National Assembly for Wales

Hello, I'm Hannah Firth. I am co-director and artistic director of Chapter Arts Centre.

Fantastic. Sharon.

Hello, I'm Sharon Stone. I'm co-director with Hannah and I'm director of finance at Chapter.

Thank you so much. Naomi.

Hello, I'm Naomi Chiffi. I'm director for collaboration at National Theatre Wales.

Good morning. My name is Louise. I'm director of Creu Cymru.

Diolch yn fawr iawn, and I should have said that, if you're on Zoom, you don't need to unmute yourselves or you'll get into a battle with the technical teams. You will be unmuted as soon as I call your name, I promise.

It's all incredibly difficult at the moment, since the pandemic. Obviously, we've had the cost-of-living crisis, and prices are just going up. All our costs are going up and up. Our suppliers of utilities—. We've had something like a 45 per cent increase in the last two years. That's coupled with the fact that we had a 43 per cent funding cut from the Arts Council of Wales in the latest round, so we've gone from close to £680,000 a year to £390,000 a year. And we've always been incredibly good at earning our own money. The arts council, we would say, part-funds us—around about 18 per cent of our income—but we've had that huge cut on top of the fact that everything is costing more, and of course we can't pass that on to our audiences. They haven't got the money to pay more for a ticket or to pay more for a cup of coffee. We'd price ourselves out of the market. So, we're sort of squeezed from both ends.

Yes, I can only imagine how difficult this must be. Louise and Naomi, would either of you like to come in on this? I'll go to Louise first.

What Sharon has said has been echoed across our members. Our members represent theatres and producing companies across Wales, and we're in constant communication with them about the effects of inflation and budget cuts, and, yes, the energy bills and the squeeze on staff wages have all come all at the same time as well as—the same as Sharon—many have received cuts as part of the arts council investment review, with some at 100 per cent, some to different percentages. So, it's a whirlwind of things all happening at the same time, basically.

I think I'd echo both of those viewpoints, although we are in quite a unique and unenviable position, having lost all of our funding from the arts council in the last investment review. But even before that, things were difficult. And as Sharon rightly points out, we can't expect audiences to pick up the tab for cuts and squeezes that are happening. So, essentially what we're trying to do is far more with far less, and it becomes unsustainable for the sector, for the individuals involved in trying to deliver those activities. We want it to be a diverse and rich sector for everybody, both within and for the people that are experiencing the arts, and, in order to do that, we need to make it sustainable for everybody involved. At the moment, it feels like we're in a very frightening position in terms of how the sector looks, going forward, and the impact that that will have on the health and well-being of us and the cultural identity of us as a nation. 

Yes, just quickly, Chair, sorry. It's obviously a very tough time at the moment, but I was just wondering—. You said you can't charge more for the tickets and things like that. I was just looking through the stuff you're putting on at the moment—GALWAD and The Cost of Living series—and I was just wondering how much these cost to produce, the numbers that tuned into it and any revenue that you might have had from that, just to give us an idea of what you're charging and things so that we get the bigger picture of what's going on, if that's all right. Thanks.

Well, GALWAD is a historic project that finished some time ago and was in collaboration with other organisations, so I can't speak for that myself because I wasn't directly involved in the project, I'm sorry. The Cost of Living production, again, was pre the funding cuts, and we charged 'pay what you feel' or 'pay what you can afford', through that system, which didn't generate as much revenue as we would have hoped, but then there were various conversations around that production in general. I think what we're trying to do with our current work is to provide opportunities for people to engage with the arts that are free, but that means that we're relying heavily on trusts and foundations and the generosity of those benefactors in order to maintain that as an ethos. But, again, that isn't sustainable as a business model, going forward, so we're in a very tricky situation, whichever way we look at it. 

Diolch, Naomi. I think Hannah wanted to come in.

I just wanted to add, around the original question around inflation, that, whilst we don't want to pass those costs on to audiences, as a venue that has studios, for example, and hire spaces, those costs are passed on more widely in the sector. So, we have 55 artists and organisations based with us and we hire our spaces to thousands of companies, organisations and individuals each year. Unfortunately, those costs have been passed on, so it does put pressure on the wider sector and not just us as a venue.

Thank you for clarifying that. Naomi was touching, a moment ago, on the health of the arts ecosystem and the effect on the health of the nation, in a way, as a result. What do you think the effect would be if the arts council were to receive and to pass on similar cuts, or further cuts, in the next budget round as well—not just on your organisations but on the arts in Wales as a whole? What do you think the effect would be? I'll go to Hannah first. 

I think it would have potentially devastating effects, and I think what's good to acknowledge here is the effect that that would have on artists and creative individuals, creative organisations across the sector because, as venues, for example, speaking for Chapter, it puts more and more pressure on our budgets to actually invest in those organisations and individuals. And I think that, potentially, what it'll do is to create a kind of talent pipeline block, because we'll all become more risk averse, for example, around putting on more experimental or early career artists. We need to know that we're going to get a financial return on our investment when we invest in productions or projects. And so our worry is very much that this will really stifle the creative sector, and particularly stifle, like I say, those talent pathways for younger, early career artists, and for a more diverse offer across the nation, because we'll be thinking, 'What will make the money? How will we be able to sell tickets? Do they have an established audience?' So, that could have a really critical impact on our sector.

I think that, also, we've traditionally given free space to young and new organisations and individuals getting into the arts. They maybe have a small project grant from somewhere, and they come to us, 'Can we have somewhere to rehearse? We've got no money to rehearse.' Last year, we gave over 5,000 hours of free research and development space. With the cuts that we've had and the fact that we've got bigger costs, we've had to reduce that availability to only 1,500 hours, because we have to make our assets work for us. And so those rooms that we would have given free of charge, we now have to charge organisations that can afford to pay. And when we ask these small organisations to make a contribution, even if it's only £50 for a week, they just say, 'We haven't got that money.' So, we're finding that, where we've supported that route of the arts through allowing them to use Chapter, we've got less availability now. We just can't do it, and it's really sad for us, isn't it, that we just can't help in the way that we used to.

