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Scottish Arts Council Review of Building-based Theatres Final Report (PAL8) Report written by Erika King and Matthew Rooke for the Scottish Arts Council. April 2001 Scottish Arts Council 12 Manor Place, Edinburgh EH3 7DD Telephone 0131 226 6051 Facsimile 0131 225 9833 Typetalk please prefix number with 18001 Help Desk 0845 603 6000 (local rate) E-mail [email protected] Website www.scottisharts.org.uk CONTENTS PAGE NUMBER ACKNOWLEDGEMENTS 2 SUMMARY OF THE VISION 3 SUMMARY OF THE RECOMMENDATIONS 6 THEATRE VISION SCOTLAND 9 1. INTRODUCTION TO THE FINDINGS 22 2. DISPOSITION OF RESOURCES 27 3. RECENT TRENDS 46 4. BEST VALUE 70 5. THEATRE VISION SCOTLAND: A REPRISE 79 6. COMPARISONS 85 7. NATIONAL THEATRE INITIATIVE 92 8. WHAT SHOULD BE THE NATURE AND SCALE OF ANY ADDITIONAL INVESTMENT IN THE SECTOR? 95 9. BENCHMARKING 98 10. CONCLUSIONS 106 2 ACKNOWLEDGEMENTS Although responsibility for the contents, conclusions and recommendations of this report are completely our own, the process of this review has been a truly collaborative venture: it simply would not have been possible without the advice, support and guidance of a wide range of people, from across the spectrum of the drama in Scotland. In particular we would like to acknowledge the valuable contributions made by Tricia Coe and more recently Kirsty White, who made up our administrative support team here at SAC; Sarah Coleman, Len Paterson and John Anderson our Research Associates, who contributed extensively to the statistical analysis and digest of statistics; the staff of SAC for providing such an extensive range of material at our frequent request; the Review of Theatres Steering Group and colleagues from the National Theatre working group who provided a forum within which to share and test our ideas, The Museum of Scotland, who provided such a welcoming and conducive environment for our work on Theatre Vision Scotland; Martin McCallum, Vice Chairman of Cameron Mackintosh, who so ably guided our deliberations there; and last and most importantly of all, the artistic and administrative leaders of each of the theatres who despite the extremely tight time-scale and considerable ongoing demands engaged so constructively and contributed so fully to our work. Erika King & Matthew Rooke April 2001 3 SUMMARY OF THE VISION A Review of buildings-based producing theatre companies in five years time would still reveal a diverse array of companies but common to all would be: 9 The ability to deliver an extensive range of material, embracing classic texts, neglected masterpieces and modern work, in a style and scale commensurate to its original conception 10 The capacity to engage with new work in a comprehensive integrated manner, teasing out talent and fostering creativity at a local level in all areas of theatre activity, right the way through to main stage productions and beyond 11 The resources to mount sufficient productions and performances to sustain such a programme of work on a year round basis, and at a range of times which reflect increasingly diverse contemporary leisure times 12 The capacity to explore new artistic boundaries, both within theatre and across art form divides 13 The facility to engage in true collaborations with other arts companies working in their venue, in a way that maximises benefits for the visiting company, the host company and the audiences which they serve 14 An adequately resourced and rewarded creative, technical, craft and administrative staff base with which to support such a programme 15 An effective training and development programme to support the professional and personal development of each and every member of the company 16 Buildings and public spaces that are equipped and regularly updated to meet the challenges of an increasingly sophisticated and technically advanced leisure market 17 Provision of the means by which the sector can engage more fully and creatively with the commercial theatre sector and other creative industries as a pro-active partner, enjoying commensurate rewards 4 18 Inbuilt resources to help underwrite creative risk and to foster commercial flair 19 The staffing and operational resources and a commitment to engage with a wide range of socially desirable objects through: 19.25Youth and other community activities 19.26Formal education curriculum support and delivery 19.27Social inclusion partnerships 19.28Mentoring/supporting particular sectors of society 20 The ability to be an effective partner and focus for: 20.25Economic Development 20.26Tourism 20.27Business communications 20.28Training and development for the business and wider community 9 The resources to meet the challenges of an increasingly sophisticated leisure market in terms of: 9.25Comfort, ambience and secondary leisure facilities 9.26Technical resources to improve efficiency as appropriate to each area of activity (on stage, back stage and in the office, etc) 9.27Fully exploiting the new media as means of promoting and sustaining audiences and supporters, and developing ancillary income sources 9 A new partnership with the funding system of which the hallmarks will be: 9.25A renewed sense of trust and mutual respect 9.26A funding framework which acknowledges the particular features and requirements of sustaining buildings-based companies 9.27Reduced bureaucracy 9.28Greater clarity and cohesion of objectives 9.29A more strategic approach to funding timescales 9.30More freedom from “processes” to deliver these outcomes 9.31Enhancement of the unique contribution that funders can make as strategic agencies through being freed from lower level bureaucratic burdens 5 6 SUMMARY OF RECOMMENDATIONS Recommendation 1: Extending the number of buildings-based producing theatres should not be a priority for addressing gaps in geographic provision. Rather we would advocate the development of comprehensive local drama strategies, within the context of which it may be appropriate for existing buildings-based producing theatres (not necessarily to the exclusion of other potential providers) to develop and deliver a range of products suitable to local needs. Recommendation 2: SAC should offer firmer guidance in respect of strategic artistic policy to ensure that people throughout Scotland are treated equitably in respect of generic issues such as equal opportunities and provision for young people, as well as in terms of overall range of repertoire, etc. Recommendation 3: It is recommended that SAC, In consultation with the sector, develops more sophisticated mechanisms to monitor and analyse audience trends on a more systematic and scientific basis Recommendation 4: SAC in partnership with other stakeholders should take swift action to ensure that the skills base is: 10 Adequately resourced 11 Suitably remunerated 12 Able to access resources to facilitate and encourage professional and personal development across all areas of activity In order to ensure that the sector can be seen as a valid, sustainable and desirable career choice. Recommendation 5: Given the theatres’ own efforts demonstrated so far in respect of increasing yield whilst surviving significant real terms cuts, it is recommended that sufficient financial resources be granted to the sector to address the fundamental fixed and related costs of running a full-time, fully-utilised building- based company, coupled with access to appropriate funds to underwrite creative and commercial risk on a strategic basis. Recommendation 6: It is recommended that SAC regards cutting funding to