the arts for it gives me the chance to add my voice—the 23rd, as it happens—to those trying to persuade the Government to put the arts a little higher on their list of priorities. I wish to associate myself with many of the remarks made by my noble friend Lord Palumbo on the vagaries of arts funding generally. Some of your Lordships may remember that that was the root cause of my resignation from the Arts Council last summer. However, I have no desire to boil old potatoes, for that is a stale and fruitless exercise.

I also wish to say that I am more in sympathy with the remarks of the noble Baroness, Lady Hilton, than those of my noble friend Lady O'Cathain. Many an ugly duckling in the arts has become a glorious swan, but no one is helped if the pond of financial support is frozen over.

Ever since that Greek poet, Thespis, left subsidised Athenian theatre and pushed his actors round on a cart, thus beginning the long history of the strolling players, there has always been some form of patronage for drama. The impresarios of the day were successively the clergy, the trade guilds, the aristocracy, the court and then the monarch himself. After that it was the turn of the actor-managers, the commercial managers, the local authorities and the enlightened creation of the independent Arts Council, funded with increasing generosity by successive governments. That was the theory anyway. In practice, it was somewhat different.

Successive governments have funded the Arts Council, but their generosity has been subject to arbitrary cuts, standstills and occasional handouts, according to the prevailing Treasury wind. When complete collapse has threatened, there has been a modest, but much trumpeted, increase in subsidy—never quite making up the erosion of the previous years. When times are hard the subsidy is once again treated as a mere frill and furbelow and trimmed with as much thought as a petticoat might well receive, while the biggest client, the theatre, has suffered accordingly. It is an easy target for, to quote Hamlet, the play, I remember, pleased not the millions; 'twas caviare to the general". After all, there is always the telly to keep boredom at bay, and soon the lottery. At least that will mean that the Government can repair the buildings with some of the proceeds, even if there are not enough performers and plays to keep those theatres from going dark. And what will television drama do then, without its seed bed of live performance?

Live performance in the theatre has often been in jeopardy. But government funding and the Arts Council were supposed to put a stop to all that, or at least to increase the chances of stability. When I first became an actor-manager in 1947, the theatre was still picking itself up from the detritus of war. Commercial theatre was all, with a few non-profit distributing companies, as they were known, helped by the embryonic Arts Council sending out small-scale tours. The rest was the apogee of the West End, the often unsuitable small cast productions in vast, privately owned touring theatres and, with a few notable exceptions, weekly rep in the smaller towns, often twice nightly. Such venues provided many an actor with his basic training. I spent three years in such mind-boggling work. Your Lordships should try learning John Tanner in Man and Superman in five days. But at least we grasped the fundamentals even if we did not grasp the lines.

The Arts Council gradually burgeoned, local authorities began to buy up the crumbling theatres for tours and constructed others to house excellent short-run repertory; theatre in education and youth theatre became a staple feature of growing up; new writers were encouraged, as were large, medium and small-scale touring companies; the Royal National Theatre and the Royal Shakespeare Company in London came into being, and, fairly recently, the aspirations of disabled people and their involvement in the theatre began to be addressed. From that splendid list you might think that the Government had no need to reproach themselves: "You might think that; I couldn't possibly comment". Why? —quite simply because there has been no sensible, steadfast funding policy for the arts and subsidised theatre over the past 20-odd years, and now the Government hold forth on the benefits of sponsorship and the need for local authority support. That is absolutely true, but why should commercial sponsors and local authorities be interested when the public subsidy rug is liable to be pulled away from under the feet of arts organisations with a joyous abandon which would do credit to Joey Grimaldi himself?

The chairman of the Royal Shakespeare Company, Sir Geoffrey Cass, comments, British theatre is the envy of the world, and there is a remarkable and fruitful cross-fertilisation between the subsidised and the commercial sectors. The subsidised sector is crucially important, and the United Kingdom has a unique network of regional theatres upon which the health of the RSC and the RNT and all other theatre depends. But each of those theatres in its own way is suffering the same problems as the great flagship companies; an inadequate and capricious funding policy which observes neither cultural nor business principles. There seems to be a complete lack of governmental corporate memory". So says the chairman of the RSC from the Barbican and Stratford-on-Avon. What says Philip Hedley, the director of that other Stratford, this one at the Theatre Royal at Stratford East? The two major planks of the Arts Council Royal Charter are the need to support the artists in their work and the need to make the arts accessible to the broadest possible cross-section of the community. Both planks are being hacked at by government policies". Mr. Hedley then goes on to point out that problems begin with education, that drama is no longer a vital part of the school curriculum and, coupled with local authority cuts, this could ensure the demise of theatre in education and children's theatre companies within two years.

Local theatres too will suffer, for there is no support for school visits, as will our highly respected drama schools, with prospective students depending as much on geography as on talent, as we have already heard from my noble friend Lord Birkett, because so many authorities are not able or willing to give grants to student actors and dancers. Without such training for artists, there is little hope that our pre-eminence in the theatre can be maintained.

Finally, on disability, a disabled person wishing to enter the theatre as a member of the audience or as a member of the company is often denied access by being met with a variety of excuses, while training for such employment is virtually non-existent. The Arts Council began to address the issue in my time, and I believe continues to do so under the chairmanship of my noble friend Lord Snowdon. I trust that Her Majesty's Government will continue to give that valuable initiative all possible support. John Earl, the director of the Theatres Trust, assures me that the trust will play its pad in making access available both back and front of house, as will the Society of London Theatres and the Theatrical Management Association. At least that is one crew all rowing in the same direction.

We still have a number of splendid (sometimes splendidly tatty) theatres. We have immensely talented playwrights, actors, actresses, directors, designers, producers, technicians and administrators. Unhappily, their lot is often no better than the actor in. the last century who wrote: Who but one haunted by a restless burning desire for dramatic distinction would welcome years of poverty, privation, sickness of soul and body, a constant sense of self-imposed beggary". We stand at the gate of the 21st century. Surely such poverty should not accompany the arts into the millennium (whenever that is) and beyond.

6.17 p.m.

Lord Plant of Highfield

My Lords, that is a rather difficult speech to follow. I remember that the very first theatrical experience I had was seeing the noble Lord, Lord Rix, in a performance of "Dry Rot" at the Whitehall Theatre in the early 1950s.

I wish to spend most, if not all, of my speech discussing some of the principles on which state funding of the arts might be thought to rest. Noble Lords may think this a rather arcane and philosophical issue to raise, since no one is proposing to remove state funding for the arts. However, it is important to figure out the political basis for state funding. There are people, economic liberals in particular, scattered around the think-tanks who keep up a constant criticism of state funding for the arts. In recent months, various Treasury Ministers—in particular Mr. Dorrell and Mr. Portillo—have been arguing for a more limited role for the state. Mr. Dorrell spoke about the state not doing things that the private sector, whether the market or the voluntary sector, could do equally well, so why should the state support the arts, or, to put it another way, why should the state support the private preferences of individuals? Why should it subsidise them? Why should one set of taxpayers subsidise the subjective private preferences of another set of taxpayers? That is the crucial issue to address. I shall say a few words about that, although it is a large topic to deal with in a short space of time.

Broadly speaking, there are two responses to the challenge, "Why should the state subsidise one set of preferences?". The first is an economic response. We have heard some of that reasoning this afternoon. The other is more idealistic.