Echoing Hannah and Sharon, the theatre sector in Wales is an ecosystem. I think we are very close to losing physical buildings and seeing closures. I think if further cuts come, that's going to be even closer. We've obviously seen Redhouse in Merthyr going, there's been a threat to Blackwood Miners' Institute—these are the ones that we know about. There are others that have told me that if further cuts come, they are also at risk. The ecosystem comes under the university-led buildings—and we know the state of the higher education sector—there are independent and trust buildings that have been in trouble for a while, and then you've got local authorities, and we know the state of local authorities.

And that's just the buildings. Going back to Hannah and Sharon's point, it's then what goes in the buildings. If they don't exist, then there are not opportunities for artists and companies to tour. I love a tribute band, but we are seeing more tribute acts, because that's work that's sold. So, those companies that are making really significant and groundbreaking work are perhaps not getting the opportunities that they should be getting because everybody's got to be a bit more risk averse and really respond to what might sell and get people through the doors. So, it is a big worry.

Lots of the venues have got cinema spaces, and we know that cinema tickets have gone down, particularly since the pandemic. So, where people might have relied more on cinema sales, that again is not helping the situation. It's safe to say that I'm quite fearful of more cuts, because I think where we've seen examples of local authorities using it as a reason to perhaps save some money, we might see that further afield. 

Diolch. Okay, thank you very much.

So, who would like to come in first on Heledd's question?

I don't mind. I think one of the potential impacts for that is that, sometimes, the work that we do around mental health and well-being is very deep, long-term work. We want to make an impact on people's lives, but we don't want to parachute in and leave again after a project, so it's inch-wide, mile-deep work, and that takes a great deal of resource. So, to really do that work authentically, we need to have resource to be able to work really closely with communities to design and co-create that kind of activity with those communities so that we're not telling them what they need to be doing, that we're actually creating it with them, and that does take a lot of resource.

I think that we might see challenges to our more authentic work, working with those communities around health and well-being, as a result of further cuts. We'd still have events happening, but, as I said earlier, there might be some more homogenisation of those as we go more towards the tribute bands, for example, or something that we know will sell a lot of tickets. And what we're talking about is creating bespoke activity, often with particular communities who have very particular needs, and those can be very diverse across a range of different groups of people. So, I think that we could face a lot of challenges in doing that work in the future.

Just to echo that, co-creation and that deeply embedded approach to working with communities across Wales is so important, but it does—as you rightly point out—require quite a lot of resource, time and money. We were fortunate to have funding from the Paul Hamlyn Foundation to run two five-year projects in Pembrokeshire and Wrexham, projects of co-creation with communities, and we saw there the impact of how we could support vital services across other sectors, such as the health sector, the education sector. I think that's what we are at risk of really losing with further arts funding cuts. Because we understand the challenges faced by the Welsh Government when it comes to allocation of funds, but I think it's really important to remember that arts aren't a luxury, they're not a means of entertainment; they can't just become the privilege of the few when it's the right of all of us. And I don't just mean the right of all of us to go and experience theatre or the arts in whatever form you choose to experience it, but in so much as it's such a vital part of the nation's cultural identity, it brings communities together, it can support the health service by providing vital interventions, it allows our young people to become more adaptable, capable learners. So, I think investment in the arts needs to be viewed far longer term, and look at how that can release and reduce pressure on other services moving forward.

Can I pick up on that, please, Naomi? What you're saying is, obviously, you'd expect that it's something that we're all signed up to through the future generations Act. Do you feel there is a risk that we're going backwards in terms of that commitment? Because there have been some criticisms that that is perhaps the least developed or understood goal, in terms of culture.

I personally feel that there is a huge risk to achieving the amazing goals set out in the future generations Act. It's really something that Wales is so proud of, it's enormously optimistic and hopeful, and it makes me proud as a Welsh mum that we have such a thing. But I do feel that those aims and objectives are at risk without effective investment in the arts, because it's a structural backbone that can ensure that we are able to achieve the aims of the future generations Act in so many different ways.

If we could unmute Louise, please. Thanks.

Sorry, I was wondering whether I should press the button. 

No, you did exactly as I asked you to do. You did everything right.

We're currently undertaking quite an in-depth report with our members, which we are going to share, obviously, with the committee and Ministers as soon it's ready. We've done the first stage, which is really looking at the impact across the board, including touring and the impact on physical buildings, the ability to maintain buildings, pay energy bills, et cetera, impact on staff. And then the next phase is a more quantitative survey to really try and get some really in-depth stats. So, literally in the next day or so, the second half of that work is going to begin, because we really want to get an idea. Because I know them anecdotally, but really we want to get it down on paper to be able to say that x percentage of whichever venues they fall into are in danger of closure. So, we will share that as soon as we've got that information.

Thank you. That's incredibly helpful, and it will obviously help our work. Perhaps if I can turn to Naomi.

During the investment review and post the investment review, we went through an appeals process, which I think was quite well documented. We felt that there could have been interventions on the part of the arts council prior to the investment review that would have, hopefully, meant that the cuts weren't as dramatic as they were. As we know, the outcome of the investment review and the appeals process has been covered in the media and is available for viewing. Since then, we have worked really hard to try to re-establish a strong and healthy working relationship with the arts council. We've done a lot of bridge building and a lot of discussions around how we can find the best way forward for everybody involved.

We've obviously been through a period of great stress and difficulty as an organisation, with voluntary redundancies that have seen us reduce our staff to four core staff and five project-funded staff. So, we've completely shifted the focus of the way in which we've been able to work. The arts council very generously gave us transition funding to help us look at what National Theatre Wales or a national theatre for Wales can be and should be going forward, and that's still an ongoing process. That transition funding is ring-fenced for that line of work only.

What we've been trying to do to keep things moving operationally is, through a generous grant from Cardiff Council and the UK shared prosperity fund, we've been able to continue the work of our engagement model, which is called TEAM, and that has allowed us to continue to work in schools, to continue to support creatives across the sector, to develop a creative development opportunity for artists, to create a network of young people who are coming together to build, essentially, their own company through an intensive year-long engagement programme of mentoring and development opportunities. So, we've been able to do quite a rich and varied programme of work through the Cardiff and UK SPF money, which sits separately to what you would call the wider artistic programme of NTW, which has very sadly had to be put on hold for now due to the arts council funding cuts.