existing companies as means of investing in other members of the grouping as a tool of the last resort. Rather it is recommended that SAC actively seeks additional resources to invest in the sector and fosters self-help through new ways of exploring practical collaborations, reaching out into the wider sector to: 7 13 Achieve greater operational efficiency, sharing and utilisation of resources 14 Reduce expenditure 15 Increase the collective buying power of the sector Recommendation 7: That SAC gives priority to encouraging the development of commercial exploitation of the theatres’ resources, particularly in the context of commercial theatre and the other commercial creative industries applications by means of reducing administrative burdens so as to: 16 Allow individual artistic and administrative leaders time to explore and develop commercial opportunities 17 Introduce new/prioritise existing funding packages for such ends 18 Encourage other public funding and development agencies, such as Scottish Enterprise to follow suit. Recommendation 8: It is recommended that SAC makes representations and submissions to the Scottish Executive, highlighting the extensive ways in which the theatres can deliver across each of the published National Cultural Strategy Aims, with the objective of securing additional and appropriate levels of funding for the theatres and the sector as a whole. Recommendation 9: Whilst there is a strong and pressing case for a substantial increase in investment in the buildings-based companies, it is recommended that SAC should follow the Irish and English examples of any such investment being made in the context of a holistic, sector wide review of drama strategy. Recommendation 10: It is recommended that any model for the proposed National Theatre resource be subjected to detailed and independent scrutiny in the form of a cost/benefit analysis, so as to take account of potential negative operational and financial impacts that may arise for the buildings-based companies (and indeed the sector as a whole) as a result of its adoption, with appropriate mechanisms/funding being put in place to underwrite any such outcomes. Recommendation 11: It is recommended that SAC introduces a system of benchmarks as detailed in this report, to be applied equitably and transparently across the ten theatres and that the information required to operate this system is updated on a systematic and routine basis. In the process, SAC should also take the opportunity to review its current demands upon the theatres in respect of servicing the funding relationship, wherever possible seeking to reduce administrative and operational burdens. 8 THEATRE VISION SCOTLAND Although it did not take place until well into the review process, perhaps the most appropriate starting point for this report is the fruits of Theatre Vision Scotland. On 13 March 2001 the artistic and administrative leaders of the ten theatres gathered together at the Museum of Scotland in Edinburgh. This gathering had one objective: to explore the notion of a shared vision that was capable of reflecting, embracing, nurturing and celebrating each and every one of the theatres under review in a manner that presented a coherent argument for investment in their future development. This was a unique gathering from a number of perspectives. For example, the sheer diversity of the group, in terms of communities served, artistic philosophies, and individual circumstances meant that achieving a single vision would be no mean feat. Furthermore, this was the first time that the buildings-based companies had ever gathered together to participate in such an exercise. As the day unfolded however something very special happened. Out of this wealth of diverse talent and philosophies and histories, the foundations for a shared vision emerged which would be capable of underpinning these essential elements of Scotland’s theatre infrastructure. The vision has the potential to guide their future growth and development in a manner that preserves the essence of their individuality whilst delivering an extensive range of additional benefits for the art form, the theatre-going public, the creative communities as a whole and the wider community beyond. This report therefore takes this vision as its starting point and holds it as a constant reference point throughout. If one accepts this vision as a desirable goal and recognises the unique and extensive contribution that buildings–based companies can make to our cultural, economic, civic and social life it follows that, as a matter of priority, action must be taken to bring such outcomes to fruition. To do otherwise would simply mean turning the pending crisis that has been universally acknowledged within the sector and by its funding bodies into a self-fulfilling prophecy. Given the immense value offered by the sector this would be a tragedy, not just for the arts in Scotland but also for Scotland as a whole. 9 A SHARED VISION FOR BUILDINGS-BASED PRODUCING THEATRE COMPANIES In its ideal form, a buildings-based theatre company can deliver a comprehensive and richly varied range of benefits on a number of levels. Although there will always be local variations and shifts of emphasis that arise from the diverse range of theatres under review the following sets out the key ingredients of a shared vision for a template for the “ideal” buildings-based theatre company in Scotland. WITHIN THE ARTFORM In terms of access to the art itself, there is a dual role of creating access to a shared cultural heritage whilst also providing a showcase and springboard for new and emerging talent. This dual function reflects the symbiotic relationship that exists between new work and the rich theatrical heritage that is available to us, which we separate at our peril. One of the vital functions of any buildings-based company is in introducing a community to key works of the established canon of classic and modern dramatic work, thus connecting audiences with both their own cultural heritage and helping them connect with wider contemporary, and often international, culture. Whilst in other art forms there are separate bodies, such as museums, galleries and libraries that have separate remits for sharing access to our cultural heritage, quite distinct from the activities of bodies such as SAC and the organisations that it funds in these sectors, the fact of the matter for theatre is that such work can only be truly accessed through the medium of live performance, at which stage the notions of “old” and “new” work dissolve (as each new production of even the most established warhorse offer the potential of a fresh and insightful creative journey). Buildings-based companies therefore often provide the only sustained means of access to this aspect of our cultural heritage. If as demonstrated at the outset of Scotland’s National Cultural Strategy, minding our past is to be given equal consideration to creating our future, the ability to present and explore the core works of the dramatic canon at an appropriate and fitting scale must form a key part of any vision for the future. In an ideal future therefore this would mean that no director would rule out a production of say, Shakespeare or some similar key historic work, simply because the number of actors involved would endanger the entire season or the very company itself. This issue of being able to present work from the established canon of our theatrical heritage is not simply about the freedom of artistic direction or about creating access for audiences: it is about nourishing the profession as a whole. The ability to present such work creates opportunities for actors to engage with core repertoire in a contemporary context at a scale that creates new opportunities and sets fresh challenges in terms of ensemble work, be they an established actor getting to grips with a major role, or a newcomer getting their first break and, in the process, observing and learning from the ranks. This is not only more rewarding for actors in terms of the job at hand. It also enhances their future employment prospects. 