The economic response falls into two parts. The first is the claim made by some political theorists and economists, and most recently by John Gray—an important Conservative political thinker—that in fact culture is a public good in the economist's sense of that word. That is to say, a public good is a good that requires collaborative production but from which you cannot exclude non-contributors. It will therefore not be produced by a market, since, if you cannot exclude non-contributors, everyone has an incentive not to contribute. So public goods are paradigmatically goods like defence and clean air. They cannot be produced by markets because every individual has an incentive not to contribute to the costs since he or she cannot be excluded from the benefits. One claim is that culture is a public good in that sense and even economic liberals who want the most limited state possible argue in favour of the public funding of public goods.

Is culture a public good? In one sense it is and in another it is not. Culture is a little like language: we are born into a particular cultural context, we learn a particular culture, we operate within it, we derive an identity, both personal and national, from it. In that sense, it is a public good because one cannot exclude people from it.

In another respect culture, and particularly cultural events, is unlike public goods in that it is perfectly possible, and usually happens, that people can be excluded: namely, they have not got the price of a ticket. So the most one can say is that cultural things are only mixed public goods. They have some aspects of public goods: in some ways they are analogous to a language; in others they are quite different and they look like normal marketed commodities. It might be argued that the mixed nature of culture as a good is best represented by a mixture of funding—state funding, private funding and so forth—because that reflects the complex nature of the kind of good that culture is. That is an important argument.

The second economic response is to say—as has been said by many noble Lords this afternoon—that state expenditure is justified because there are positive spillover effects of cultural activity. It attracts tourists, creates wealth and has beneficial effects on other types of business such as hotels and restaurants. Therefore state funding is justified because of the positive spillover effects.

That argument needs more careful handling than it sometimes receives. The economic liberals will clearly reject it because it does not calculate the opportunity costs of other investments subsidising other preferences which might or might not produce even more beneficial spillover effects. Thus I am not too happy about using that argument in favour of public funding of cultural activities.

The more idealistic approach is the one on which I wish to put most weight. It will be difficult to outline in the two or three minutes remaining to me, but it would go something like this. If we take the view, as many economic liberals do, that choice should be at the centre of our concern, then surely choice is not just a matter of having the capacity for choice; but it is also about having a range of significant alternatives between which one can choose. Choice and culture are linked together; choice is not just the sheer capacity to choose between A and B, it is to have the A and B available in order to choose between them. So one argument for sustaining cultural activity through the state, along with the private sector and voluntary action, is to sustain a range of significant alternatives within which people can choose.

I do not think it works to say: "We must turn culture into a marketable commodity because we must have choice", if the effect of that marketisation of culture is to lead to the diminution of the range of alternatives that people would otherwise have. For example, if opera cannot be turned into a wholly marketable commodity because it is so expensive, that would limit the range of options and therefore limit the range of choice.

It is also important to say that, if we believe—and in a sense this is parallel to the argument going on at the moment about moral values—that there are standards of human excellence, of worthwhileness in human life, which are not just matters of individual choice, then it is wrong to turn those values, whether they are aesthetic or moral values, into entirely market-based values which are a matter of individual subjective preference. If we really believe that there are intrinsic to human life and to human activity certain standards of excellence and worthwhile life, then it is wrong to turn them into wholly marketable commodities. Not all human goods are the same kind; not everything can be comprehended by the market. It is important to recognise a range of different spheres in our lives in which different kinds of values and institutional structures operate. It is because of that pluralism about the nature of human goods that I think we have to recognise that there is an indispensable role for state support for the arts.

6.35 p.m.

Lord Balfour of Inchrye

My Lords, first I should like to thank the noble Lord, Lord Donoughue, for initiating this debate. It is indeed timely because much has occurred in the arts world in the past few years. It also gives us the opportunity of hearing two distinguished maiden speakers.

I hope that my noble friend Lord Menuhin will excuse me if I confine my remarks to music. I have been conversant with the musical scenario in this country for the past 50 years. During this period much has been achieved, foremost being the attainment of a remarkable standard of instrumental playing. The technical competence and the general musicianship of our musicians is admired throughout the world, so much so that our leading orchestras have had no difficulty in attracting a galaxy of international conductors to these shores. The ability of our youth orchestras to tackle what were once considered some of the most difficult scores in the repertory is truly amazing. It accounts for the fact that very often the officials of the European Community Youth Orchestra have been obliged to limit the number of British participants, otherwise more than half the orchestra's personnel would consist of British musicians.

We have produced conductors like Sir Colin Davis, John Eliot Gardiner and Simon Rattle, among others, who enjoy international reputations and have held important posts abroad. A constant stream of fine singers has been produced, many of them emanating from the Principality. On the creative side, a country that can number such composers as Vaughan Williams, Tippett, Britten, Birtwistle and Maxwell Davies can certainly hold its head high. We have much to show in the field of musical scholarship; a notable example being our total upstaging of the French, apropos the complete new edition of the works of Berlioz now under way. All in all, I am sure we have a lot to be proud of, definitely sufficient to dispel once and for all that absurd notion that ours is a "land without music".

But I have considerable misgivings about the future of music in this country. I fear that henceforth my remarks will be in a minor key, as it were. I believe that music is suffering from the effects of a two-pronged attack; the result of changes on the educational front and inadequate funding.

I have just referred to the superb level of instrumental playing which we now witness in Britain. That has come about largely as the result of children in England and Wales having had the opportunity of learning an instrument free of charge. Research has disclosed that almost three-quarters of the players in our orchestras have benefited from that tuition. Now there is a danger that all the good work which has been so meticulously built up over the years may be threatened by recent legislation. More and more schools are no longer able to afford professional teachers while the musical specialist in state schools is rapidly becoming an endangered species. The standard of teaching will inevitably decline if there are fewer children learning music. So, too, will the level of excellence of our youth orchestras and, in turn, that of our domestic symphony orchestras. Where will the players of and the enthusiasts for the great mainstream of Western classical music come from in the future? Heaven forbid that we should end up like America where music in schools is nearly non-existent and where audiences in the concert halls and opera houses grow greyer by the year.

Here in this country, in the past few weeks, we have seen the lamentable fiasco of the Hoffmann Committee and the London Orchestras. It is hardly surprising that that episode has brought forth a torrent of criticism of the Arts Council. Now, like other noble Lords this evening, I confess that I have a degree of sympathy for that much maligned organisation for the simple reason that I think it operates under difficult, well nigh impossible conditions and that we ought to look at the broader picture.

In passing, I congratulate the noble Earl, Lord Gowrie, on his recent appointment and sincerely wish him well. It is my belief that since the last war the arts in this country have been underfunded by all governments. By comparison, as the noble Lord, Lord Donoughue, said, we allot only a proportion of the money that France and Germany receive. At the moment, arts funding here is reaching a point of decline. Central and local state subsidies are gradually receding. I am convinced that we ought to allocate greater sums, but therein lies not only a financial problem but another insidious factor which I think needs stressing.

We live in a harsh economic climate. If the noble Baroness, whose appearances at the Dispatch Box are always so refreshing, were by some miraculous chance to announce a huge increase in the arts budget, both she and the Government would be criticised, if not crucified, in the media and vilified by every philistine in the land. For we must not lose sight of the fact that there are many who would enjoy seeing the collapse of the Arts Council and the ending of all arts funding. Among them are people who consider there is no such thing as quality: nothing is better than anything else and, by extension, no culture is more important than another. They equate a Madonna pop song with a Schubert Lied, a saucy seaside postcard with a Rembrandt drawing, and "Eastenders" or "Neighbours" with, say, a play by Shakespeare or a novel by Dickens. It is an appalling fact that a good deal of current educational thinking of recent years has been along these lines.