But we are hopeful for a different future. We don't know what the outcome of that will be yet, but I think that the work we've been able to do through the UK SPF has really enabled us as TEAM, the engagement branch of the organisation, to grow and to reassess what we think the vital and important parts of our work are. Whilst that has had to be Cardiff-centric because of the restrictions of the fund, we're hopeful that what we've learned from that model could be rolled out to something that is more of a national offer that could have an impact across communities across Wales, which is where I see us having the greatest impact.

Thank you. You just mentioned that the SPF was helpful with some projects. Before that, European funding, I suppose, was also helpful. There was a promise, wasn't there, that some of the replacement funding coming forward—what might replace the shared prosperity fund—would be, hopefully, devolved to Wales, so maybe that's something we should follow up, because it sounds like that funding has been adding value, hasn't it, and really helping to support the arts. I see nods. 

That funding has been essential to us. It's been absolutely wonderful and it's been able to keep us going over the past year. We have created some really excellent work and built a whole new network of creatives because of it and through it. So, to be able to think that there is a future for that pot of money could be really important to the sector, I think.

Could I ask you a question about audiences? What's your latest data on audience participation and ticket sales now, compared with pre COVID and pre the cost-of-living crisis? Have you had audiences and sales return? Just a question on that, really.

I'm happy to start. We're at about 75 per cent of footfall, and our audiences are very similar across theatre and cinema. We do a lot of pay what you can in our theatre because of audiences being risk averse. And although our footfall is about 75 per cent of pre pandemic, we—. I don't know whether you know Chapter. We have a big, open cafe-bar area; lots of people come and work in our area, which is lovely to see, but they're not particularly spending money. We want people to come and work, we want them to be part of that arts environment, so it's very difficult; we're still a long way away. Audiences' preferences have changed, what they do has changed. Just the whole climate has changed. It's taking a long time to recover from everything.

I think, just to add, as well, I don’t know whether other venues are experiencing this—from our discussions, they are—the way that we book tickets has changed as well, so we're a very last-minute nation of ticket bookers. So it's therefore really difficult to plan, because you can have a virtually empty theatre on a Tuesday and, by Thursday, you've sold out, and so balancing your resources to encourage people to attend is also really quite challenging. Whereas pre pandemic people were booking a lot further in advance, so that kind of uncertainty also adds a bit of jeopardy to the work that we're doing as well.

Louise.

Yes. Just to echo, again, we've heard that last-minute booking, and that's affected some venues that have hires. So, obviously, when they hire the space out to community companies, who, even their sales might be later in the day, and then they cancel the booking and so the venue is not getting as much revenue or secondary spend behind the bar, for example. Last Christmas was the first Christmas—we always judge Christmas, because it's a big sales time for theatres, and it was the first Christmas—that, on the whole, most venues got back to pre-pandemic levels. But this is going to be a really interesting Christmas, because, again, as we mentioned earlier, audiences are obviously having their own issues with finances. So, we might see a dip this Christmas, but it's always a good one to look at in terms of spend, because it tends to be when most families get out, so there are bigger, larger bookings. So, we will be keeping an eye on Christmas bookings especially, this year.

And has participation been more or less inclusive—the types of audience that are coming along?

Do you mean in terms of—

Has there been a change—?

—[Inaudible.]—activity?

Yes.

Yes, pretty much. We're still seeing similar levels of activity aimed at certain groups and again, we've seen some examples of arts activity, outreach activity, put on for certain demographics, and, actually, it's the people who have got, perhaps, more disposable income who are taking up those opportunities, and it's trying to encourage others to, perhaps, take part in those opportunities.

Yes. I think that speaks to what I was saying earlier about that work requiring more resource. We certainly are experiencing at Chapter a much more diverse audience, but we've also invested in teams to work more closely in communities to develop the co-creation that we were talking about. So, our business model is what we call a 'community informed model', so we have curatorial specialists who work directly with communities to devise the programme. And that has meant that we've been able to build more trust with communities on our doorsteps, and we're seeing that in terms of attendances to events. But we also have community tickets, which we give out for free, working with local charities and organisations and 'pay what you decide'. We used to have free cinema screenings every week, and, during the holidays, every day, for children and young people and their families, but now we work closely with charities, because what we were finding was that people with disposable income were booking those earliest and attending the screenings. And actually, working with the charities, we're now able to distribute those tickets more fairly so that we're getting more marginalised communities who are able to attend. So, we've seen a big change and a big shift in our audiences, which is really positive.

And do you feel that, post COVID, just trying to build that confidence of coming back out and thinking about going back out and connecting to the arts is something that you've had to work hard at?

Very definitely. Yes, I mean, we're lucky that we've got quite a large venue. For example, our cafe bar is very spacious and we were able to manage that quite well when we didn't want to be close—well, we did want to be close to each other, but we couldn't be. But I think people are doing a lot more stuff at home, for example, their habits have actually changed. And our cinema tickets, for example, and our theatre tickets, are relatively cheap in comparison to other venues, but if there are four of you and you're attending that can be a lot of disposable income for a family in a day. So, they're staying at home and watching something on Netflix, or whatever, instead. It's building trust to help them understand that, actually, they can come in, there are some free events that they can access, and they can sit in our cafe and keep warm and have a cup of tea or whatever at a relatively low cost. So, it's selling a message and a story around what attending venues looks like, as opposed to, 'Come and buy a ticket, you'll have a great time.'   

Okay, thank you. To what extent have you collaborated with other organisations to mitigate the impact of declining public funding?  

Shall I start? 

Whoever. Please, Hannah. 

We do a lot of collaboration and, actually, more so since cuts, particularly around working with partnerships and organisations across the nation around not working in parallel on the same things, so how can we use our intelligence and share that. So, there's a lot more work around that happening. But also—. We've always worked in partnership and collaboration, it's the nature of our organisation, but we're doing that much more now, because we're all sharing more limited resources and we all want to reach, often, the same audiences and, therefore, the same ends to what we're doing. So, we work very closely in collaboration, naturally, with organisations that are based in our building, but then also across Wales. It feels very important that we work more collaboratively and share our resources now than ever. 

Thank you. 

Does anyone else want to come in on that? 

Louise's hand is up. 

Naomi, do you want to come in first? I couldn't tell if you were brushing your hair—[Laughter.] 