10 These benefits similarly flow to other members of the creative and technical team, where often the challenge of rendering, say, epic-scale scenes and events within the context of contemporary theatre spurs creative imagination and craft skills to new heights. (However intrinsically rewarding, a sustained diet of one-set four-handers often offers limited scope for such challenges). Moving beyond the creative and technical spheres, the ability of theatres to present high impact productions which celebrate the unique qualities of having live artists giving exhilarating performances on stage with designers being able to deliver breath-taking “coups de theatre”, sends positive energy throughout the whole company, be it the marketers and fund-raisers who have products that begin to sell themselves, through to the box office staff who are picking up the buzz from word of mouth sales, through to the janitor who, on reading the rave review in say his or her daily newspaper, gets the personal satisfaction of being part of something that is special, that is making a difference. But there is much, much more than creating access to a shared cultural heritage. A buildings-based company, through its ongoing relationship with the public and through the trust it has developed with its audience over the years, is capable of taking risks with the development and presentation of new work, new talent and new ways of working in a manner that smaller-scale and project-based companies are often unable to achieve. For example, once paid for, an ensemble company (or similar group of actors who have developed a level of inter-personal understanding and trust) can also be a resource for testing and developing new work through readings, workshops and studio-scale performances. Such a resource can also benefit emerging directors and designers who seldom have the experience of working with first-rate performers outwith career “make or break” commissions. The security and resources of a buildings-based company could provide the ideal environment in which the process of new work and nurturing new talent can unfold at its own pace without it being dictated by the necessity to present every single work on stage. Rather such a process would enable writers and directors to be able to discard “journeyman” work, move on and learn from the experience and allow theatres to present only work that they believe truly demands an airing. Whilst issues of range and quality of repertoire and innovation and fostering new work are of major concern, it is vitally important to remember the value of basic marketing principles such as continuity and an ongoing presence in the market place. It is self-evident from the impact on audiences of the various closures and disruptions experienced by the sector during the period covered by this review that there is little value in investing considerable resources in a building and in the creation of a dedicated artistic, technical and administrative team if the building is to be dark for significant periods of time purely on account of financial expediency. A further key element of the vision for the future therefore is that companies will have the 11 facility to sustain a programme of work appropriate to meet audience and wider community demands across the course of the year. This is not just in terms of current conventions but also in terms of being able to offer performances at various times of the day to take account of the increasing number of people in our society for whom the old conventions of a 9 to 5 working day are no longer relevant. Looking beyond the subsidised theatre sector, we can see that when properly resourced, buildings-based theatre companies have played a vital role in testing and developing new product for the commercial theatre sector. There are numerous examples in the UK of companies which have been able to bear the risk of developing new work and new productions which could not be justified by the commercial sector, which have subsequently more than paid for themselves in terms of tax revenues and, of particular importance, royalty revenues for the companies in question. It is clear that there is a healthy degree of commercial creative acumen in the sector which could, if supported by some form of creative “risk capital” be used in a strategic manner to meet these needs, with all the benefits that would accrue from such initiatives. Whilst there are sound arguments for the support of theatres that are dedicated to single issues, such as new writing, it should be clear from the above that new work is not their sole preserve. The inbuilt ability to support and present new work could be a vital part of the vision for all of the theatres, however apparently traditional they might seem. This is not only on account of the benefits discussed above but also because of the role the building itself plays in sustaining and nurturing audiences. A buildings-based company is often the one fixed point of reference for the public in respect of drama provision in their community or area (and, as can be seen from the theatres under review, it is often the sole focus for high quality performing arts as a whole in their community or area). As such, the capacity to deliver new work is an essential ingredient in both leading existing audiences who have come to trust the venue into new areas and in delivering products that might appeal to a new one. It must be stressed however that the development of new work is a complete issue. It must be appropriate to the context of the individual theatre and its artistic team. When one is dealing with issues such as social inclusion, ethnicity, gender and disability, it is very often the case that new work is the most appropriate way of working as it provides an opportunity for people to create work that actually fits and reflects their concerns and circumstances without constantly trying to work through the means of a historic repertoire that is ill-suited to their purposes without extensive or perhaps obtrusive mediation. If a theatre is to be able to reach out to creative talents of the wider community therefore, whatever its location, it must have the resources to support this through new work. In short, without the capacity to support and deliver new work in a holistic manner the buildings-based companies run the risk of becoming stale and ultimately marginalized. 