What is anathema to such individuals is anything that smacks of élitism. I wholly agree with the former President of the United States, George Bush, who once asked, "What is wrong with élitism if it means excellence?" That is precisely what it does mean. It has nothing to do with social position or snobbery, but everything to do with excellence—a point understood by those Hackney councillors whose foresight in enabling children from one of the most deprived areas of London enter another magical world to see the Prokofiev ballet "Romeo and Juliet" at Covent Garden was so sadly frustrated by the idiotic political correctness of a headmistress. I echo the view expressed in a Sunday Telegraph editorial following the James Bulger murder that all concerned in this terrible case should campaign against what it called "the revoltingly low standards of popular entertainment". Therefore, I consider élitism not as an objection but as an objective.

I should like to put forward one further reason for treating the arts with a degree of generosity, even in these times. Some years ago an article appeared in The Listener—a magazine whose demise I greatly regret—under the name of Mr. Harold Wilson, as he was then: now, of course, the noble Lord, Lord Wilson of Rievaulx. He argued that in future we would have more time for leisure as a result of technical inventions. What has happened is that fewer and fewer people are working longer and longer. Unfortunately, in one way the noble Lord was absolutely right. There are many more people with time for leisurely pursuits; namely, the unemployed. I am sure we shall not experience full employment in our country, or at least not in the foreseeable future. There will be many with vacant lives and vacant time, but must they therefore have vacant minds? Many will see no hope but to turn to drink, drugs and crime. Is it not possible that some of these unfortunate individuals might perhaps enjoy a happier and more rewarding existence if they were to be acquainted with some form of artistic activity? As Sir Peter Maxwell Davies has succinctly put it: A child gripped by music is one less child on the streets". I shall conclude with some resounding words of Ralph Vaughan Williams: Music is not just a tickling of the ear, but an expression of a vision through magic casements of the eternal verities. I fear that as a consequence of current educational heresies and financial cutbacks in future fewer of our citizens will be vouchsafed a glimpse of this vision.

6.43 p.m.

Lord Haskel

My Lords, many noble Lords have spoken about the importance of the arts in enhancing the quality of life in our country. I agree wholeheartedly with their words. I would particularly like to congratulate the noble Lord, Lord Menuhin, for his uplifting speech and also to congratulate the noble Duke, the Duke of Saint Albans, on his maiden speech. The cultural life of our country is something about which we can all feel proud, and we should be grateful to my noble friend Lord Donoughue for moving this debate.

It is because of my business background and past chairmanship of a concerts society that I would like to speak about business sponsorship and the arts, having had experience both as a giver and as a receiver. I would like to speak about the extent of business sponsorship, its benefits and its shortcomings, and to make two modest but I think helpful proposals on the basis of my experience.

First, the extent of business sponsorship: out of a total public arts budget of £631 million in 1992–93, £253 million came from central government; £321 million from local authorities, who have a proud record of supporting the arts; and £57.7 million from business sponsorship. The business sponsorship was down from £65.5 million in 1991–92. This was a disappointing drop, but it still demonstrates the commitment that business has to the arts. This contribution by business is pump-primed by a helpful grant from the Government to the Business Sponsorship Incentive Scheme of £4.8 million in 1992–93.

Business, therefore, makes an important contribution to the arts, and rightly so, because most people in business are genuinely pleased to be able to contribute towards the nation's cultural heritage. And there are benefits to business. Sponsorship is certainly cost-effective, and companies can help their image and raise their profile by being associated with prestigious arts events. They become better known and better liked. An active local cultural environment helps companies retain key local staff, and property companies have been known to sponsor a local arts project to help popularise and fill a development in the area. Arts organisations, too, benefit from their association with business. They get money, and some management skills from business rub off on to the arts organisation. The community also benefits. For example, Nestle's sponsorship of the London Mozart Players means that they perform in local schools, hospitals and old people's homes, and they are able to give master classes for local amateur musicians.

This is all very well as long as there is a sense of partnership and adequate arts funding. But there is a suspicion that the Government see sponsorship as a replacement for funding. This is dangerous because it radically alters the relationships and emphasises the drawbacks. The major drawbacks are that business sponsorship is usually short term and very selective. It is short term because in times of recession or business difficulties arts sponsorship is one of the first costs to be cut. Also, most businesses like to change their sponsorship fairly frequently because the PR becomes stale. Fresh sponsorship is news. Because of that, the commitment is rarely for more than two years and only the top half-dozen arts organisations in this country can rely on sponsorship deals for longer than that period.

The danger for the arts organisations relying too heavily on sponsorship is that they often have to book artists and venues up to two years in advance, and that is usually before the sponsorship deal is signed. As well as the risk, it makes it difficult to plan. Sponsorship is selective, because companies favour well-known arts organisations and venues. As a result, much sponsorship seems to be focused on London, and smaller organisations in the regions are overlooked. However, while researching this speech, several people mentioned to me that it is now becoming more difficult to persuade guests to attend arts functions in London because more and more people find it unpleasant and difficult to travel in central London during the evenings. Perhaps the opening of ABSA offices in the regions is having an impact but, even so, a third or more of sponsorship will still be London based.

Also, sponsorship often depends on the personal whim of one or two senior company managers or directors, usually in the marketing department. A new marketing director often means a review of sponsorship. All this adds to the risk. It is because of these risks that I would make my first proposal. The Government should declare their intention that sponsorship should be limited to 10 per cent. of the total arts budget and that individual arts organisations should be discouraged from having more than 25 per cent. of their budget provided from sponsorship. Within stated limits, sponsorship money will be matched to maintain these ratios. I am not asking for more money, but just more effective management. That would demonstrate to business the Government's commitment to the arts and would encourage business to continue sponsorship by reducing the worry that arts organisations will become dependent on their sponsorship for their financial security. It is important that the risk of collapse by arts organisations if sponsorship is withdrawn should be minimised because that results in a total waste of funds. It also eliminates the excessive dependency of arts organisations on important sponsors. As noble Lords may have observed in another context, a dependency culture is both unhealthy and undesirable.

My second proposal is also modest, but much in keeping with current thinking about deregulation and cutting red tape. It concerns the tax aspect of sponsorship. The noble Lord, Lord Skidelsky, referred to it, as did my noble friend Lady Gould. With so many decisions in business based on tax considerations, it would be nice to remove one. Some noble Lords may be surprised to learn that when company executives attend arts occasions at the expense of their company, they are in fact hard at work persuading overseas clients to buy their products—otherwise the cost would not be tax deductible. I say that only partly in jest because company executives pay a great deal of care and attention when arts events are being used to promote their businesses. When firms sponsor an arts event, for it to be tax allowable they must show that it is done for advertising or promotion purposes.

That is why sponsors and arts organisations spend a lot of time, money and ingenuity converting sponsorship into advertising. As a result we have those endless souvenir brochures full of useless advertising—often by the sponsor's suppliers. Unfortunately, every tax inspector in the country seems to interpret that differently and there are great inconsistencies as to what is and is not allowed. In addition, different Customs and Excise officers take varying views on the position of VAT on "sponsorship in kind". Could not all that charade be avoided by simply relaxing the tax legislation to make arts sponsorship the acid test rather than advertising? The effort and expense could be better used in the arts project itself.

Arts organisations have to compete extremely hard for business sponsorship, not only because there are many other pressures on business for their funds, but also because other organisations are competing for sponsorship. My proposals of a simplified and consistent tax regime, together with a financing arrangement which ensures that arts organisations do not become dependent on business, will help to encourage the arts, which is an end that we all wish to achieve.

6.52 p.m.