I went for the double. I was just going to echo the same thing. Collaboration, I think, is key to sustaining the arts sector. That's what we've got to do. We've got to work together and we've got to see this as an ecosystem. We're like fungi, you know, underground. We're all aiming towards the same ultimate goal, so rather than working in silos, looking at how one hand can support the other across the sector and across Wales as a nation, and I think that's something that the Welsh Government could really help us do, setting out clear aims and objectives to support that, so we've got a national strategy, effectively, that we're all working towards a common goal that is supported by the Government, leading us forward to the same end. I think that's—. My title is 'director of collaboration' and I feel like that really the only thing that we've got in times of crisis is each other and pulling together. 

Okay, thank you. 

Okay, Chair. 

Thank you, Chair. You say that the UK SPF funding has been a lifesaver, but to what extent have you sought to raise additional funding, for example, commercially or from trusts and foundations, to mitigate the impact of declining public funding? Thank you.

Who wants to go first? 

Do you want to go on that? 

Sharon. 

It's what we do, it's our bread and butter. We look at trusts and foundations all the time. The problem with it, of course, is it is restricted funding. So, it doesn't really give you anything towards the core activity of your organisation, so you end up having lots of projects that you're diverting resource to. I think, in this current financial year, we've raised over £500,000 through different areas, but it's all project funding or it's capital funding. Our biggest success this year, I suppose, is Fidelity Trust have given us £150,000 to adapt our studio into a multi-use space, and that's about our sustainability, making that more useful to us as a tool and more adaptable to lots—so, it will be a cinema, a theatre, a rehearsal space. So, we're looking all the time at bridging that gap, but it's not the same as having an unrestricted fund that just goes towards your core activity. You've always got to have an activity associated with it. So, it's great to have, but brings its own hurdles, I suppose. 

Thank you, Sharon. Naomi. 

I would just echo that as well. Obviously, the UK SPF has really helped us this year to be able to continue our team activity, but we're also being supported by the Hodge Foundation, Esmée Fairbairn Foundation, John Ellerman Foundation, Noël Coward Foundation. So, we're constantly applying for pots of money from all sorts of different trusts and foundations. But, like you've rightly pointed out there, Sharon, it's often restricted, often not for core costs, often not for salaries, very much on a project-by-project basis, which is fine, and we're very, very grateful for that, obviously, but it does also mean that, when we're running on a limited staff, as we currently are, to find the time, which is often after hours, to complete those application forms, and then to do the evaluations, which are a really important part of the whole process, then eats into the project delivery time, and eats into what we're able to achieve. So, yes, it's a really important part of being able to sustain the sector, but not without its challenges.

Diolch. Anyone else?

Diolch, Chair. Naomi said earlier—and quite rightly and I think we all agree with it—that the arts need to be accessible for all, not just the few. So, how have you sought to mitigate the impact of funding reductions on people with protected characteristics or lower socioeconomic status? Thank you.

Shall I go?

Yes, Sharon, go for it. Oh, Hannah—forgive me.

That's okay. I think we mentioned a few things earlier. We've expanded, we've actually invested into our community engagement department, to work more closely with people mostly on our doorstep, within a 3-mile radius, who perhaps don't come to Chapter, or don't have access to culture in the same way that others do. And so what we've done is a lot of events. As I described earlier, we have our free cinema screenings; we also have a community larder that provides food for free. We have a Pay It Forward scheme. We have a 'pay what you can' scheme, so that you can at higher rate, but you can also pay nothing, if that would limit your ability to attend. And so we have quite a lot of different strategies in place to encourage attendance.

We also do a lot of work around making our events much more accessible, which, of course, brings with it a cost. So, every day we have something that is audio described, a film that is subtitled. We do a huge amount of work with the deaf and hard-of-hearing communities around Wales. We just held our second deaf-led festival of culture at Chapter, which was very well attended, but also brings with it a lot of costs around access, to ensure that everybody who attends can enjoy it equitably, and so that involves, obviously, raising funds as well. But our work from our community engagement department is very much working out in the community. So, rather than working in the venue, it's building the trust out in the community, which we know is long term, to eventually encourage a relationship with the venue, and that takes time and resource, of course. I don't know whether you want to add anything.

We're constantly fundraising for that sort of thing. When we first started doing our free cinema screenings—and we also do free packed lunches in the school holidays, and children can just come along and take them; we don't ask any questions or anything like that—we did that from our own resources. Now we have to actively fundraise for it. But we don't want to let it go, because we realise how our audiences are struggling. But we want them to come into the building, so we do a certain amount of free cinema screenings in the summer holidays. And the next half term, we'll do the free ones, and the rest of them will be £3 a ticket for a family—so, for a family of four, it would be £12, rather than nearer £30 on a normal day. So, we're always trying to fundraise for that. Our fundraisers are very good at very good finding small pots of money and, actually, our customers are very good at donating to us. We do a little Pay It Forward scheme—it's £3. So, if you're buying a cup of coffee, it's like buying two cups of coffee, and I think people really appreciate that they can do that, and it's very popular. 

Thank you. Louise.

I was just going to jump in, in terms of representing all the venues around Wales. There are 40 venues that are part of the Hynt scheme, which you might have come across. This is a national card access scheme that we manage on behalf of the arts council. We did a massive report on the scheme last year, and 84 per cent of cardholders said they would go to the theatre less if they didn't have access to the card. This is a cross-Wales scheme that is now being rolled out across the UK. So, I think there's a lot of doom and gloom around at the moment, but it's also really good to think about the things that Wales is doing really well, and this scheme, like I said, is being modelled across rest of the UK, giving access to deaf and disabled audiences to arts that they might not have had access to beforehand.

Diolch. Naomi.

I think something that we've always been able to do through TEAM, and has always been a really important part of our work, is to work in socioeconomically deprived areas, or with under-represented groups. We specifically look to provide opportunities to diversify the sector, diversify the stories that are being told, and make sure that the arts are accessible for everybody. So, when we have, or when we did have, large-scale productions or a body of work we would always start with a free evening for team members and community groups that we had worked with, so that they could be the first people to see the show for free in a sort of tech and dress run. Everything that we provide through the team programme is also free—so, all of our networking events, all of our participatory programmes of activity. We make sure that we provide that for everybody and to make it as accessible as we can. That doesn't come without its own costs, but we feel like it's a very, very important part of what we do and why we do it.