12 The buildings-based companies also act as the repositories and training grounds for the sector. They are a major source of trained technical and craft workers for the profession as whole. Without the buildings-based companies as a bulwark and centre of excellence, the entire profession, be it project companies, receiving houses or commercial theatres or the like would be the poorer. Given this unique role, a key element of any vision for the future will be to ensure that this capacity to train and sustain core technical and craft expertise for the sector as a whole is fully exploited with sufficient resources to enable an effective retention and training programme to be built into the fabric of the company. Buildings-based companies can also provide a career development structure for administrators and other professionals as well as representing the concentration of a wealth of physical, human and financial resources. As such they provide a training ground for individuals who subsequently go off to take on more advanced positions in touring and project-based companies and the like, and also provide a focus for aspiration for people who are seeking a new level of challenge or scale of operation to that experienced elsewhere. However, such skills are not exclusive to theatre and there is an issue across all areas of technical, craft and administrative competencies concerning the ability to attract and retain appropriate skills. In an ideal vision for the future lack of finance and poor levels of personal remuneration, job insecurity and frustrated personal development should not be principal reasons for people either leaving or failing to enter the sector. We see there being particular value in theatres discussing how they might be able to advance these issues in partnership with each other to minimise duplication and maximise opportunities for trainees. A buildings-based company’s sustained and evolving presence in a particular community reaps benefits not just for the buildings-based companies themselves but for visiting companies as well. Presenting work from other companies is an important element of the work of a buildings based company: it provides a complement to their own activities and provides a powerful tool for audience development. Visiting companies are not just hiring a space. They are benefiting from the ongoing investment in audience development, marketing and outreach work that is undertaken on a year round basis by the host company. Without this resource, considerable additional effort and expenditure would have to be incurred by visiting companies. As well as offering this service, buildings-based companies can also play a nurturing role to smaller, emerging companies by becoming active partners in the development and delivery of their projects in a way that goes well beyond a straight-forward commercial hire or box-office split. In this way they add value to the sector as a whole, remove duplication of effort and maximise investment in both companies. It is essential therefore that any vision for the future of buildings companies encourages these relationships whose objectives must be more about a mutually beneficial creative approach to sharing and collaboration rather than simply a process in which cost reduction is the number one priority. 13 The willingness to support and share within the sector is apparent from the myriad informal and ad hoc relationships that exist in relation to access to and use of facilities. The extent and nature of these relationships is often dictated by the capacity within the buildings to sustain and service such relationships. In an ideal world, the buildings-based companies would be resourced in such a way as to promote and make such services available on a strategic and equitable basis. (This may well require, however, changes in management and operational structures within the companies to accommodate and reflect a more formalised role as a resource for the wider creative community). With the benefits of receiving significant amounts of public funding comes the responsibility of providing mentors and leadership for the profession as a whole. With this comes a responsibility to make resources available and to speak out on behalf of others whose voice might not be heard or whose very existence might be put at risk should they do so. However, to do such notions justice there must be time to take these matters forward on a systematic and equitable basis. To be a truly effective resource for the sector one must have the means and capacity to make such things available on an equitable and open basis. Even something as prosaic as sharing a rehearsal space or accessing a workshop needs someone to promote the opportunity, maintain a diary and manage the relationships: it is difficult to run a flagship on a skeleton crew. THE WIDER CREATIVE AND CULTURAL COMMUNITY The benefits that flow from buildings-based companies extend beyond their immediate sphere of drama. As has been noted, buildings-based companies can often be the principal outlet or resource for large-scale performing and indeed other arts in their communities. We are now living in a culture in which the biggest competitor is not other art forms or indeed other cultural events such as cinema and sports. Rather the biggest challenge is from the stay at home/self-interest activities. As well as providing an outlet for arts activities such as dance, live comedy, music, book and poetry readings, storytelling, craft-display and sales and visual arts exhibition spaces, for example, the theatres could provide a valuable role in sustaining the whole concept of communal social gatherings. In an age in which the close-knit family unit is no longer the norm for everybody, theatres can provide the focus for social interaction and communal activities. Whilst in one sense, live theatre can be seen as an alternative to a global digitised media industry, it is also one of the principal sources of its raw materials. Government, the theatre sector and the film industry itself now universally accept the role of the subsidised theatre sector in bringing on new ideas and talent in film. (We have our very own example in the form of “Trainspotting” to show just how potent a source this can be, with a theatre helping an author make the transition from the printed page to film). Similarly, buildings14 based theatres play an important role in nurturing acting and creative talent for radio and television and the potential to do so for the newer media outlets. Given the rich rewards that can flow from such media projects and the continued growth of this sector it is vital that the theatres should have the means to be pro-active, not simply passively protecting their rights or trying to pull together a deal at the last moment, but by having the means to operate at a strategic level as a player and reap the benefits accordingly. SOCIAL DEVELOPMENT Much of the focus so far has been in relation to a vision for the prime creative outputs of buildings-based companies and their relationship to the wider theatre and creative communities. In Scotland, perhaps more so than anywhere else in the UK, artistic issues have always gone hand in hand with a concern and a desire to connect with the community at large. Accordingly there has always been a commitment to reach out beyond a core theatre audience and to deliver work of direct relevance to the lives of a wide range of people, particularly those experiencing some form of exclusion or disadvantage or oppression in some aspect of their lives. Buildings-based companies, because of their fixed position in a particular community can deliver a wide range of socially desirable goals. For example, the sector has a long established relationship with the formal education sector designing and delivering product to meet the curricular needs. They also open up their resources through their provision of youth theatre that often provides a forum for young people to address important issues at a vulnerable stage of their social development and engage with a wide range of interest groups through an extensive programme of outreach work. They can