Select Committee on Culture, Media and Sport Appendices to the Minutes of Evidence


APPENDIX 49

Memorandum submitted by West Midlands Arts

  At its meeting on 23 March, the Board of West Midlands Arts (WMA) agreed in principle, and with amendments to the resolution proposed by the Arts Council's Project Board, to transfer its staff, assets, and liabilities to the Arts Council of England, in order to create a new single entity for the support of the arts in England. The amendments to the Project Board's proposed resolution primarily reflected the concern of the Board of West Midlands Arts that there was conflicting legal advice over the requirements of TUPE legislation and that the Board was being asked to give unqualified assent whilst much still remained unclear and unresolved.

  Despite a detailed discussion with the Chairman and Chief Executive of the Arts Council, the Board was not convinced that the Arts Council has, at any point, presented a business case to justify its proposals that is sufficiently robust; the majority of what has been put forward to date would not withstand even the most benign due diligence. The WMA Board continues to feel that there is no sense of clear and measurable objectives from the Arts Council and, therefore, no clearly thought through strategy to achieve genuinely beneficial outcomes. However, with the concern that the case and information presented to her may not have been sufficiently objective, nor supported by all the information and data relevant to the issue, the WMA Board recognised that the Secretary of State has made clear her full support for the changes. Having experienced staff turnover in excess of 30 per cent since the Arts Council's initial announcement in March 2001, the Board is concerned that continued uncertainty would have a further detrimental effect on staff morale and service delivery.

  With regard to the specific points made in your letter:

£10 MILLION CAN BE SAVED ON ADMINISTRATION COSTS BY THE CHANGES

  No evidence or detail has been provided by the Arts Council to substantiate this assertion. The WMA Board believes that substantial savings can be made by reducing staff in the national office, but would not, itself, have considered committing to achieving even this kind of benefit without undertaking proper, professional and accountable business and financial planning and modelling. Further than there being no evidence that the Arts Council has undertaken such a process, both the Chairman and Chief Executive of the Arts Council have emphasised, on several occasions, that such planning has intentionally not taken place. The claim that this cannot be done until the new organisation is in place is considered to be unbusinesslike at best, and, at worst, inappropriate in the handling of public funds. However WMA Board believes that, whatever the outcome, the restructuring should be efficiency rather than savings led.

ARTS OFFICERS WILL BE FREED FROM ADMINISTRATION TASKS TO DEVOTE MORE TIME TO FUNDING ISSUES

  No evidence has been provided by the Arts Council as to how reductions in bureaucracy will be achieved other than by reducing staff at the centre which might reduce the level of duplication inherent in an 11 organisation system. The comments as above, about insufficient business planning, apply.

FUNDING SCHEMES WILL BE SIMPLIFIED

  The proposals made by the Arts Council in this respect mirror the approach which has already been adopted by West Midlands Arts and a number of other Regional Arts Boards. West Midlands Arts believes that simplification of funding schemes could have been achieved without a costly restructuring exercise, and that much of the complication has been brought about by confused thinking and administration at the Arts Council itself, which has significantly failed to achieve the simplification and rationalisation targets and outcomes it set itself some three years ago.

THERE WILL BE GREATER FINANCIAL ACCOUNTABILITY

  West Midlands Arts accepts that there is greater central control within a single organisation, but not that this is, to any extent, the only way that greater financial accountability could have been achieved.

THERE WILL BE GREATER FUNDING AND DECISION-MAKING RESPONSIBILITIES AT REGIONAL LEVEL AND GREATER REGIONAL INPUT AT NATIONAL LEVEL

  The Arts Council's proposals do not provide information on what level of additional funding will be administered regionally other than the delegation of clients currently funded by the Arts Council. It is the case that the new organisation will give Chairs of Regional Councils a voice on the National Council and Chief Executives a voice on the senior management team, but the evidence in all this current process is that the regional voice is largely ignored. It should not be forgotten that the process was started by the Arts Council, with a "no-option" approach put to the Regional Arts Boards, and with no prior consultation whatsoever. Much of the time-consuming activity since the initiating announcement, and the fundamental loss of trust of the Arts Council by several Regional Arts Boards and many artists and arts organisations, could have been avoided by proper consultation.

THERE WILL BE GREATER INVOLVEMENT OF REGIONAL AND LOCAL GOVERNMENTS

  The Arts Council's proposals mirror the arrangements currently in place in respect of the number of local authority places on the Regional Council. Further details on proposed new relationships with local and regional government are still under discussion, but the importance of the involvement of regional and local government in the well-being and development of the arts should never be underestimated. The WMA Board remains concerned that this element was overlooked by the Arts Council in its first announcements and that, therefore, the importance that the Arts Council attaches to these relationships is, possibly, still insufficient.

SUMMARY

  In summary, the Board has reached its decision based on political expediency rather than a genuine conviction that the new organisation will be more effective.

  The process—initiated and led by the Arts Council—has not been conducted well and has caused an unnecessary degree of uncertainty, anxiety and instability throughout the arts communities.

  The proposed outcomes are vague, and are unsupported by proper financial and business planning, and there is no sense of strategic planning. The commercial sector would not tolerate such an approach, and the question "Why should the public sector?" remains unanswered.

  Nevertheless, having, in the "no-option" context, reached its decision, the Board will work positively to ensure that the new organisation not only maintains but enhances the quality of service delivery achieved currently by West Midlands Arts, as is recognised by artists and arts organisations throughout the region.

1 February 2002


 
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