Baroness Flather

My Lords, I too believe that the arts are the lifeblood of our country. Artistic activity enlivens all our lives, and all sections of society have a role in contributing to its well-being, be it the state, the community, local government or private sector. Each of us also has a responsibility as individuals, whether we participate or perform or are simply part of the audience.

As has already been said, Britain has an unrivalled record in this field, something of which we can be justly proud. We must continue to maintain and sustain that record. In recent years a new element has been added; there has been a blossoming of arts activity from the minority communities. To speak of Britain's multicultural society is not to be politically correct; it is simply to state a fact. It is vibrant and alive in its artistic and cultural diversity. But it needs to be nurtured and encouraged to contribute to the mainstream arts activity. There are already dancers, actors, film-makers and musicians who have created a fusion between the East and the West—Tara Arts theatre company, Shobana Jevasingh's dance group and Meera Syal's new film, "Bhaji on the beach". Some noble Lords may be familiar with onion bhaji; it is not about onion bhaji. "Bhaji" is a term for an older brother. I hope that your Lordships will go to see the film.

This is a particularly exciting time for people like me who have been brought up to see the two cultures as separate entities. Our frontiers are being extended and our lives enriched by this coming together. While the media has been focused on major symphony orchestras, a new national voice for music-making across the board is being launched tomorrow. It is called the "Main Music Agenda". Once again it is an affirmation of unity out of diversity.

Dare I mention the Notting Hill Carnival? The United Kingdom was one of the few countries that did not have its own carnival; it does now. It is extremely popular with tourists from all over the world and draws a huge tourist population from Europe.

I feel privileged to have participated in a debate in which the noble Lord, Lord Menuhin, made his maiden speech. The first time I heard the noble Lord perform was in Bangalore in South India, around 40 years ago. I have never forgotten that wonderful occasion. If I remember correctly, he has a great interest in Indian music.

I welcome the appointment as chairman of the English Arts Council of my noble friend Lord Gowrie, who sadly is not here this afternoon. He has a long track record and is a former Minister of the Arts. I am only sorry that he excluded Vikram Seth's book—A Suitable Boy from the Booker prize list because he felt that it was too long. I am sure that he will bring a badly needed fresh approach to the administration of the Arts Council. I hope that at the same time there will be a fresh look at the funding of minority arts. We all wish to see funding increased in our favourite areas, and many noble Lords spoke about that. I ask for no such increase; only for fairness and equitable distribution of the cake, giving support for artistic merit and excellence alone.

Quite apart from the contemporary theme, there are vast collections of antiquities from the Indian sub-continent in the museums here. As far as I know, there has been no agitation for their return. But it is painful that they are not used or shown due to a lack of space and resources. What a joy the Nehru Gallery is at the Victoria and Albert Museum. It provides a wonderful combination of the popular and specialist. Groups of tourists, schoolchildren and specialists can be seen together any day of the week. The gallery is making an Indian experience come alive, not only for the public in general but also for the young British-born Asians who also need to learn something of their inheritance. The British Museum's exhibition on Hinduism, supported by lectures, is another good initiative.

The quality of this debate underlines the strength of this House. Noble Lords who have spoken here today have brought years of experience and special knowledge to the debate. The arts of the minority communities are thriving. Let us include them in a wider vision of the arts. Let us support them because they are surely worth supporting.

6.58 p.m.

The Earl of Longford

My Lords, I am sure that the noble Baroness, who spoke to us with her usual charm, will agree that there could be no more informative or incisive an opening to the debate than that given by my noble friend Lord Donoughue. I know that the much admired Front Bench Minister will do all she can to reply. Having replied often in the past, I am glad that I am not in her shoes, never having faced a more difficult task than the one that she now faces. However, she has only 20 minutes so she may escape intact.

I propose to speak about one aspect only of the arts; that is, poetry. I say "poetry" rather than "prose". When I asked someone on the telephone this morning for the number of the Poetry Society, they obviously did not understand my use of the word "poetry". However, I am sure your Lordships know what I am talking about when I say "poetry" as opposed to "prose", and that is my topic for the next few minutes.

It was said by Sir Winston Churchill many years ago when he was Home Secretary—a Liberal, of course, in those days—that the civilisation of a country can be judged by the way it treats its prisoners. I am inclined to agree with that formulation, but I would also say that it might be judged by the way that it treats its poets. The question I am posing in these few minutes is whether we are treating our poets as they ought to be treated. It was said of Lord Rosebery, the Liberal Prime Minister, 'who can be seen depicted in one of the corridors of the House, that, if not a poet, he was the stuff that poets delight in.

I do not know the noble Lord, Lord Palumbo, well enough to know whether he is the stuff that poets delight in, but I am quite ready to believe that he is. But at any rate there is no doubt that the noble Earl, Lord Gowrie, the new chairman of the Arts Council, is not only the stuff that poets delight in but is himself a distinguished poet, who delights in poetry. I am quite sure that everyone concerned with poetry is building up great hopes, which I hope will not be cheated, and is becoming positively excited at the thought that the noble Earl, a poet, is to take over the Arts Council.

A few facts about the help given to poetry should be mentioned. Literature receives 0.5 per cent. of the total money spent by the Arts Council and poetry, which is one of the larger, relatively speaking, beneficiaries receives only £145,000 per year. My credentials as a spokesman for poetry might be questioned. I can assure the House that T.S. Eliot was kind enough to ask my wife and me to escort him and his wife to a Buckingham Palace garden party for their first visit there, and so I have some background. Leaving that aside, I have close contact with the Poetry Society, and perhaps the House is aware of what it contributes in the wonderful work it does in the schools, through its magazine and elsewhere. I am proud to be allowed to speak, if unofficially, on the society's behalf today.

Those who are very well versed in the subject may be aware that all has not been well between the Arts Council and the Poetry Society. The Arts Council has, no doubt legitimately, poked its nose into the affairs of the Poetry Society—it is entitled to because it produces money for it—and has not been satisfied. But things are much better now. I am told that relations are far better than they were and I think that the trouble between the Arts Council and the Poetry Society is a thing of the past.

I look to the Government to say clearly, bearing in mind that they have a distinguished poet about to take over the chairmanship of the Arts Council, whether they are prepared to do more for poetry in this country than they have done in the past. If not, they ought to be ashamed of themselves, but I hope that they will give a much kinder answer than that.

7.3 p.m.

Lord Broadbridge

My Lords, in the past, and I am thinking mainly of the 17th, 18th and early 19th centuries, what we have come to call "the arts" were funded by patronage, the patronage of the aristocracy and gentry; and relationships were often very close and supportive. For example, the artist J.M.W. Turner not only sold pictures to the Earl of Egremont but stayed at Petworth for long periods over his patron's lifetime and was treated as a member of the family.

This sort of arrangement was supplemented and latterly substantially replaced by the patronage of the new social classes thrown up by the Industrial Revolution, many of whom made, by any standards, great fortunes and often in new centres such as Birmingham, Manchester and Glasgow. In short they wished to emulate the gentry; indeed to become the gentry. Our own century has seen a progressive shrinking of the gap between the wealthy and the poor. It is an arguable cliché to say that today the rich are getting richer and the poor poorer but, even if true, this is microscopic compared to the general trend of history of which I have spoken. Not many are in a position now to spend the amount of a member of their staff's annual wages on a good dinner. In summary, the great and wealthy patrons of the past are no longer present to command the high ground of support for the arts by their patronage.

But there is another factor. We do still have wealthy people but they have a much wider choice of outlets for their spending and support than their predecessors. For example, they buy yachts, private aircraft and overseas homes, whereas their predecessors, I believe, supported and spent their money mainly on art, architecture, the performing and visual arts, silver and jewellery. Today's grandees are presented with a comparatively much wider range of spending opportunities.