also be particularly effective in getting to the heart of the social inclusion agenda through providing a means for particular communities to explore issues directly affecting their lives, often as a result developing a sense of self-worth and social skills which enables people to articulate their concerns and needs more effectively. There is extensive evidence of the many ways in which the sector has worked across the full spectrum of social groups that illustrate the range and potential of this work. At the deepest level of engagement, companies can provide communities with the resources to explore their own concerns, priorities and objectives over an extended period in a secure and supportive environment and provide a platform for people who would otherwise have limited outlets to engage the wider community in a dialogue (as can be seen through the work of companies such as Theatre Workshop). The ability to embrace these issues is a central element of the vision for the sector. Such an approach requires commitment on the behalf of theatre leaders that may require rethinking certain priorities and also access to resources to sustain such activities in a variety of ways, be it through a core commitment to engage with the Social Inclusion Agenda, through to the support of specific, long terms partnerships in chosen areas of concern. A key part of the vision for the future is that all theatres would be equipped with specialist staff and adequate resources 15 outwith those provided by project-funding to sustain and enhance the level of service offered in this vital area of concern. ECONOMIC IMPACTS Buildings-based companies have the potential to bring forth a range of economic and civic benefits that accrue from their constant presence in a community. Besides being economically important in their own right, in terms of jobs sustained directly and indirectly through their own activities, they can be partners and a focus for a range of other economic activities, such as projecting the civic profile of their host council/communities, adding to the general amenity of town (through providing conference and social facilities or simply a great place to eat or meet) helping tourism and inward investment. They also offer a PR and marketing resource for the business community (as reflected through sponsorship) and increasingly, in an age where mainstream business is placing a premium on soft skills and creativity, a source of professional expertise to assist business meet commercial challenges. A key element of the vision for the future is that these many benefits will not only be more widely acknowledged and supported but that they can be actively pursued not only as a source of additional revenue but as part of a campaign to constantly remind the public and key decision makers of the wide range of economic benefits that can flow from the sector operating at its best. THE OPERATIONAL ENVIRONMENT If one accepts that theatre is in the leisure market, it is vital that the prime objective of offering a unique live experience is not undermined by secondary issues, such as comfort and quality of the venues and their social and other value-added facilities; the backstage technical and production facilities and the ability to seize advantage of opportunities afforded by the digital revolution to communicate and sustain interest. Whilst the lottery has proved valuable in addressing some fundamental historic concerns, primarily in relation to the fabric of the theatres, a future vision for the sector will see capital resources being available to tackle the “softer” issues of creating environments in which people want to spend more of their leisure time, the ability to explore, evaluate and adopt more advanced technologies in all aspects of the companies work, and the ability to sustain communications and promotion of the facilities on offer via the new media. 16 RELATIONSHIPS Given the importance of public investment, the nature of the relationship with funders such as the Arts Council and Local Authorities will continue to be of significance to the performance of the sector. The theatres fully appreciate the responsibilities that come with public funding and also recognise that their funders, from their unique viewpoints can add value to their efforts over and beyond funding. Underpinning this whole vision is a desire for current relationships to be recast in such a way that reduces uncertainty, clarifies expectations, and minimises unnecessary administrative burdens. Thus freed from some of the current bureaucratic conventions with regards to servicing the funding relationship, theatre leaders will have more time security and support to dedicate to achieving their full artistic and financial potential, whilst funders will be freed from some of the more quotidian aspects of their current relationship to provide real added value from a unique national and/or regional strategic viewpoint. Key signs of success in recasting this relationship will be a new mutual respect, whereby buildings-based companies are seen as desirable investments, whose particular (and often unglamorous, prosaic needs) are properly accounted for in the funding system rather than being regarded in certain circumstances as a simply a drain on resources. In return, the companies will find ways of engaging with the operational requirements of SAC and contributing to the development of new funding mechanisms that more accurately reflect the operational and planning cycles of the art form. Risk is a vital element of any artistic enterprise. However, in the future, risk should not be about whether a particular artistic decision would take the entire company down. Rather it will be about building in the capacity to take risk into the operational budgets of the companies, who in return will devise and then be judged by their own criteria and assume full responsibility for their actions. A further hallmark will be the capacity to seize commercial opportunities and to be given the freedom to pursue creative commercial instincts on both an opportunistic and strategic level. The theatres also have a role to play in being ambassadors for Scotland. There is seemingly innate desire within the sector to work and collaborate internationally, regardless of its particular area of specialist endeavour. In the future vision, this capacity will be enhanced and offer a fresh way for Scotland to reach out and promote itself internationally. 17 1. INTRODUCTION TO THE FINDINGS 1.1 In November 2000, SAC commissioned Scottish Cultural Enterprise Limited to undertake a programme of research and consultation, which had as its target the following outcomes: 19 “To ensure the most effective disposition of resources across Scotland, and address any geographic gaps which exist 20 Indicate how best use can be made of the existing infrastructure, and how the infrastructure should be supported or modified in order to deliver maximum benefit for audiences and artists and stakeholders in Scotland 21 Identify a number of models that would make the optimum use of the theatres’ resources (artistic, human, and physical) with particular reference to the National Cultural Strategy, and the objectives of the Scottish Arts Council. These models should take into account the range of functions that ,may be appropriate to different theatres 22 Comment on the appropriateness of developing benchmarks for current activity and whether it is practicable to develop Performance Indicators to evaluate the contribution of the theatres to the public in Scotland.” A copy of the brief in full is included in the Appendix F. It is perhaps important to stress at the outset of this Report that it is not a review of Theatre in Scotland. Whilst there are a number of issues touched on of general concern for the theatre sector as a whole, it has as its sole focus those theatres identified for inclusion within its remit and should therefore be read strictly in this context. The issue of the wider implications of its conclusions will be tested in the process of drawing together a wide range of reviews that are currently under way, or have been recently completed at SAC’s instigation, thereby facilitating the development of a comprehensive strategy for drama in Scotland. 