Laura.

That's excellent to hear. Just a quick supplementary on something that you said. The deaf-led festival at Chapter sounds excellent. I'm just wondering how that's advertised across Wales to ensure that as many people who are deaf can benefit from that, please.

The original festival was developed with a collaborative team of venues across Wales, so we did it as a national project. It has been advertised across Wales and elsewhere using BSL, flyers and so on, so fully accessible in terms of marketing. For example, our conference, which we held, we filmed that. We're currently just adding the BSL and subtitling, and that will be made available on our website and on the Deaf Gathering Cymru website, so that anyone—. Because many people actually can't attend for very many different reasons, and we want to make the content of the festival as available as possible. So we'll move on to a digital version of that so that other people can share that.

That's brilliant. Thank you for that. Sorry about that—just interested.

To all of you now, what else could the Welsh Government do beyond additional funding to mitigate the impact of reduced funding on the arts? Thank you.

Louise. 

I'll jump in. I think there definitely needs to be more cross-collaboration with other Government departments, like we've heard already in terms of arts and health, education, the creative curriculum. I think we're not looking at diversifying where the funding is perhaps coming from, and making more use of that. Often there's been a drive, and I understand it, around film and tv, around skills, but there is a lot of cross-over between the two industries in terms of the workforce, and so, perhaps, in looking at where there are schemes aimed at developing workforces for film and tv, could theatre be integrated into those kind of schemes? So, it's more about diversifying funds that are already there, as well as protecting future funding, looking at where other opportunities might lie. I mean, obviously this is fantastic that we're speaking today, but more collaboration with the arts sector and, perhaps, a cross-party arts group would be fantastic, so we're really getting every level of government understanding how it operates, what benefits it has, and why we're really here.

Anyone else want to add anything? Hannah.

Just thinking about what we were talking about, skills development and our reliance on project funding, I think investing in ways to recruit into the industry is really key as well, because we are facing the threat of losing really talented people from Wales because they can't get access into jobs or opportunities or longer term projects, because we're relying on dropping in and out of project funding. So, if there's a way to support that through different ways of finding access into the industry, I think that's a really, really vital way that we could be supported.

Just to echo everything that's been said there, Wales is such a talented nation of artists and creatives, but we are in danger of losing some of those most talented to outside of Wales, without the direct talent pipeline for them to follow and a path for them to follow. I think that the Welsh Government could support the sector through—. The creative curriculum is brilliant, but we are seeing a huge skills shortage in certain areas across the sector—so, interventions in schools where we reinforce the need for specialist teaching across creative subjects like music and drama, specialisms like that, so that we are getting the next generation of violinists that sit in the Welsh national orchestra and we don't have to bring them in from outside of Wales. And then, apprenticeship schemes for backstage and technical staff, again, is another shortage. We could be providing pathways for them.

But, more broadly, and as I touched upon before, I think the Welsh Government could play a more strategic role in holding a direct relationship with national companies and organisations, as well as funding bodies, so that we're all working towards one strategic national approach to the arts, like a joint and common commitment to what we want our cultural sector to be and how we want that future vision to pan out.

I've enjoyed the conversation this morning. I've tried listening to your different perspectives on these issues, but I want you to convince me of something, and this is what it is: to what extent is this simply a financial crisis that you've been describing? And to what extent is there a change taking place in society that the sector isn't especially handling well? What I mean by that is I go to far less arts nowadays because, as you've pointed out, Netflix is very easy, very convenient and, after the week we've had this week, a lot easier than to go out in the rain. So, to what extent are we seeing social change that is impacting on the sector and your ability to generate funds, and your ability to generate audiences and the rest of it, and to what extent is this a crisis of funding that is essentially created by austerity and the Welsh Government decisions and the rest of it?

Are you coming to me first? It's a combination, I think, is the answer that I would give to that. As we've talked about, there is social change. People are spending more time at home or their habits have changed since COVID, actually, and it's just taking time to remember how joyful it is to be together in communal places. But I think also it's a hard financial fact that people can't afford to go out in the way that they used to, or prices have gone up, from pubs to theatres to, you name it, cafe bars, whatever, and actually, thinking about whether you can afford to spend £30 on a night out to go to the cinema alone is challenging for a lot of people. The cost of living has gone up everywhere else.

I think we could tell stories better as a sector around what that conviviality and hospitality and community looks like as an arts sector, and that's something that we're working on at the moment, because it's reminding people as well of what the arts can give them, how we can work together. And I think it's rebuilding that story of, 'We're not just building something for you to come, we actually want to do it with you because we want to have a diversity of voices in our programmes for you to feel part of it, and feel that you're part of that cultural democratic process of shaping the culture of Wales', which I think is something that people now more than ever want to be part of. Before, it was like, 'I'll see what's on and I'll go'; now it's like, 'What does this mean to me? How does it add value for me?' So, I think we can tell those stories better, but I think also that habits have changed and, financially, it's such a challenge for people.

So, what about Government and Government decisions? 

Well, in terms of greater investment—

The funding. 

Yes. I think we've all talked today around the role that arts can play in health and well-being and telling stories about climate justice, and so on. We even have projects like Arts and Minds that the Arts Council of Wales are working with NHS Wales on to look at well-being and health, and investing in specifically how creativity can help us with our mental health and well-being. We're doing a lot of work with communities, but I think there needs to be increased investment in recognition of that, because we know, and it's well documented, and there's a lot of data around how creativity and culture can help society, community cohesion and inclusiveness, inequity. And it needs some investment, I think, to make that a more secure sector.

Anyone else? 

Would anyone else like to come in? Louise. 

I've watched these committees a lot, and, obviously, you've heard that the steady decline of funding has not just been what happened in December; this has been happening over the last decade. We are in a perfect storm of all of those things. We've got to remember that, during COVID, venues were shut for 18 months, and that is a habit-forming closure for a lot of people. If you get out of the habit of going, and there isn't the option to go, then—. So, it's all of these things happening all at the same time. But the cuts from Government is not a new thing; it's a steady decline that's been happening over the last 10 years. And, I think, perhaps as sector, we've not responded to those cuts strongly enough, as we are perhaps now, and that might be a thing that we've got to hold our hands up and say, 'Perhaps we could've done that differently', but we are saying it now.