But while the scale of private patronage has greatly diminished, at the same time the breadth and therefore demands of the arts have breathtakingly widened. The 18th century patron did not have the All Singing, All Dancing Gombolan Folk Dancing Ensemble among his options for support. (I confess that I have just made up that group.) As an inevitable result, a great gap in the need for funding and support has arisen, which gets greater as each year passes, largely due to a population with more leisure time.

At the start of the last world war, the question "What are our war aims?" was very much on the minds of many people, as well as of course winning the war itself. In the field of the arts I ask the Minister who is to reply what are our arts aims? A legacy of our imperial and post-imperial past is that we are among the leaders in the arts internationally and arguably the leader in some fields such as drama and music. I believe strongly that a national majority fervently wants us to maintain this position, and quote in support that research shows that currently some 79 per cent. of our citizens attend some form of arts, or "cultural event" broadly defined, annually, and 71 per cent. think that the arts enrich the quality of their lives.

The arts are one of Britain's most successful industries: cultural spending makes up some 5.5 per cent. of all consumer expenditure. If we accept the maintenance of the arts at present levels as a national objective, together with the maintenance of our position among the leaders of the first division internationally, a substitute for the private patronage of the past is not simply desirable but essential. For many years the Government have increasingly taken on this burden, though I prefer to use the word "challenge". But the level of support is as crucial as its existence.

As many speakers have already noted at various levels of outrage, the government appointed vehicle for much of this —the Arts Council—has this year had its financial allocation reduced by 1.7 per cent.—namely, £3.3 million, which is 3.7 per cent. in real terms. That is their first ever cash cut for the arts and seems to contradict the 1992 Conservative Party manifesto to, maintain support for the arts". Further, I understand that a real terms reduction of 10 per cent.—another noble Lord quoted 12 per cent.—over the next four years is widely anticipated. I readily admit that it is difficult to decide what should be spent in absolute terms, but in relative terms Britain per head of population spends only £9.80 on the arts, which is 41 per cent. of West German spending, 46 per cent. of that of France, 56 per cent. of that of Canada and 35 per cent. of that of Sweden.

I turn briefly to a different field to paint an analogy; namely, home heating. We may graphically, as it were, draw a line between living in very warm conditions—such as the Library of this House—to zero degrees centigrade and below. But one cannot simply survive at any point on this graphical line as though existence is a simple gradation and it is hard cheese if it is cold. At a certain low level as we go down there is a sudden and dramatic discontinuity, a collapse of the system. Hypothermia sets in, commonly with side-effects such as death. This is the crucial problem facing the arts in Britain now, especially with the smaller outfits. Financial hypothermia is about to lead to widespread collapse, or, borrowing from John Cleese's celebrated film, "dead parrot syndrome"—but without the humour of his sketch. Financial cutbacks beyond a certain point lead to sudden death in the arts, and many arts organisations are staring this prospect in the face.

Separately from the Arts Council, the situation has been made even worse by other arts supporters also cutting back. The most recent ABSA survey shows a 13.5 per cent. reduction to £57.7 million. Local authorities, which provide much more than the Arts Council, have dropped £2.5 million from the 1992–93 level and £15 million from that of 1991–92. Many believe that the creation of unitary local authorities will worsen this decline, and the proposed national lottery must only contribute to capital and not revenue requirements by obligation.

In conclusion, we find ourselves with one of the world's richest artistic agendas threatened by diminishing support which, make no mistake, will imminently start a savage decline in the level of the arts in Britain. We realistically risk becoming, compared to now, an arts mediocrity with a great past. Is that really what we want? Is that really the best we can do?

7.10 p.m.

Lord Morris of Castle Morris

My Lords, we have had a long and interesting if somewhat one-sided debate. Most of your Lordships seem to have come here today more minded to admonish the Government for their policies and their practice in funding the arts than to praise them. The general air has been one of disapprobation. Indeed, it could be epitomised in the words of that fine poet of Armed Services' life, John Pudney, who wrote, Complaints is many and various". We have heard two splendid maiden speeches, one from the noble Lord, Lord Menuhin, who spoke with unimpeachable authority and, if I may say so, with deep wisdom about the problems of musicians and their audiences and in doing so, "fiddled his way" into the hearts of this House, and the other from the noble Duke, the Duke of Saint Albans, who spoke so calmly and so cogently about the importance of government funding for the arts.

The complaints of so many noble Lords and Baronesses concerned the wide spectrum of the arts. In attempting to sum up the past four hours it may be helpful if I rehearse them by subject rather than by speaker. Many noble Lords spoke about the Arts Council. We, too, on these Benches welcome the appointment of the noble Earl, Lord Gowrie, as chairman of the Arts Council, and I suspect the only other published poet in this House at the present moment—oh no, I beg the noble Baroness's pardon. She is one too. We are a small group.

I have worked with the noble Earl, Lord Gowrie, when he was Minister for the Arts. I can assure the Arts Council that it is in for an exciting future. My noble friend Lord Donoughue argued strongly for the continuation of a reformed Arts Council especially important for its defence of the arm's length principle, as did the noble Lord, Lord Bonham-Carter and the noble Lord, Lord Skidelsky. The noble Lord, Lord Palumbo, showed how successful it has been despite being beleaguered by the Government's ridiculous efficiency demands which have taken up far too much of its time.

The Millenium Fund was mentioned. To my mind the problem was summed up by the noble Lord, Lord Crickhowell, when he said that it was no use building splendid premises for music, theatre and so on if the companies who work in them are starved to death. There is no more to say.

On the question of patronage and sponsorship, these have been mentioned by several noble Lords—that is, by the noble Lord, Lord Broadbridge, just now, and especially by my noble friend Lord Haskel. Encouraging sponsorship is government policy but, as has just been pointed out, sponsorship has declined. We on this side of the House would like to know what the Government are doing about it, as my noble friend Lady Gould said.

Turning to the subject of music, the noble Lord, Lord Crickhowell, pointed out that the highly successful Welsh National Opera must go on being strongly supported. The noble Lord, Lord Thomson of Monifieth, put the urgent case for adequate funding of the ENO and so did the noble Lord, Lord Birkett, and my noble friend Lady Hilton of Eggardon.

Opera has been seriously cut and is dangerously damaged. The noble Lord, Lord Menuhin, reminded us that "music feeds those intangible tangibles" and pleaded for the proper funding of our great British orchestras, as did my noble friends Lord Strabolgi, Lord Howell and Lady Fisher. The work of the Foundation for Sport and the Arts was described by the noble Lord, Lord Brabazon of Tara, and especially its help for music. It is indeed doing vital supportive work. So does a crutch. The noble Viscount, Lord Mersey, described a visionary new course in music education. The noble Lord, Lord Balfour of Inchrye, fears for the future of music in this country, and well he may. No one has defined or defended the Government's policy on music.

Turning to the theatre, fewer noble Lords spoke on this subject, although the noble Lord, Lord Skidelsky, mentioned the excellent arts centre at Warwick University and my noble friend Lady Birk demonstrated the difficulties that local authorities have in funding our superb local and smaller theatres. The noble Lord, Lord Rix, showed that theatres have long been a soft target for government parsimony. The noble Baroness, Lady Flather, told us of the carnival and of the multi-cultural film and theatre which we need so much to support. Again, what is the Government's policy for them?