9.25 The ten theatres embraced within the scope of this review are: The Arches, Glasgow The Byre, St. Andrews The Citizens, Glasgow Dundee Rep 18 Perth Theatre Pitlochry The Royal Lyceum, Edinburgh Theatre Workshop, Edinburgh The Traverse, Edinburgh The Tron, Glasgow Whilst we have looked in detail at the budgets, activities and objectives of each individual company, our report reflects the brief to account for them as a sector in their own right. Rather than attempt to add to the already bewildering range of acronyms in the arts, we will simply refer to them collectively as “the theatres” throughout this report, only highlighting individual companies where there are points discussed of particular relevance to the company concerned. 1.3 This review has taken place at a time of significant change and development for the sector. Recent years have seen: 9 The introduction of a special time-limited “Re-invigoration of Scottish Theatre” fund 10 Development of “Scotland on Stage” as one of the means of encouraging innovation and access to excellence 11 A major review of touring provision 12 A new SAC policy and Report on arts provision for Children and Young people 13 A new SAC policy on Drama for/by people with disabilities 14 A renewed interest in provision for Aberdeen 15 The introduction of a National Cultural Strategy for Scotland 16 The Boyden Review of Theatre in England 1.4 In terms of the temporal frame of reference for this review, our statistical analysis covers the period 1994/95 to 1999/2000 (although we also take account of significant developments in public funding to date). In terms of policy development, we took the publication of the Charter for the Arts as our point of departure. Appendix A, E and F give a detailed account of the methodology adopted by Scottish Cultural Enterprise as well as details of team members and associates employed during the course of the review. 19 1.5 This report takes primarily a narrative form, constructed on the basis of extensive statistical analysis and consultations undertaken during the course of this review. (This detailed statistical and attitudinal research is located in the Appendix A-D, which contain a Digest of Statistics, Subsidiary papers, and other material generated or used during this study). 1.6 The SAC brief sought answers to a wide range of questions of concern to the sector. Whilst extensive, the various questions posed in SAC’s brief can be summarised into the following four categories of questions, as follows: 9 What is the current disposition of resources? What should it be? 10 Are we making best use of existing resources? Could they be used in a more effective manner? 11 Could there be more appropriate models of provision and/or operation that could be adopted to deliver the new strategic priorities? 12 Benchmarking: is it appropriate to the sector? If so, how should it be adopted? 1.7 The current disposition of the Scottish buildings-based producing theatres under review is not the product of a directive national strategy. Rather it is primarily the result of organic growth, extending over decades. It has been driven by the passions and commitment of particular individuals at a local level, resulting in a diverse (and not necessarily inter-connected) range of theatre provision. 1.8 This unfolding story is not unique to Scotland. Peter Boyden’s English Regional Producing Theatres Report gives an excellent account of the development of repertory theatre in England since the World War II, detailing Maynard Keynes “Mission to Civilise” with the state’s assumption of public patronage; Jennie Lee’s “Mission to Socialise” with the state giving greater prominence to the arts as a tool for advancing wider social objectives; Margaret Thatcher’s “Mission to Commercialise” with the state signalling a greater expectation of the arts to sustain themselves without recourse to additional public funds; and the priorities and issues facing New Labour at a UK-level as inheritor of these various state policy objectives. At the end of his survey of the last half of the twentieth century he concludes: 20 “For over 50 years, supporting the production of drama (whether in buildings or touring) has been close to the heart of public subsidy of the arts. The funding system has not however always been clear about what it seeks to achieve from the application of public money or how the English Regional Producing Theatres should respond. Individual theatres have therefore developed their own survival strategies as the pressures have increased. The result has been an ad hoc development of a geographically skewed regional network working through a range of processes in different kinds of buildings and with idiosyncratic patterns of funding. No national policy framework has existed in which to test the relevant impact of these different funding approaches. There has been no common basis for funding partnerships in which all parties can clearly see the nature and extent of the services they are supporting.” We make no apology for citing Peter Boyden’s work in England at the outset of our report: for forty-five years out of the fifty years in question, the English Regional Producing Theatres and their Scottish Buildings-based Producing counterparts have shared a common history and operated under the same strategic framework as set out by their common paymaster, the Arts Council of Great Britain. Even though there has been a devolved arts funding system since 1995, the fundamental issues facing the sector throughout the UK have remained steadfast with little variation on either side of the border. Scottish and English theatre economies are also entwined in myriad ways at micro-economic level, with skills, services and resources being exchanged through a UK-wide marketplace. Accordingly, the English and Scottish sectors therefore not only share a common history – they also share a common future. Whilst there are indeed specifically Scottish issues to be addressed, to ignore this wider context in coming to solutions for the deeply entrenched structural issues facing the theatres would be detrimental to the interests of the theatres, the practitioners and the public that they serve. 21 2. DISPOSITION OF RESOURCES 2.1 Moving from the shared UK history to the specifically Scottish scene, the following offers a sketch of objectives o f each of the theatres under review as set out in their SAC Funding Agreements: 9 Theatre Workshop, Edinburgh: coming from a radical, community-action perspective (rather than a solely theatre one) Theatre Workshop is committed to providing a forum and outlet for marginalized people throughout Scottish society, with a particular emphasis on people with disabilities. 10 The Byre Theatre: The Byre Theatre produces and presents a summer season of plays for a local and visitor audience. It also presents a range of drama, and other performing arts by other producers. It co-produces with other Scottish producers. 