Going back to the audience habits, lots of people are now looking at their operations and responding to audiences and the different needs of audiences and perhaps the habits of audiences, but that is going to take a bit of time, and we've just got to work out how people really want to—. Going back to Hannah's point, what is it that they want to see now, given all those other things, not just Netflix, but live music—? You know, everybody's competing against each other for that secondary spend, when that secondary spend is being squeezed across the board.

Okay. I don't disagree with you, by the way. I'll ask Robin to come in if I get this wrong, but I think it's fair to say that the Welsh Government has not funded the arts and culture sector in the same way as, say, Scotland or the Republic of Ireland, in terms of general funding over the last decade, and perhaps more. So, do you think the Welsh Government actually cares about arts and culture?

Louise, do you want to go first? Alun is looking intently at you, Louise, so I'm going to call you first.

Well, it doesn't really appear so. I think we could care more, couldn't we, and I think we should be shouting more about not just the projects that we've spoken about already today, but the amazing artists that have come out of Wales—the actors, the directors, the performers. And we do shout about those, and we're very proud of those, but, actually, we don't then acknowledge, perhaps, how they got to where they got to and what routes they took. I could list numerous performers that are on television right now that came through grass-roots outreach projects at venues across Wales, and I think we should be making more of that. And I think we should be making more about—going back to Heledd's point—future generations. Culture is in there, and yet do we really show and demonstrate that as a nation?

But that's my point, you see—that's my point. We tick the boxes—and I've never heard a Minister in the Welsh Government not talk about culture at some point; I've done it myself—but when it comes to voting on the budget, which is the real declaration of a government's values, the arts and culture sector is the easy target and is cut. And, as you've said and, as I think I'm right in saying, that is not a recent issue since the pandemic; it's been the same going back over a decade. So, that tells me that the Government says one thing and does another. But I don't want to put words in your mouth. I'm trying to—

No, I agree. We don't even have an arts Minister.

We do. We've got an arts and culture deputy Minister. I don't—

But they've got other things within their portfolio as well. That then stretches where attention—. And that is not about the individual; that is just about the structure. It would be great if there was an arts Minister that was just looking at arts and that was it. I understand that there are reasons why that isn't the case, but that at least has somebody that is championing the sector and pushing things forward and really putting it front and foremost.

Okay.

We have six minutes left, and I'm sure that other witnesses would be very keen to come in on Alun's bombshell question. Who would like to come in on this? Sharon.

I'd just like to say that it's fantastic that culture is spoken about in the Welsh Government, but there's no statutory note to say that it has to be funded, and I think that's something that maybe should be addressed, so it's less easy to just cut. I mean, I would agree with Alun. Until this year, when we had our funding cut, we'd been on standstill funding from the arts council for 10 years, so we've always had to make that bigger gap, because 'standstill' actually means a cut. So, we haven't been able to invest how we want to invest.

And then, if we go back to the capital side of our organisation, we’re on a 125-year lease from Cardiff Council for our building, but it’s a non-repairing lease. So, we’ve got a 100-year-old building that needs a lot of investment. We’re always looking at finding chunks of money to do that as well, as well as deliver all of our programme. So, we’re always stretched in everything that we do, and we need the venue to do the things we do, and the things we do need a venue. It’s that chicken-and-egg thing, isn’t it? So, there needs, maybe, to be an arts investment, but also, maybe for venues, some capital investment, so we can look after the buildings that we have.

And that was a really fascinating idea that’s come up before as well, that the arts council has called for culture and sports support to become a statutory responsibility. So, it’s really interesting that you’ve made that point. Naomi, I know you wanted to come in before we go back to Alun. Naomi.  

I think it’s just to say that it is difficult to believe that the Government cares as much about culture as they say that they do. But I think it’s really important that we remember that it’s in our national anthem, for goodness' sake. We are a nation of creatives and poets and performers, and, yet, we’re losing all of that talent by not investing fairly in it.

But I think it’s even broader than that, I think it’s a failure to see the wider impact of investment in the arts and how that can support other sectors and other services that are pushed to the limit. We could do so much to support the NHS, for example, and relieve some of the pressure there. And I think it’s about looking at the bigger picture, like I said earlier, and looking at it as a longer term goal rather than an immediate short-term, ‘We must get people in to see this particular show.’ It’s much—  

Okay, time is against us. I appreciate what is being said by all our witnesses. This is a difficult question, which I’m going to frame quite badly, I think: at what level do you think we should be funding the arts? And I don’t want you just to pick numbers out of the air; it might be useful if you were to write to us, actually, afterwards. But, if you say—and the committee agrees—that the current level of funding is inadequate, fine, that’s a relatively easy thing to say. So, what is an adequate level of funding? What does that look like for your organisations? And let’s not—. It’s not Christmas yet. Let’s think realistically about what you believe the Welsh Government should be directing towards the arts and culture sector as a reasonable foundation for the ambitions that I think we would all share.

I’ll bring Louise in now. But if—because I’m sure that witnesses would like to write to use with more detail—there are particular organisations that you work with in other nations that you could point to, where you think we should be learning from examples elsewhere, that would be particularly useful as well. But I will bring Louise in on this.

I’ll do it very quickly. So, the current spend is 0.15 per cent of Welsh Government budget; the average in Europe is 1.5 per cent, and it goes up to 2.5 per cent in some countries. So, let’s get to that 2.5 per cent, but maybe we’ll get to the 1.5 per cent to start with. So, I’ll give you a percentage.

That's a very good way of putting it, actually. It's like the—

That's a nice challenge, yes.

—Tony Blair idea of health spending. 

Diolch, Louise. Naomi, you wanted to come in. 

No, I didn't want to come in. I was just cheering silently. [Laughter.]

Okay. I misinterpreted your cheer as your hand. Hannah or Sharon, did you want to add anything?

I just agree, it’s got to be a percentage, hasn’t it? You can’t put a number on it, it’s got to be a percentage and an ambition to fund better.

But just thinking about models, there’s a really interesting model in southern Ireland around a universal basic income for artists.  

Yes, we were in Dublin a couple of weeks ago. 

Right, yes. I think it's a really good model to look at as well. 

