Local Government Finances

Earl of Clancarty Excerpts

Thursday 21st March 2024 Lords Chamber

[The Earl of Clancarty (CB)]

My Lords, I thank the noble Lord, Lord Shipley, for the opportunity to speak in this debate. Like my noble friend Lady Bull, I will talk about the arts and cultural services.

A good place to start is by quoting the briefing that the Local Government Association provided for the debate in this House on the arts in the name of the noble Lord, Lord Bragg, on 1 February:

“Councils have a key role to play—they are the biggest public funders of culture, spending over £lbn a year and running a wide range of other services. They are also place shapers and have a convening and supporting role in setting the context in which the arts can flourish. The arts are discretionary, but councils invest because they see the value to local people”.


One could of course add, “when they have the funding to do so”. The quote is valuable because it describes the intricacy of the relationship between the arts and the local community. On the one hand, the arts are a good in themselves in many different ways—they are something that local people can take pride in, and they may have a national or international reputation—but, on the other, the arts are also inextricably bound up in the identity of a local area. They are or can be a part of the character of that community.

How should all these varied arts be funded? I believe they should continue to be funded primarily through local government funding. That is still the most efficient and comprehensive means by which we can fund the day-to-day activities of the arts and other cultural services: efficient because local governments are the experts in their areas, and comprehensive because every area of the country is covered by local government and therefore much better at levelling up than the patchiness of the levelling up fund, whose purpose in any case ought to be properly understood as additional to the core funding of local government.

The great tragedy of the last 14 years is that, not only for the arts, we have seen at least a partial dismantling of this inherently efficient and comprehensive system. The specific point about the arts in relation to the funding cuts, as the noble Lord, Lord Hall of Birkenhead, pointed out recently when interviewed by the Observer on these cuts, is that they have been a “canary in the mine”. The noble Lord said:

“What we learn in Birmingham will soon matter across the country”,


and we are seeing that in Hampshire, Nottinghamshire and many other councils. It is the arts and other cultural services such as libraries, community and leisure activities that have been the first to feel the effect of long-term cuts. Indeed, around seven years ago Nicholas Serota made the point that the biggest crisis in the arts was in local government funding. It was seven years ago too that we had a debate in this House on local government funding and the arts—for which the noble Lord, Lord Shipley, did the summing up for the Liberal Democrats—which was in effect a warning sign to the Government that, bleak as the picture was then, it was going to get bleaker unless the matter was addressed. As we know, it has not been addressed, with a cliff edge having been reached in some cases.

The Government have had all the warning signs, but the Secretary of State for DCMS, Lucy Frazer, recently gave an interview for the Stage in which she said:

“It’s disappointing when local authorities make decisions to cut the arts”.


What is of course far more disappointing is the refusal by this Government to take responsibility for a situation for which they are ultimately responsible. The evidence is in front of them: it is not about well-managed authorities or otherwise. It is always possible to pick out councils that can be understood as examples of good practice—or in some cases good fortune, as recipients of the levelling up fund—but that does not describe the overarching narrative across the country of decreasing funds and the cutting of services, and of the irreparable loss of infrastructure, including buildings, as others have referred to. It is this that Lucy Frazer and the rest of her Government refuse to acknowledge.

I applaud the Government for giving the arts and the creative industries such a prominent position in the Budget, and one hopes that prominence will continue. However, theatres, museums and orchestras will have a sense of relief, more than anything, that tax relief, which was originally increased to counter the effect of Covid on the arts, has been set permanently at a higher rate. That shows perhaps more than anything how much some organisations that have normally depended on local government funding have come to depend on what was originally a temporary measure.

Staying with the Budget, capital projects are welcomed and will not be turned down, but what the arts really need is that basic help with day-to-day funding for which local government has been key. As a colleague pointed out to me earlier in the week, the Budget is not a spending review.

I will touch on one other area, the nature of the arts themselves. It is impossible in this discussion not to bring in funding streams other than local government, such as the Arts Council, which has started to fund through the Let’s Create strategy much that would once have been funded by local government, such as community arts projects, side by side with professional arts and arts facilities. For a long time my worry has been where this leaves professional artists and performers. Both community arts and professional arts are important, but there is an increasing danger that the professional arts are being shut out. That needs to be addressed because it is happening due to local government cuts.

It has become clear that we do not have a strategy for the arts that includes local government funding. We need more joined-up thinking, including between DCMS and the Department for Levelling Up, Housing and Communities. On funding of the arts overall, we are still moving in the wrong direction. I understand that the Arts Council has been asked how it can now make further savings of 5%. This makes no sense. As the LGA says:

“Public funding is an essential part of the ecology of the arts and culture in the UK”.


The Arts Council found that in 2020, for every £1 generated in the arts and culture, an additional £1.23 gross value was generated in the wider economy. Our arts and creative industries are the growth area in this country. They stimulate growth, as my noble friend Lady Bull pointed out. It is high time we reinvested in them, not least at the hugely significant local government level.