11 Royal Lyceum Theatre: The Scottish Arts Council (SAC) offers support to the Royal Lyceum Theatre Company (RLTC) to undertake the programme of work as described in the organisation’s plan, submitted to SAC in September 2000. This support is offered because SAC sees RLTC as helping to achieve the following of its objectives: 9 To give people access to arts of the highest quality 10 Support artists of quality and provide appropriate conditions to promote creativity 11 Develop and sustain an appropriate arts infrastructure SAC sees THE Royal Lyceum Theatre Company as the major producing house in Edinburgh and the Lothians whose role is to provide a programme of quality work, including classic and contemporary texts, together with associated education and outreach activities. The organisation also co-produces with, and presents a range of Scottish and non-Scottish theatre companies. RLTC has a commitment to employing Scottish-based theatre artists. It offers opportunities for Scottish freelance Directors to direct main stage work, and allows audiences the chance to see the work of non-Scottish theatre artists. The Theatre also acts as a key drama venue for the Edinburgh International Festival. 22 9 Perth Theatre: The Scottish Arts Council (SAC) offers support to Perth Theatre (PT) to undertake the programme of work as described in the organisation’s plan, submitted in September 2000. This support is offered because SAC sees PT as helping it to achieve the following of its objectives: 10 Work to give people access to work of the highest quality 11 Support artists of quality and provide appropriate conditions to promote creativity 12 Develop and sustain an appropriate arts infrastructure 13 Increase and widen audiences and participation The final bullet-point above relates to the visiting programme. Perth Theatre is one of the two producing theatres in Perth and Kinross. It produces a range of text-based work for audiences principally drawn from Perth and Kinross, Fife, Dundee and Angus, in the period September to April. It also presents a range of popular touring drama by Scottish and English companies. PT co-produces with other Scottish companies. 14 Pitlochry Festival Society: The Scottish Arts Council (SAC) offers support to Pitlochry Festival Theatre (PFT) to undertake the programme of work as described in the organisation’s plan, submitted in September 2000. This support is offered because SAC sees the PFT as helping it to achieve the following of its objectives: 14.25Work to give people access to arts of the highest quality 14.26Support artists of quality and provide appropriate conditions to promote creativity 14.27Develop and sustain an appropriate arts infrastructure Pitlochry Festival Theatre produces and presents a summer season of drama that is appropriate for a tourist audience drawn from Scotland and beyond. It strives to achieve the highest quality possible. 15 Traverse Theatre: The Scottish Arts Council (SAC) offers support to the Traverse Theatre to undertake the programme of work as described in the organisation’s plan, submitted to SAC in September 2000. This support is offered because SAC sees the Traverse as helping to achieve the following of its objectives: 23 16 To give people access to arts of the highest quality 17 Support artists of quality and provide appropriate conditions to promote creativity 18 Develop and sustain an appropriate arts infrastructure 19 To encourage international exchange and promote the best of our arts abroad 20 To improve creative skills SAC sees the Traverse as the key theatre in Scotland for new writing. Its role is to commission develop and produce new plays be Scottish playwrights. It encourages dialogue and exchange between Scottish playwrights and dramaturgs, and their counterparts in other parts of the UK, and abroad. It encourages interest and understanding of, and participation in, new playwrighting among young people and others. It has a responsibility to ensure good relations with other Scottish producers, and to encourage second productions of new work. The Theatre also acts as a key new writing venue for the Edinburgh Fringe Festival. 21 Dundee Repertory Theatre: The Scottish Arts Council (SAC) offers support to Dundee Rep (The Rep) to undertake the programme of work as described in the organisation’s plan, submitted in September 2000. This support is offered because SAC sees the Rep as helping it to achieve the following of its objectives: 22 Work to give people access to arts of the highest quality 23 Support artists of quality and provide appropriate conditions to promote creativity 24 Develop and sustain an appropriate arts infrastructure 25 Remove barriers that prevent people from taking part in the arts 26 Improve creative skills Dundee Rep is a producing theatre serving Dundee City and its region with a range of work including classics, and new work. It acts as a performing arts provider for its area. It has a major Community Drama role that is delivered through its Community Department. It is also home to Scottish Dance Theatre that is separately funded through the Dance Department. It coproduces with other Scottish companies It has a year-round company of actors (separately funded through the Lottery New Directions fund), and has a role in providing product for other Scottish venues. Through this scheme it 24 collaborates with theatre artists (including directors) of international standing, whose work would not otherwise be seen in Scotland. Through the New Ways of Working the Rep also helps to promote economic development, and business investment in the arts. 27 The Citizens’ Theatre: The Scottish Arts Council (SAC) offers support to the Citizen’s Theatre (CT) to undertake the programme of work as described in the organisation’s plan, submitted in September 2000. This support is offered because SAC sees CT as helping it to achieve the following of its objectives: 28 Work to give people access to arts of the highest quality 29 Support artists of quality and provide appropriate conditions to promote creativity 30 Develop and sustain an appropriate arts infrastructure SAC sees CT as the major producing house in West Central Scotland providing a programme of quality work, including classic and contemporary texts. The organisation also presents a range of Scottish theatre companies. 31 Arches Theatre: The Scottish Arts Council (SAC) offers support to the Arches Theatre (AT) to undertake the programme of work as described in the organisation’s plan, submitted in September 2000. This support is offered because SAC sees AT as helping it to achieve the following of its objectives: 9 Work to give people access to arts of the highest quality 10 Support artists of quality and provide appropriate conditions to promote creativity 11 Develop and sustain an appropriate arts infrastructure 12 Remove barriers that prevent people from taking part in the arts 13 Increase arts for particular groups, including young people 14 Improve creative skills (refers to the Directors’ development scheme, and providing opportunities for new entrants to the profession). SAC sees AT as an entry point for people to Drama , and an organisation that offers theatre artists the opportunity to develop their skills, as well as providing a programme of quality work. AT states that the core grant is used only for marginal production costs and does not contribute to the organisation’s overheads. 