But they, of course—. I’m looking at colleagues again to correct me if I get my numbers wrong, but the funding for the Arts Council of Ireland was €134 million.   

It's significantly higher there. 

Yes, €134 million compared with what we have here in Wales. 

Can I just also mention—

Yes, certainly. 

—we run a project called the Film Hub, which is funded by the British Film Institute? The Wales Film Hub is run from Chapter. The Wales Film Hub gets the least amount of money, proportionally, from the BFI, because it’s done on population. So, our Film Hub manages film, investment and support across the whole of Wales, and we get less money than the west midlands hub. 

That's interesting.

So, it's really difficult.

Okay. I'm grateful to you for that. Thank you.

Thank you very much. We are out of time, so we'll be writing to you all, please, with some of the questions that we didn't have time to get to. Could I, cheekily, ask, even though we are out of time, if any of you have any burning points that you would like to make? At the moment in Wales, we fund national companies through the arts council, but, in places like Scotland, the national companies get money directly from the Government. Is there anything that any of you would like to say in the next minute about whether you think that there—? Or, if you'd prefer to write to us, that's absolutely fine. I just wanted to give you the opportunity if anyone did want to come in. I don't see that anyone desperately wants to come in on that. I'll ask you to write to us with that as well.

Thank you so much, and we'll be in touch with some follow-up questions. Thank you very much indeed, all of you, for your time.

Thank you all so much.

Thank you.

What else could the Welsh Government do beyond additional funding to mitigate the impacts of reduced funding on the publishing sector?

That's a very welcome question. There are a number of things. Our publishers obviously create products, and these products are for sale. We have our own warehouse where we have 11,000 titles, some 1 million books. One of the immediate interventions the Welsh Government could do, which would not just benefit publishers, but would benefit schools and libraries, is to invest in buying books. You may or may not be aware that there are schools now that don't have any books. There are two new schools, one in Merthyr, one in Carmarthenshire—new schools—and there isn't a single book in those schools. The schools don't have libraries any longer. This would be such a welcome intervention. You would be supporting a product you've already funded, you would not only be supporting schools and getting good books in the hands of our young learners, but, because of the way the books council works as a charity, you would also be supporting local booksellers, because wherever we have a scheme from you that is a schools or libraries scheme, we include bookshops. So, the schools or libraries nominate a bookseller who benefits from that sale. So, this is the whole supply chain and, of course, immediately, other beneficiaries would be the publishers, but authors get royalties, designers get royalties, so there is an immediate impact. It is also something we can deliver very quickly, because the books exist. We have the logistical capacities in our warehouse so that, if you were to offer me £1 million today, I'd be getting those books out of the door before Christmas, and that is one of the few times where the model of publishing is actually to our advantage, being able to deal with underspends quite quickly. We have been fortunate in the past to have had that.

Now, in a more strategic way, I think the Government has an absolutely crucial role to play to develop a serious strategy about making Wales a reading nation. We need to look at other countries, such as Finland, with one of the highest borrowing rates from public libraries in the world. We need to look at the nations that top the programme for international student assessment, what they do, how they engage their young people, and people who have lost the habit of reading. So, this is, in my opinion, a 10-year strategic intervention that is needed. If you had a chance to look at our strategic plan, it all centres around reading, because there's no point in publishing books if nobody reads them, and, of course, that's the whole purpose—so, a really serious, evidence-based approach to a sustained reading programme that includes schools, libraries and other stakeholders, and that treats both languages equitably, because, of course, the reading standards are equally as dismal in English as they are in Welsh. So, this needs to be a really holistic approach, and we would be very, very interested in partnering with a number of different organisations.

Lastly, I think—this is a bit of a thorny issue, maybe—the Welsh Government should be looking at what flows of money reach England for the preparation of schemes or engagement that could be delivered through home-grown and existing organisations. I think this is repatriating the Welsh pound to support the Welsh economy. It's probably, in my sector, not all that much. Fourthly are the procurement policies of libraries in Wales. At the moment, as far as I know, a very small proportion of the Welsh book market, which is estimated to be £69 million—our turnover is £3 million, so you get the drift—flows to England through the use of English wholesalers to provide services to public libraries, and could there be some investigation as to whether procurement could be favouring those who have the technology and the ability to deliver those services in Wales?

Thank you. The arts council called for culture and arts support to become a statutory responsibility. Do you support the call and, if so, how would this help the sector?

In principle, I support it, but libraries already are a statutory duty, and we are losing, across Britain, thousands of libraries, or have done in the last decade. So, just because it's statutory doesn't mean that the engagement is there. I think it is a question of how you phrase it. In the libraries Act, it's phrased loosely enough for councils to absent themselves from the responsibility of providing library services. But, of course, yes, it would be a good way of protecting it.

In terms of how it would impact on us, we have seen the impact of library cuts. We have seen the impact of less budget available for schools. So, of course, once those budgets are protected, that would immediately mean more sales of the books you have funded already, and more income for our publishers, who are then less dependent on public sector funding, and, to some extent, the books council, because you may have noted in the figures that we receive about 50 per cent of our income from you and the other 50 per cent is derived from our commercial activities. And, of course, if we have more sales, the distribution centre becomes more sustainable and can sell more and, therefore, reinvest more in the sector, which is what we do as a charity.

I've been on the Local Government and Housing Committee, and I think it's the 1964 Act for libraries, but they said that if you just have two books in a building, that can be classed as a library, although some local authorities believe that it does give more protection to library services than, perhaps, leisure services, because they're not statutory. So, I think that's really where the question was coming from. So, culture and arts and leisure, really, holistically, if they were statutory services, perhaps that would give them a little bit more protection and that Act maybe isn't strong enough at the moment to protect them. So, I think that, really, is where I was coming from. But, thank you for your answers.

I would agree that, if it's protected, it's less likely to be cut. I was listening this morning to the previous session and I think the issue, really, is of taking it seriously and not seeing it as a nice-to-have luxury, but something that is fundamental and foundational to the well-being and economic success of any nation.

Okay. Thank you.

How would you describe your relationship with the Welsh Government? Do officials and Ministers understand the condition of the publishing industry and its needs? Thank you.

