The Chancellor’s Autumn Statement on Wednesday set out the Government’s plans for a further £6.6bn package of savings to be found from public spending over the next two financial years. And the idea, of course, is that these savings will contribute to a £5.5bn package of investment in infrastructure, and to contribute further to growth.
Making the position clear
The press coverage the following day focused on the disappointing news that economic recovery looks as if it will take longer than we hoped, but the fine detail of what it would mean for everyone in the DCMS sectors was for the most part lost in the general noise.
So I’d like to take this opportunity – the first opportunity I’ve had, in fact – to make the position clear.
Our number one priority: promoting economic growth
On this site you’ll find details of the £50 million that was announced to create a second wave of 12 super-connected cities, the extra £22 million to continue the brilliant GREAT marketing campaign next year, and the new £6 million to foster skills in the UK’s creative industries. This is great news and, in different ways, all three announcements will feed into our number one priority: promoting economic growth.
On top of this, the Chancellor also announced that the Government will examine whether the administration of Gift Aid can be improved to reflect new ways of giving money to charity, in particular digital giving. This is an area of great potential for arts and heritage bodies – digital technology offers a means of boosting philanthropic giving across all society.
Money that makes them tick
But inevitably, we’ve had to find savings too. Our resource budgets – that’s the money that goes towards day-to-day running costs for all the bodies we support, the money that makes them tick, if you prefer – will reduce by one per cent in 2013/14 and two per cent in 2014/15. This is considerably less than the five per cent cuts that had been predicted but will, I know, be painful for all that. And as to those who insisted that ‘our’ world should be immune, I can only point out that DCMS budgets could not be given special protection because the taxpaying public simply wouldn’t accept that doing so was appropriate.
Ministers have decided to pass on these reductions in a way that protects a number of existing commitments, such as funding for Elite Athletes. As a result, not all DCMS arm’s length bodies will receive precisely the same percentage reductions, but as far as possible we’ve tried to apply the figures equally amongst our arm’s length bodies.
Each of our funded bodies will now need to make its own decisions in the light of the needs of its sector.
You can read copies of the letters that have gone to each organisation.
Increasing Lottery money
We know these reductions will pose real challenges to our sectors and funded organisations. We’ve always known that cutting the deficit was bound to involve reducing public spending – how could it be otherwise? Yes, we acted in 2010 to increase the amount of Lottery money going into our sectors. And, yes, of course we know that Lottery money and grant-in-aid are not interchangeable, and that the additionality principle whereby Lottery money cannot be used as a substitute for public funding, must be protected. But for all that, our changes to the Lottery do mean that a great deal more money will go into the arts and heritage of this country from that source in the future.
And finally, we hope that by passing these cuts on in as swift a fashion as possible, we are able to maximise the time our sectors have to prepare for the tough decisions they will face in making the savings.