National Arts Bank

Baroness Warwick of Undercliffe Excerpts

Thursday 4th June 2026 Grand Committee

[Baroness Warwick of Undercliffe (Lab)]

My Lords, I thank my noble friend Lord John for securing this debate. It is a welcome opportunity to highlight the difficulties faced by our theatres, galleries and arts venues, and there has been unified support for it across the Grand Committee.

I found it fascinating to hear of his experience at Southwark Council and of how, under his leadership, the council took steps to address some of these difficulties. The examples he shared of a local authority being able to bridge the gap between fundraising targets and money raised, future-proofing those organisations and benefiting their local communities, are instructive and inspiring. I welcome the foresight of his specific proposal, and support him in urging the Government to think about how financial agreements such as the ones he outlined could be applied more widely. In the current bleak economic climate, we must do all we can to consider new funding models for our cultural and arts organisations, so my noble friend’s suggestion is worthy of serious consideration by all those who want to see a flourishing arts sector.

I have spoken to Joshua McTaggart, CEO of Theatres Trust, which is the DCMS public body tasked with ensuring that all theatres across the country, no matter their size or location, are equipped to serve communities and artists long into the future. Theatres Trust agrees that access to loan finance from public and private sources is a key opportunity to support theatres to secure their future operations.

To add to my noble friend’s example of the Old Vic, I will mention—closer to my own home turf—the former Bradford Odeon, which now operates as Bradford Live. It received a £12 million loan from Bradford Council, which ensured that the £50 million renovation could begin. Having seen it in its previous state, I was delighted to hear that.

Another cultural centre in the north, Morecambe Winter Gardens, secured a £107,000 loan from Lancaster City Council, which enabled the venue to unlock over £2.5 million of grant funding. Last year, the Kenton Theatre in Henley-on-Thames took a £100,000 loan from the town council that enabled it to navigate operational challenges and report a budget surplus this year.

There are also significant examples of successful cultural spaces benefiting from loans via Nesta, as has been mentioned. The arts venue EartH, in Hackney, secured a £2.1 million loan in 2017 and is now a prominent cultural space in London. Birmingham Rep secured a £500,000 bridge loan, which allowed it to unlock further local enterprise partnership funding, and £400,000 for the Mercury Theatre in Colchester enabled the theatre to manage working capital while it carried out major renovation works. It can be done; let us see it more widely done.

As Theatres Trust sees it, the challenge is twofold: there need to be more sources of these loan finances, but also the arts and culture sector needs access to sound financial advice on how to maximise these opportunities and not see a loan as a negative decision or fundamentally bad business.

In these economically challenging times, the question of who pays for the arts—and, just as importantly, how—is more urgent than ever. Indeed, the question resonates through the recent independent review of Arts Council England led by my noble friend Lady Hodge. In her review she reminds us that, between 2009-10 and 2022-23, public spending on culture by ACE and local authorities fell in real terms by 18% and 48% respectively, with some local authorities completely cutting their spending on culture. She notes the “stark capital crisis” facing the cultural sector, with more than three-quarters of arts centres unable to complete planned building work and 60% not having undertaken any significant refurbishment in over a decade.

We know this. It is why the £270 million arts everywhere fund announced last year included the creative foundations fund, aimed at urgent capital works to keep venues up and running. It was a welcome boost for struggling arts venues, museums, libraries and the heritage sector, with Kate Varah, executive director of the National Theatre, saying that this much-needed capital investment

“will begin the task of enabling arts venues in towns and cities across our country to upgrade their facilities, providing more jobs and training … and offering more opportunities for young people and communities”,

as my noble friend Lady Gill so powerfully set out.

We know that investing in the arts is an investment in our communities, our creativity and our future. The arts are a huge driver of economic growth and employment—the creative industries are worth £124 billion to our economy—and help skills development in young people, training the future labour market to be creative and to challenge old ways of thinking.

But while the Hodge review notes the

“existential threat to the health and vibrancy of the arts and culture sectors”

caused by a decade of cuts in public funding, it also acknowledges that fiscal constraints limit the Government’s ability to increase grant-in-aid funding for culture and the arts. No matter that the

“modest resource needed to secure the long-term sustainability of the sector would have a disproportionately positive impact on the cultural sector, economic growth and the life of the nation”.

Instead, in the current climate we must put our efforts into finding other, innovative ways to invest in our arts, as my noble friend Lord John is initiating here.

To that end, like others I commend the Hodge review’s recommendations—all accepted by the Government, I am delighted to see—not least that we support a strong Arts Council England, free from political interference. I hope the Minister can assure us that the Government will explore the various funding ideas put forward in the review as a matter of urgency, including committing to longer funding rounds, cultural tax reliefs and incentivising philanthropy. At the same time, can the Minister provide any further detail of the £425 million creative foundations fund supporting some 300 capital projects in arts venues across the country?

Finally, like others I was interested to learn from our Library briefing of the French initiative between public authorities and the main banks to offer individually tailored financial solutions to creative and cultural industries in the form of a bank guarantee and loans. It has helped more than 2,000 cultural companies and has been going since 1983, so it is high time we caught up.