Overview

The resources, funding, and support available to the UK arts and cultural sector will have implications for government priorities in areas such as growing the economy and providing opportunities for young people.[1]

There are several issues for consideration over this parliament, including the balance between public and other sources of funding; support for the creative workforce; and the geographical distribution of cultural provision and production.

Challenges and opportunities

Resources and Funding

Public funding available to cultural and creative institutions includes:

  • central, devolved and local government funding
  • a share of National Lottery funds for ‘good causes’
  • creative industry tax reliefs

Core grant-in-aid funding for UK arts and cultural organisations fell 18% between 2010 and 2023, which has had an impact on cultural organisations’ income mix. It has increased reliance on private funders (such as from donations or sponsorships) and earned income (for example, from ticket sales, or commercial activities like merchandise sales).[2] In 2023-24, 51% of museums increased their earned income, but 32% saw their local authority funding decrease or stop entirely compared to the previous financial year.[3]

In September 2024, the government paused a review of Arts Council England[4] to analyse the geographical distribution of arts funding instead.[5]

Contributors to the horizon scan highlighted that there has been less policy attention on the needs of creative industry sub-sectors such as fashion that have not had as much access to public funding as others in the past.[6]

Another issue is how resources are distributed across the creative industries. While smaller, community-based, cultural venues serve as training grounds for performers, technicians and industry professionals, many are in precarious financial positions and at risk of permanent closure, redevelopment or demolition.[7],[8] In music, an industry levy has been proposed as one way to secure vulnerable grassroots venues.[9]

Support for the workforce

Many cultural institutions and creative organisations use temporary contracts, for example to deliver fixed-term projects. The creative sector includes a higher proportion of freelance workers than the UK economy as a whole. In 2023, 28% of jobs in the creative industries and 50% of jobs in the cultural sector were classified as self-employed, compared to 14% across all UK sectors.[10]

While flexibility in freelance work enables some people to build careers in the creative industries, others find work to be precarious, low-paid and lacking in employment support or training opportunities.[11] As a result, high proportions of creative workers have left the sector or are at risk of leaving.[12] A 2022 report for the Scottish Government on the working environment in the cultural sector said there was an opportunity to see how better working conditions may improve recruitment, retention, and workforce inequalities.[13]

A 2020 report by the Centre for Cultural Value stated that social security provision, such as universal basic income, may support freelance creative workers and address workforce inequalities.[14] With 28% of musicians having a workplace pension and 14% having a pension of any other kind, the impact of an aging workforce might require intervention to provide creative workers with greater financial stability after retirement.[15] Some parliamentarians have previously called on the government to appoint a Freelancers’ Commissioner, to advocate in the interests of creative freelancers.[16]

Geography of the creative industries

The 2023 Geographies of Creativity report by Creative PEC[17] stated that the south-east of England dominates the creative economy.[18] It also highlighted the important contribution made by creative clusters across the country. As smaller clusters, or ‘microclusters’, can often be found in rural, coastal, and town-based areas, the report recommended that policymakers do not overlook rural areas in favour of cities.[19]

Researchers, arts organisations and funders have also identified the potential for dispersed clusters to be joined into ‘creative corridors’.[20] However, challenges might arise in mapping corridors onto administrative areas.17 Mayors across the north of England have identified a need to replace competitive bidding with policies that encourage partnerships and cross-regional collaboration.[21]

Contributors to the horizon scan suggested that the future of local authority finances will be important to support culture and maintain assets, including infrastructure and collections.[22] There may also be local economic benefits from large-scale government interventions, such as the UK City of Culture programme.[23],[24] However, a report from the Centre for Cultural Value stated there are questions about how sustainable these programs are “for those living and working in the area, including those working in the arts and cultural sectors.”25

Key uncertainties/unknowns

Funding

Opposition from audiences and artists to some institutions’ sources of private funding has led to the ending of some long-standing partnerships in the literary sector and elsewhere.[25],[26] Ongoing changes in audience attendance levels, and their discretionary spending on things like food and drink, could also have an impact on organisations’ earned income as they did during the pandemic.12

In September 2024, the public body review into Arts Council England was paused by the culture secretary in favour of a wider review of all arts and creative industries.6,[27]

It is not yet certain as to how the Employment Rights Bill announced in the 2024 King’s Speech will affect workers in the creative sector.[28]

Workforce

Global shocks, including the Covid-19 pandemic and the 2023 screen industry strikes in the US, have highlighted the vulnerability of workers in UK creative industries to external factors.[29] Significant gaps in the official data related to the cultural workforce remain, including a lack of data around self-employed earnings and the number of volunteers.2 There is also limited research literature on how social security schemes for creative workers benefit those with protected characteristics.14

