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Finance report reveals recent trends in culture funding
Opening up public funding, support for earned income, and incentives for private giving
22.05.2017

Rijksmuseum. Photo © Amsterdam Marketing, Courtesy of City of Amsterdam

Everyone in the culture sector wants more support for culture – it doesn’t take intensive research to work that out. Yet public finances, consumers’ disposable income, corporate sponsorship and the value of endowments and financial investments are all volatile or under pressure in today’s world.

How can culture weather these trends? Our recently-published finance report has revealed the ways in which policymakers and the sector itself are adjusting their approach to cultural funding to meet new challenges and opportunities.

In many cities, policymakers are aiming to decrease the dependence of cultural organisations on public funding through supporting them to earn more revenue and increase income from private giving. Sustainability is a priority in London, driven by the national policy agenda of Arts Council England; it was also highlighted in the City of Amsterdam’s 2013-16 Plan for the Arts, which required every funded cultural institution to generate at least 25% of its own revenue from earned income by 2016.

Measures being used by policymakers include tax incentives, public match funding of crowdfunding campaigns, and building capacity within cultural organisations to improve their fundraising ability. Achieving a shift away from direct public funding will require cultural organisations to be more creative and innovative than they have been in the past.

A number of cities are also moving to open up their existing public funding programmes. In Shenzhen and Moscow, the emphasis is on allowing institutions which are not government-owned or government-run to compete for public funding. In Stockholm, the emphasis is on reaching underserved audiences better and bringing innovation into the sector by offering project funding as well as organisational grant funding.

A final notable trend is initiatives to increase private giving. These have drawn inspiration from the United States, which prides itself on having created what is regularly reported to be the best conditions to support individual giving in the world. For example, in New York City, 70% of all public and fundraised income comes from philanthropic sources.

Both Korea and the Netherlands have recently introduced tax incentives to encourage private giving. However, both have had little impact so far. It remains unclear whether it is simply too early to tell, or whether there are ingrained cultural attitudes to giving that cannot be altered so easily.

All these trends address some of the wider critiques of the public funding of culture – that it gets captured by special interests, that it creates organisations that can be distant from their audiences, that government has too much control, that it is too bureaucratic. Yet it remains to be seen whether there will be a global re-balancing of cultural funding ecosystems away from direct public funding – and, if so, whether it leads to better cultural provision.

To learn more, the full finance report can be downloaded here.