I turn next to our museums and galleries. My noble friend Lord Donoughue referred to these places as "the national collective memory", and so they are. The noble Lord, Lord Crickhowell, reminded us that he was notably successful in fostering splendid developments in Wales. The noble Lord, Lord Charteris of Amisfield, paid a superb, two-edged, compliment to the Government regarding the funding of the National Heritage Memorial Fund which has done so much for museums. But no one defended the Government's policy on museums which is not surprising because nobody knows the Government's policy for museums and galleries.

Several noble Lords mentioned ballet and dance. Again, my noble friend Lord Donoughue reminded us that countless students have been prevented from taking up places in education establishments because the number of awards has been cut by half. He was eloquently supported by my noble friend Lady Birk and by the wider arguments for dance from my noble friend Lord Eatwell. The noble Lord, Lord Bonham-Carter, could not understand the Government's policy on dance. I hope that he will shortly be enlightened.

My noble friend Lord Donoughue, like my noble friend Lord Plant, made a magisterial survey of the whole field of the arts. There is little for me to add beyond a little fine tuning. Perhaps our debate has had a centre of gravity in London and the South-East. I might redress the balance just a little if I mention the problems of the region I know best, the Principality of Wales, where the old Welsh Arts Council is soon to be reincarnated as the Arts Council of Wales. I can do that because Scotland was very well served by my noble friend Lord Macaulay.

In Wales, despite tremendous developments over the past 20 years, there are major concerns for the future of the arts. Box office and commercial sponsorship are being badly hit by recession. Local government arts funding is under severe pressure and is being cut back by several authorities in Wales. The work of artists in schools is suffering due to local management of schools funding changes. Small arts companies and individual artists cannot market their services to every individual school.

Local government reorganisation is a great potential threat to major arts facilities presently supported by county structure. For example, Theatre Clwyd receives £1.5 million from Clwyd County Council and Wales's Theatre in Education companies are all funded by the LEAs. Welsh National Opera —a flagship company if ever there was one—is suffering from the combined effect of these changes and its income is plummeting. Grant-in-aid to WNO from the Arts Council of Wales will increase in 1994–95, but the touring grant from the Arts Council in England is at a standstill and the company is now having to curtail its activity if it is to remain properly solvent next year. That is a worrying situation at a time of major upheaval and reorganisation. I beg the Government to think again about the level of funding that the Welsh Office should be giving to this new body.

Moving a little wider, the position of local authorities throughout the United Kingdom needs highlighting. Spending on the arts by local authorities is discretionary. Nevertheless, they provide more money for the arts than central government. It is estimated that the total arts spending by local authorities in 1993–94 is £323.2 million whereas government spending was £225.6 million. There is of course considerable regional variation in local authority arts spending. Kensington and Chelsea, for example, spends £3.49p per head whereas West Glamorgan spends a miserable 36p. The noble Baroness, Lady O'Cathain, developed that point.

It is imperative that the Government accept a duty to ensure that an adequate level of cultural activity is incorporated into the new authorities' legal responsibilities, as proposed for Scottish unitary authorities, otherwise the bedrock of local support for arts activity will rapidly be eroded.

As in so many places where the arts and heritage meet, the Department of National Heritage is the object of grave suspicion. I shall take one simple example. After its press release on 22nd December, it appears to many people that the department is trying to alter the rules to bring the notorious statue, Canova's "The Three Graces", within the ambit of the national lottery. The noble Lord, Lord Crathorne, mentioned that. Any question about funding leads Ministers to say, "Oh, wait until the lottery comes", but the lottery will not solve every shortage of funds. In any case, since it is supposed to be additional, normal levels of government funding must be kept up and not held back. As Shakespeare says, in delay there lies no plenty". Finally, I am sorry to have heard so little this afternoon —until my noble friend Lord Longford rose—about government policies for, and funding of, literature. I had hoped that the noble Baroness, Lady James of Holland Park, would be speaking because your Lordships' House has no more persuasive advocate for the written word than she. We in this country have the luck to have produced the finest language in the world and it is not unlikely that it will become the world language. In it, we have created the greatest literature that the world has ever known yet what encouragement, what assistance, do the Government offer to the writers of our own generation? I wait to hear.

My comments do no more than fill a few small gaps. One after another this afternoon your Lordships have arraigned the Government for lack of cohesion, direction and vigour in their present policies and chronic under-funding of the arts. In 1992, the Conservative manifesto promised: We will maintain support for the arts". In December 1993, the Arts Council of England received a cash cut of £3.3 million, equivalent to a cut of £7.1 million in real terms. That indicates a massive failure of government policy. Where are their promises now?

As we now await the Minister's response, I can only end with the words that are often uttered by my noble friend the Opposition Chief Whip from this Front Bench, in his cheerful Geordie voice and usually (quite improperly) from a sedentary position: "Now answer that!"

Lord Graham of Edmonton

Now answer that!

7.22 p.m.

Baroness Trumpington

My Lords, I'll do me best! The noble Lord, Lord Donoughue, has initiated a most interesting and stimulating debate. I feel very stimulated. One expects nothing less when the arts are debated in your Lordships' House, given the range of expertise and experience assembled here. In that context, I join in paying tribute to our two maiden speakers. I turn first to my noble friend the Duke of Saint Albans who I must advise the noble Lord, Lord Charteris, is also the Hereditary Registrar of the Court of Chancery. I hope that his speech will herald a continuing interest in these subjects.

Secondly, I pay tribute to the noble Lord, Lord Menuhin, not only for his speech, but also for his genius and his humanity and generosity in the encouragement he has offered to young musicians for so long through the Yehudi Menuhin School.

There is a degree of expertise in all aspects of the arts within this House that must give me pause in standing to sum up such a wide ranging and expert discussion. It must be shattering for the noble Lord, Lord Palumbo, the head of the Arts Council, to find that he has a sixth Minister, be it ever so humble, standing before him today.

Some of the issues raised this afternoon, such as education matters, which were referred to particularly by the noble Lord, Lord Donoughue, the noble Baroness, Lady Birk, and my noble friend Lord Mersey, are outside the main area of funding for the arts. I will return to these later, but I should say at the outset that my right honourable friend the Secretary of State, while he does not have responsibility for education, is fully aware of the vital importance for the future of our cultural life of proper education in the arts at all levels.

Your Lordships must forgive me if I do not mention all those who have spoken. I have listened carefully to your Lordships. I must advise the noble Earl, Lord Longford, and the noble Lord, Lord Morris, that in my personal capacity I am a devotee of poetry and share their enthusiasm for it. In my official capacity, however, I must again say—and I shall no doubt say it again—that under the arm's-length principle, decisions on the funding of poetry are a matter for the Arts Council. However, I remind the noble Earl that there is a Poets' Corner in Westminster Abbey where composers and others are graciously allowed to lie.

This is an exciting time for the arts in this country. The terms of this debate relate to support for the arts and I would not wish to minimise the vital importance of a soundly based arts economy. But we should also raise our eyes to assess the state of the arts themselves in Britain in 1994. I continue to be amazed by the enormous richness and diversity, not to mention the sheer volume, of the arts in this country. One needs only to look at the weekend press to be staggered by what is on offer in London and the regions. Since the war, we have seen a burgeoning of creative talent and a progressive expansion of the arts infrastructure. For example, there have been established 19 new dance companies, six national dance agencies, 34 new regional theatre companies, and the list goes on. The past 10 years in particular have seen a quite remarkable trend in major capital developments in the arts. We have seen new theatres, such as the West Yorkshire Playhouse, and concert halls such as St. David's Hall in Cardiff, Symphony Hall in Birmingham and Glasgow Royal Concert Hall. There is now a Tate of the North and a Tate St. Ives. More and more people are using their leisure time to go to the opera, visit an art gallery or to become actively involved in the arts through local choirs, operatic societies and drama groups. I was delighted to hear from the noble Baroness, Lady Fisher of Rednal, of the success of the Canaletto exhibition.