Geography

Ongoing financial uncertainty for local authorities will continue to have an impact on discretionary spending on culture. However, greater devolution might change the context in which culture is understood and supported in local areas.[30]

Key questions for Parliament

  • How co-ordinated are national and local funding models for arts and culture? What improvements, if any, could be made to the timescales and awarding mechanisms?
  • What changes are needed to creative industry tax relief to keep them globally competitive?
  • What is the case for the government to appoint a Freelancers’ Commissioner? What powers and oversight should the role have?
  • To what extent is the nature of employment in the creative industries understood by government and being reflected in its policy making?
  • How robust is the talent pipeline and provision of grassroots infrastructure across the creative industries? Is government action required to strengthen them?
  • Are large-scale government interventions, such as the UK City of Culture programme, the most effective or sustainable way of supporting local and regional cultural provision?

Related documents

References

[1] Department for Culture, Media and Sport (2024). Culture Secretary Lisa Nandy speech at the Science and Industry Museum.

[2] Campaign for the Arts and the University of Warwick (2024). The State of the Arts.

[3] Art Fund (2024). Museum Directors Research 2024.

[4] Arts Council England is the national development agency for creativity and culture.  It invests public money from the UK Government and the National Lottery into the sector.

[5] Thomas, D. (2024). Ministers to explore mutualising BBC in next licence fee deal. Financial Times.

[6] The UK creative industry tax relief schemes apply to film, high-end television, animation, video games, children’s television, theatre, orchestras, and museum and gallery exhibitions.

[7] Youngs, I. (2024). Historic theatre saved after closure U-turn.

[8] Theatres Trust (2024). Theatre at Risk Register 2024 Announced.

[9] Culture, Media and Sport Committee (2024). Grassroots music venues.

[10] Department for Culture, Media and Sport (2024). Economic Estimates: Employment and APS earnings in DCMS sectors, January 2023 to December 2023.

[11] Carey, H. et al. (2023). Job quality in the Creative Industries, Creative Industries Policy and Evidence Centre. The Good Work Review.

[12] Walmsley, B. et al. (2022). Culture in Crisis: Impacts of Covid-19 on the UK cultural sector and where we go from here. Centre for Cultural Value.

[13] Culture Radar (2022). Review of Fair Work in the creative and cultural sectors in Scotland.

[14] Johnson, R. (2020). Policy review: Social security for cultural practitioners. Centre for Cultural Value.

[15] Musicians Union (2023). Musicians’ Census Financial Insight Report.

[16] Culture, Media and Sport Committee (2024). Creator remuneration.

[17] The Creative Industries Policy and Evidence Centre (Creative PEC) carries out independent research, is led by Newcastle University and the Royal Society of Arts, and is funded by the Arts and Humanities Research Council.

[18] Josh Siepel et al. (2023). Geographies of Creativity. Creative Industries Policy and Evidence Centre.

[19] Jorge Velez et al. (2022). Mapping and examining the determinants of England’s rural creative microclusters. National Innovation Centre for Rural Enterprise, and the Creative Industries Policy and Evidence Centre.

[20] Royal Society of Arts (2023). ‘Creative Corridors’ can be the key to the UK’s creative industries.

[21] Northern Culture All-Party Parliamentary Group (2022). The Case for Culture: What Northern Culture Needs to Rebuild, Rebalance and Recover.

[22] Local Government Association (2024). Cultural funding: challenges and opportunities.

[23] National Audit Office (2023). Funding of Coventry City of Culture Trust.

[24] McDowell, E. and Podgorski, A. (2024). Understanding the economic impact of UK Cities and Capitals of Culture.

[25]Agnew, H. (2024). Baillie Gifford and Edinburgh Book Festival end partnership after activist pressure. Financial Times.

[26] Savage, M. (2024). Barclays suspends festival funding after protests. BBC.

[27] Department for Culture, Media and Sport (2024). Government to carry out public body review of Arts Council England.

[28] Prime Minister’s Office (2024). King’s Speech 2024 background briefing.

[29] Bectu (2024). Half of UK screen industry workers remain out of work, Bectu research finds

[30] Wafer, K. (2024). Views from the Independent Museum and Gallery Sector on the Future of Local Cultural Decision Making. Art Fund for Culture Commons.


Photo by: Gordon Cowie via Unsplash

Horizon Scan 2024

Emerging policy issues for the next five years.