We are funded, of course, through Creative Wales, and I would describe our relationship with officials there as excellent. We have very close contact and we share a lot of information. Of course, I also am on the board of Creative Wales, so I have a lot of opportunity for cross-sectoral ideas. I think they're excellent, they're very committed, they have been very supportive.

In terms of the Welsh Government, I think it's the fundamental issue of culture and the creative sectors being a soft target. And whilst I have some sympathy that, of course, core services like health and education need to be protected, I think it is often poorly understood the immediate and direct contribution we make to those sectors. One of your own Members, Sarah Murphy, was with us at the distribution centre in June and she mentioned that her public health board voiced concerns about the failing of public health interventions because of the inability of people to understand the written content that is given to them. So, with a leaflet about how to manage a chronic condition, or vaccination schedules, or what have you, you have to be able to read to actually engage meaningfully. So, this is a direct contribution to the health portfolio. And then, of course, again, books and schools are kind of things that just go together; I mean, I don’t even have to make a point here. So, I think your colleagues in other portfolios have an enormous benefit from the infrastructure that is already funded through that, in a very small way, but they build and they benefit from that. And maybe there should be some more recognition of how they benefit from this. I mean, in the health portfolio, we are in the fifth year of delivering the Reading Well scheme in Welsh. This next tranche is going to focus on very young children and parents. Last year, we had an Alzheimer dementia list—the first time making these books available in the Welsh language. So, there's an enormous amount we do that maybe is not immediately obvious to other portfolios.

Thank you. You talk about collaboration and cross-portfolio working, which, of course, makes sense, but to what extent should the Welsh Government's draft culture priorities, which were consulted on over the summer, help cultural bodies mitigate the impact of reduced funding? Thank you.

I think you can only mitigate if you have slack in the system, and I think it's fair to say that, over the last 10 years, if you look at the reduction of our staff, this was a mitigating factor. We outsourced HR and payroll to the local council, so they provide those services—they're paid for, but they are more affordable than if you had in-house staff. So, the issue is that we, as arts organisations, can only mitigate if there is something we can improve and strengthen. We're looking at the use of technology and AI in particular in our field—how we can do this. Of course, the truth of this is that we are losing, in my case—. The books council is a 100 per cent Welsh-speaking organisation, based in Aberystwyth; these jobs have a premium, and all of those efficiencies that you use to mitigate cuts lead to job losses, and of jobs that do carry a premium where they're located. So, it is cuts on top of a decade of austerity and standstill funding that makes this such an existential issue for us at the moment.

My background is commercial, so I have applied a lot of commercial principles to the organisation, and one, in the distribution centre, is that the easiest way to make money is not to spend money and to control your costs. This is against rising paper costs and pressure on us to decarbonise our supply chain. So, just to give you an idea, the tape that we use to seal our boxes is now paper based and is twice as expensive as the plastic version previously. We use paper packing material—twice as expensive. So, we have a lot of pressures from decarbonisation and environmentally friendly practices versus rising costs and declining funding, and, importantly, declining sales to the educational and institutional sectors. And what I would like to see is that Keynesian intervention of, 'Right, we're going to invest in something that has a legacy; any book that you will put in a school will be there for many years—they don't disappear after a year.' So, for a relatively low-cost item, you have an enormously long tail legacy. 

A very good point. How would you seek to mitigate the impact of declining grant levels for magazines and other publications on the working conditions of people running them? You've touched on it a little bit.

A very good question. I think the publishing industry—because I don't know anyone who is in to make a lot of money—tend to be people who are in it because they believe in it, and they have a bit of a mission. There is a great degree of self-exploitation happening already, so people work way longer, in my organisation and almost every publisher I know, than they are paid for, and there's only so much you can do.

We ask this question in any tender application, 'What would you do if you received less funding?', and, inevitably, the answer is, 'Less—less output, less content, less frequent magazines, fewer books, easier books, less risky books.' Because we produce something, it's very measurable, and that is the only way we can help publishers to mitigate it, other than also, of course, trying to help them to develop their skills, to find the tiny efficiencies that are available in organisations that are usually less than five people in part-time jobs,—often women in part-time jobs in rural areas. So, other than that advice and guidance, and then accepting—. When applicants or recipients come to us and say, ‘Look, we can't do this any longer at this level’, we have to accept it, because when they give us the figures, we will say, ‘Okay, originally we wanted you to do x amount. We have to do less’, and of course this is already showing in the figures I provided to the committee, that they have to do less, and this is the only mitigation mechanism we have, unfortunately.

Thank you. Could you outline the process you followed to distribute funding for magazines in recent years, and how you ensure transparency and objectivity? Thank you.

Of course, you had a lot of correspondence from me on this point, but basically every four years, other than COVID—we didn't run a franchise round during COVID because we felt it was unfair to put that pressure on grant recipients—but usually every four to five years, the sub-committee, which is independent—. We have two sub-committees: one for English language, one for Welsh language. The English language one will look at the tender documents of what the provision is for, whether there are any changes, how they would like the provision. Over the years, of course, digital has come into that. That wasn't the case when the franchise rounds were created many, many years ago. And so the documents are discussed and agreed in the sub-committee. The tender is then openly advertised.

Typically, we give applicants an opportunity to talk to our officers about the applications, because we are very keen to see new entrants, to have the opportunity to at least engage with it and to discuss their applications as much as can be done in terms of the process. Then there will be a deadline for the submission of a written application, which we have tried to make easy, to lessen the administrative burden, to use clear language so that it is accessible, which is then followed by an interview.

In this last round, the entire sub-committee attended the interview. Two external experts who are running independent magazines in England and Scotland were part of the interviewing panel, as was one of our trustees, who is a lecturer in publishing studies at the University of Stirling. She happens to be one of our trustees and was seconded by the board of trustees to attend those interviews. And then, over two days, we interviewed nine applicants, and four applicants were successful, five were unsuccessful, and this left an unallocated sum.

When the sub-committee then looked over the provision supported through the four successful applicants, it decided that it was a literary criticism and review magazine that was needed, and that was then advertised in the following months. We interviewed in July, and we've just recently awarded the successful applicant the application. And they are actually here at Frankfurt book fair at the moment with sample copies, and reaching out to international audiences, because of course that's what we want this magazine to do—to reach the world with the best writing from Wales. So, yes, that broadly outlines the process.

Diolch. Thank you, Chair.