Individual giving to culture is up while business investment falls, new report shows

Individual giving to culture is up while business investment falls, new report shows

News (UK)

As new Culture Secretary Maria Miller tells arts organisations they will need to turn to philanthropy to keep going and get ‘better at asking than receiving’, a just-published report on Private Investment in Culture 2010 / 11 from Arts & Business shows that individuals and Trusts and Foundations are already ramping up their support.

The new report has a whiff of the curate’s egg about it, showing that though private sector investment in the arts rose to £686.6m in 2010/11, around 4% higher than in 2009/10, business investment in the arts is down for the fourth successive year, falling to £134.2m in 2010/11 down from £144.1m in 2009/10 and a peak of £171.5m in 2006/7.

Looking closely at the detail of the report offers more interesting insights other than the fact that the global downturn is still hitting hard.  For example it shows that in 2010/11 legacy income exceeded individual donations for the first time, that business sponsorship of the arts actually went up and that the support from the creative industries sector rose by about 25%. Even closer inspection reveals the real story – legacy income rising as a percentage of lower overall donations for example.

The report illustrates how different from eachother small and major organisations are in terms of funding strategies and perhaps suggests a note of caution over the new Culture Secretary’s rather blanket statement - not all organisations' asking power is the same and some are extremely disadvantaged by their location.  The report shows small organisations are more than twice as reliant on private investment as major organisations, and nine times more reliant on lottery funding with 8.1% of income from this source. However, earned income is almost constant across the board as a percentage of total income at approximately just over one third.

While the private investment map paints a stark picture of funding bias with London’s cultural organisations receiving around 71% of total funds. They receive over 70 times more private sector support than those in Northern Ireland, over 40 times more than those in the North East and almost 35 times more that those in the East of England. In short, they receive 2.5 times more private sector support than the rest of the UK combined.

The data comes from a survey of around 4,500 arts organisations, with a response rate of about 20%.

At the end of the 27-page report, Arts & Business offers a 10-point plan for how private investment in culture might be boosted in the future. It has set its own goal for the sector to raise £1bn of private investment by 2020. “To achieve this from current levels of £686m, we collectively have to hit 5% less than the most recent average returns. In the current environment we see this as a worthwhile and challenging target,” they say.

Recommendations include:

  • A Matching Grant Programme to stimulate business sponsorship of the arts
  • A new Challenge Fund Scheme to stimulate individual philanthropy for the arts
  • Tax reforms including around the treatment of investment in film and other forms of commercial activity and a change in what has been suspicion-driven policy around rules for donors
  • A Legacy Campaign for the arts.
  • A Campaign to increase Cultural Philanthropy from the financial sector and the wider business community and more corporate volunteering

One area it suggests should not be a focus is Payroll Giving: “With such a low take up in payroll giving in the arts, it is worth wondering why some parts of Government still place so much focus on it as a potential area of growth. Our sense is that it will never work for the arts.”

The report’s equivocal conclusion is that the arts can look forwarded with ‘grounded optimism’.

The full report can be downloaded here.

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