If we turn to funding and management of the arts in general, the picture is frankly better than many would lead us to believe, if less good than some would prefer to see. We have all received the figures that were quoted by the noble Lords, Lord Donoughue and Lord Broadbridge, about international comparisons, but it is extremely difficult to make worthwhile comparisons between different countries. In many cases, figures for public subsidy are not available and, where they are, it is not possible to make direct comparisons because of the diversity and definition of funding sources and the activities supported. The figures that were quoted by the noble Lord, Lord Donoughue, were themselves published along with a number of caveats.

My right honourable friend the Secretary of State for National Heritage secured more funding for the Arts Council in the public expenditure settlement than had been expected. He has acted decisively over the past year to ensure a more effective structure and tighter administration for the council. The Crafts Council wall receive additional money for its important work in developing the crafts in Britain. The business sponsorship incentive scheme has been rewarded for its success with additional funding over the next three years. Major businesses, such as Allied Lyons, are seizing the initiative and putting very substantial sums into sponsorship of the arts. Let us, in the words of a once popular song, Accentuate the positive and eliminate the negative". This is a most appropriate moment for a debate on the arts. Like Janus, we are able to face both ways and watch the old receding and the new approaching. It is inevitable that, in a debate such as this one, I should concentrate on the Arts Council. But there are other important supporters of the arts. As has been said, the local authorities are key patrons. One has only to visit the centre of Birmingham 10 see the performing arts and public art together in a magnificent setting. Together, local authorities spend annually much the same as the Arts Council, and sponsorship from the private sector shows directly the confidence of companies in the arts and in the improving economic climate.

The noble Lord, Lord Donoughue, spoke about local authority funding. He quoted examples of individual local authorities' actions. There will always be differences in levels of local authority support for the arts, but overall support from local authorities appears to be holding up well. I hope that they will continue to appreciate what good value the arts represent.

My noble friend Lord Crickhowell asked about paying Arts Council chairmen. There are no plans to offer payment to the chairmen of the Arts Councils of England, Scotland or Wales.

In April this year, the Arts Council of Great Britain will cease to exist, and the Arts Councils of England, Scotland and Wales will take up their separate lives. The noble Lord, Lord Palumbo, who has been such a distinguished chairman since 1989, will step clown and my noble friend Lord Gowrie will become the first chairman of the Arts Council of England. I know that he will read today's Hansard and that he will be grateful for the remarks of kind encouragement that, various noble Lords have made. At the same time, the regional arts boards will take over from the Arts Council responsibility for the funding of 42 more arts organisations.

The noble Lord, Lord Palumbo, said that over the past year or so the Arts Council has undergone a series of reviews, the end of which was announced last November by my right honourable friend the Secretary of State for National Heritage. The noble Lord, Lord Palumbo, made a series of points. The first related to the activities analysis and the response of the DNH; and the second concerned the endless reviews that have taken place over the past five years.

With regard to the first point the noble Lord raised, the activities analysis was an essential part of the process of better focusing Arts Council activities and streamlining them. On the second point, the reviews were aimed to achieve greater delegation of the arts to the regions and to improve efficiency throughout the arts funding system. The noble Lord will be interested to know that my right honourable friend the Secretary of State has now indicated that the process of reviews is at an end.

The outcome of those reviews is that there is common ground on a number of points among the council, Ministers and the wider world. First, the arm's length principle: that is the principle which has governed the relationship between Ministers and the council since it was founded and which keeps the funding of individual arts organisations out of the political arena. It is a slogan that trips easily off the tongue, but a concept which many people, I fear, seem to have difficulty in accepting. I can assure your Lordships that we understand it and adhere to it. It follows therefore that it is not for the Government to seek to intervene in matters of artistic judgment, although there can be occasions when it is right for Ministers to convey to the Arts Council public and political opinion which has been expressed to them.

Secondly, we all want to see the widest possible access to the arts; for example, the Government attach great importance to the work of the council and regional arts boards in encouraging and promoting touring. It is a tremendous privilege to be able to see our great companies performing around the country, and those performances have introduced many people to the delights of drama, opera or dance. Thirdly, the Arts Council accepts that it must be ready to explain more clearly the basis for its decisions.

Fourthly, we need to streamline the system. My right honourable friend the Secretary of State has set the Arts Council a target of gross savings of 8 per cent. in its administration costs in a full year, money which can feed through into support for the arts.

The noble Lord, Lord Donoughue, asked me about the administration costs of art's funding. With regard to the DNH vis é vis the Arts Council and the regional arts boards DNH running costs, first, its initial costs reflect one-off set-up expenses; and, secondly, they are set to fall by over 10 per cent. in real terms in the period to 1996–97. On the Arts Council, the Secretary of State has acted to streamline administrative costs—8 per cent. gross in a full year; and with the regional arts boards the costs will be kept under close view through the planning process. That all adds up to a strong and effective Arts Council, working in a clear and well-structured relationship with government for the good of the arts in Britain.

The noble Lord, Lord Donoughue, is well acquainted with the work of the regional arts boards, and the move to increase delegation of funding responsibilities to the boards reflects the Government's belief that decisions are often best taken close to those who will be affected by those decisions. Support for the arts depends upon the combination of Arts Council, regional arts boards, local authorities and private sector sponsors. Its effectiveness and health are something upon which the Government keep a close eye. The regional arts boards combine local knowledge with a national perspective and have unrivalled expertise in bringing together those different and sometimes disparate parties to form productive and lasting partnerships.

The noble Baroness, Lady Gould, raised two points. One was on the centralisation of policy and the other was on the Secretary of State's appointment of chairmen of regional arts boards. As to the first, the whole thrust of government policy in that area is towards deregulation, not centralisation. On her second point, the Secretary of State's approval for the appointment of chairmen of regional arts boards has been required since the boards were established.

I turn now to funding for the arts, and in particular the level of government support. As I said, there is every reason to be positive about the arts. Our commitment has been amply demonstrated over the years, with significant increases in real terms in the Arts Council's grant-in-aid. Between 1979 and 1993, the real terms increase was some 45 per cent. Against that background, although I understand the concerns expressed by the noble Lord, Lord Palumbo, I do not think it fair for this year's provision to be hailed with criticism. Government funding remains substantial, but subsidy for the arts is a call on the public purse and must be considered alongside all other such calls. Over a year ago, in the 1992 public spending round, in a difficult economic climate, the Government signalled a reduction in Arts Council funding for 1994–95. That is the basis upon which the Arts Council had to plan throughout the past year. Nevertheless, in this year's public spending round, and despite the continuing need to keep a tight rein on public expenditure, we have managed to find more money for the arts than was planned.

The noble Lords, Lord Palumbo and Lord Howell, and the noble Baroness, Lady Fisher of Rednal, all touched on the question of the Albert Memorial which, if I am occasionally allowed to speak personally, I find absolutely super and worthy of repair, but funding for work on the Albert Memorial comes from English Heritage. There is no new money in the DNH's budget for next year, and my right honourable friend is open to suggestions for other sources of funding which will relieve the burden on the taxpayer. But he cannot direct money from the National Lottery to particular projects. I am glad that I got that off my chest!

Against earlier plans, the Arts Council will receive an extra £800,000 in 1994–95, resulting in grant-in-aid of £186 million, and an extra £1.6 million in 1995–96, which will be maintained in 1996–97. In allocating those funds for 1994–95, the council has in the vast majority of cases managed to protect funding for revenue clients. There will be some reduction in the amount of developmental work but regional theatres and the national companies, among others, will receive the same amounts as this year.

The noble Lord, Lord Donoughue and the noble Baroness, Lady Hilton, compared UK Government funding with the levels of private and public funding for the arts in other European countries. As regard sponsorship, Britain is fortunate in having the Association for Business Sponsorship of the Arts, which collects information in the levels of sponsorship while the arts in other European countries benefit from private-sector support. Therefore, it is not possible to assess accurately the level of that support. However, business sponsorship in the UK is well-established and continues to make an increasingly important contribution to the arts economy. Informed observers have suggested that sponsorship in other European countries is not at such an advanced stage of development.

In the past 20 years or so there has been a remarkable increase in business sponsorship of the arts. In 1976, business sponsorship stood at a modest half a million pounds. By 1992–93 business support amounted to some £58 million. Much credit for this steady and significant growth goes to the Association for Business Sponsorship of the Arts, which has developed a pivotal position in business investment in the arts. The Government's own initiative—the Business Sponsorship Initiative Scheme—has also played its part. Established in 1984, the scheme has so far attracted nearly £70 million in new money for the arts; £46.5 million from business sponsors and £22.7 million from government awards.

I say to the noble Lord, Lord Haskel, that the underlying trend remains healthy. In recognition of the success of the business sponsorship incentive scheme the Government are giving an additional £300,000 to the scheme in each of the next three years. I submit to the noble Lord, Lord Strabolgi, that business sponsorship is not declining. This month alone has been the announcement of a splendid new partnership between Allied Lyons and the Royal Shakespeare Company of £3.3 million over the next three years and of BT's new three-year commitment worth over half a million pounds to British orchestras.

The noble Baroness, Lady O'Cathain—who kindly gave me notice of her questions—and the noble Lord, Lord Skidelsky, asked why we cannot have the same system as the Americans. The whole basis of taxation in this country differs totally from that in the USA. When filing tax returns in the USA every single item of expenditure must be shown. Your Lordships will recall the recent brouhaha concerning the amount claimed by President Clinton for the price he quoted for his underpants. I am glad we are spared that system. Different tax systems develop along different lines. The funding of the arts by the USA Government is considerably lower than ours. I remind your Lordships that in the UK those art organisations which are registered charities benefit from the Government's incentive for charitable giving and there are tax benefits for companies whose sponsorship of the arts is a commercial undertaking.

But, as in America, there are also incentives for individual giving. Payroll giving allows a donation to a charity to be deducted from income before tax. Higher-rate taxpayers are able to claim tax relief on covenanted and gift-aid donations, which reduces the cost of the donation by 20 per cent. I am sure that there is considerable scope for promoting the greater use of these measures. Work is already in hand, supported by my right honourable friend the Secretary of State, to see how this might best be done.

For the future, there is the exciting prospect of the national lottery. By early next year this should be providing very significant additional sums on a continuing basis for the arts, sport, heritage, charities and millennium projects. Money for new buildings, for the badly needed refurbishment of existing ones and for new equipment could all come from lottery proceeds. I wish to pay a warm tribute to the work of the Foundation for Sport and the Arts. Since it was established in 1991 it has made 3,725 grants to arts organisations with a total value of over £52 million.

My noble friend Lord Brabazon of Tara advanced the case for an extension of the reduction of the football pool betting levy to ensure the continuation of the foundation beyond 1995. That is being actively considered and will be discussed with both the foundation and the pools promoters before any decision is taken. I know that the foundation has an excellent working relationship with the Arts Council. It will be for the council to consider whether in future it should seek to be paid for the advice that it provides, but I am sure that due note will be taken of my noble friend's remarks.

The annual funding from the Department for Education was raised by the noble Baroness, Lady O'Cathain. To the extent that all good art has an educational value, it is difficult to know where the distinction might be drawn. There are, of course, considerable pressures on public expenditure and it must be for individual departments of state to decide on their own funding priorities. Nevertheless, I will bring the noble Baroness's suggestion to the attention of my right honourable friend the Secretary of State for Education.

I return to the national lottery. It is important to note that the bodies which will distribute the funds—which for the arts will be the Arts Council—will be expert in their fields. After taking whatever further expert advice they need, they will be able to decide on priorities in their own area against which to assess applications. The lottery will be able to fund projects which are important to the nation's quality of life but which do not have first call on public expenditure. I hope that these extra funds will have a real impact on improving the provision of and access to the arts in this country.

I wish to make it crystal clear to the noble Lord, Lord Donoughue, and the noble Baroness, Lady Fisher, that, as the Government have repeatedly stated in Parliament, it is not intended that money from the national lottery will be a substitute for public expenditure. Lottery proceeds will not be brought within control total and we will not make any case-by-case reduction in conventional expenditure programmes to take account of any future lottery awards.

The noble Lord, Lord Birkett, asked whether endowment funding will be allowed under the national lottery. He also commented on the Treasury duty at 12 per cent. In very exceptional cases the endowment funds may be created to ensure future maintenance costs. However, in general distribution bodies will wish to satisfy themselves that capital projects have a viable future with access to revenue funding from other sources. The level of lottery duty has been set in the Finance Act. It is required to offset the loss to the Exchequer created by the diversion of other expenditure which would have been taxed towards the lottery.

The noble Lord, Lord Thomson, asked about the Government's approach to broadcasting. The Government recognise the importance of broadcasting and they accept that the BBC has a great deal of influence in the country through its patronage of the arts. However, the future of the BBC and other broadcasting companies goes beyond the terms of this debate.

The noble Lord, Lord Charteris, and my noble friend Lord Crathorne asked about the National Heritage Memorial Fund. We recognise fully the important role of that fund in protecting the best of our national heritage. The fund will receive £500,000 more than planned in 1994–95 and a further £1 million above the previous planned total in the second year, giving a grant of £8.8 million. We do not intend that lottery funds will substitute for core NHF funding.

I should like to mention "The Three Graces". I should like the noble Lord, Lord Crathorne, to know that the decision on any deferral period for "The Three Graces" will be taken shortly. I note my noble friend's view that "The Three Graces", if retained in this country, should return to Woburn.

The noble Lord, Lord Balfour of Inchrye, asked about alleged reductions in the provision of music teaching in schools. The introduction of local management in schools has resulted in new ways of providing extra-curricular music provision. In many parts of the country new agencies and trusts are working very well and services have increased. That is certainly true of students taking music within the curriculum. Record numbers of pupils are now taking music at GCSE level.

I pay tribute to the work that the noble Lord, Lord Rix, has done over the years. I am glad that the noble Earl, Lord Snowdon, has agreed to chair the latest initiative. Both as a junior Minister, and as the wife of a man who was totally disabled, I much appreciate the work that the noble Lord, Lord Rix, has done.

I look at the vast number of tourists entering this country. Many of them come to the UK for the sole purpose of satisfying their cultural tastes. This country has an enormous wealth of talent. I look at the busloads of people, some elderly, some young and some in wheelchairs, who visit our theatres, concert halls and museums—and those numbers are growing. This country has a magnificent tradition in the arts and it now has a rich and vibrant cultural mix. Moreover, it has a Government and local infrastructure committed to the continuing support of the arts throughout the United Kingdom. I look to the future with optimism.

Lord Donoughue

My Lords, this has been a fascinating and often extremely entertaining debate. I thank all noble Lords who have contributed so impressively and I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.