25 The Scottish Arts Council (SAC) offers support to the Citizen’s Theatre (CT) to undertake the programme of work as described in the organisation’s plan submitted in September 2000. This support is offered because SAC sees CT as helping it to achieve the following of its objectives: 9 Work to give people access to arts of the highest quality 10 Support artists of quality and provide appropriate conditions to promote creativity 11 Develop and sustain an appropriate arts infrastructure We see CT as the major producing house in West Central Scotland providing a programme of quality work, including classic and contemporary texts. The organisation also presents a range of Scottish theatre companies. Tron Theatre: The Scottish Arts Council (SAC) offers support to the Tron Theatre to undertake the programme of work as described in the organisation’s plan submitted in September 2000. This support is offered because SAC sees the Tron Theatre as helping it to achieve the following of its objectives: 9 Work to give people access to arts of the highest quality 10 Support artists of quality and provide appropriate conditions to promote creativity 11 Develop and sustain an appropriate arts infrastructure 12 Encourage international exchange and promote the best of our arts abroad 13 Remove barriers that prevent people from taking part in the arts We support the Tron to produce and co-produce new and contemporary work, by Scottish and international companies nd artists; to present a programme of quality contemporary touring work from Scotland , the rest of the UK, and abroad. It is seen as an international venue with an emphasis on text-based work. It is also a resource for Glasgow-based companies through collaboration. 2.2 This brief survey highlights the sheer diversity of artistic and operational styles and aspirations of the theatres under review. This is very opposite of a homogenous sector: each theatre has evolved in response to its own community/geography and has its distinctive artistic vision. As such the factors 26 that distinguish them are as great (if not greater than) the reasons that have resulted in them being grouped together for the purposes of this review. It is vitally important to bear these separate histories, traditions and functions in mind throughout the course of this report, particularly in respect of any generalisations/recommendations with regards to the “sector as a whole” or such-like expressions: whilst there are general observations that can (and must) be made, these will not always apply in equal measure to all of the theatres in question and any actions will need to be tempered accordingly. 2.3 There are numerous ways in which one can look to the disposition of resources. This can be in terms of: 9 Geographic Spread of Resources 10 Communities served 11 Artistic Objectives The following sections consider each of these in turn. 2.4 Geographic Spread 2.4.1 Current provision of Buildings-Based Producing Theatre Companies covers the central belt and the lower portions of the Central Highlands and North-East coast. As such, the major cities and urban centres, such as Edinburgh, Glasgow, Dundee and Perth all have buildings-based producing theatres. Scotland’s third largest city, Aberdeen, does not. Nor does Scotland’s newest city, Inverness, the capital of the Highlands. In terms of other areas of the country, SAC does not fund any conventional buildings-based producing theatres in the Highlands, nor in the South-West nor in the Scottish Borders. Whilst it would be possible to apply a crude mechanistic, population based formula to govern either re-allocation of existing resources or prioritisation of any fresh funds in the sector to address these gaps in provision it is by no means clear that such an approach would be the most appropriate or indeed welcome in these various areas. 2.4.2 One starting point would be to pose the question of whether SAC’s funding is distributed equitably across the country. Broadly speaking, at the time of this review, the theatres serve approximately 50% of the Scottish population (this has been calculated by summing the populations for the various centres of population that they serve) and in return receive approximately 50% of SAC funding for drama. There are of course numerous qualifications that one could offer (for example some of the 27 drama project funding goes into communities already served by the theatres but conversely some of the theatres also use their funding to provide services for others outwith their area). However this simple indicator suggests that looked at from the perspective of population, SAC is not putting disproportionate funding into the buildings-based companies at the expense of the rest of the sector or population. We recognise that an increase in funding would shift this balance in favour of the theatres but would hope that the prospect of opening them up as resources for the whole sector on a more effective basis would go some way to address this shift. 9.25.1 Furthermore, the allocation of resources between the centres of population currently hosting the theatres is also broadly commensurate to their populations. REGION SHARE OF SHARE OF DIFFERENCE POPULATION SAC DRAMA IN SHARE THEATRES BUDGET Dundee & 8% 5% -3% Dundee Rep 7% 3% -4% Byre Theatre 17% 16% Tayside Fife Greater Glasgow Lothian -1% Arches, Citizens, Tron 15% 17% +2% Royal Lyceum, Traverse Perth and 3% 9% Kinross TOTAL +6% Perth, Pitlochry 50% 50% Table 1. Population/Drama Allocation for Theatres funded by Drama Committee, prior to transfer of Theatre Workshop from Combined Arts Whilst a more sophisticated development of this approach might yield further insight into the individual variations and “wrinkles” that may require individual attention, it would be fair to say that 28 at this level that from a geographic perspective SAC has been fair in its allocation of resources between those parts of the country who have building-based producing theatre companies and those who do not and between those centres of population who host them. 2.4.4 So what does this mean for those centres of population identified above – Aberdeen, Inverness and the Highlands, the South West and the Borders – that currently do not enjoy buildings-based producing theatres in their areas? Firstly, it must be recognised that creating and sustaining a buildings-based producing theatre company is a costly enterprise. SAC is by no means the major player in this sector. Whilst in 1999/00 SAC funded the sector to the tune of £2.9m per annum, this represented only 32% of the total funding required to sustain the theatres (and once one takes into account the ways in which Local Authorities also sustain and provide the “core plant” in the form of the actual theatres themselves, this proportion decreases further still). To deliver a buildings-based producing theatre company for say Aberdeen on either the more modest scale of Perth or the more diverse range of work delivered by Dundee would require SAC funding to the tune of some £260270,000. Unless SAC were to be prepared to assume a greater share of the burden, some £230,000 would also need to be found by the local authority. Being realistic, there would also need to be significant start-up funding, or guarantees against loss over and above these sums to allow the company to develop and present a sufficiently attractive programme of work to generate the additional, self-generated income that would be required to sustain the venture on an ongoing basis. This might need to begin at some £500,000 or so a year, tapering downwards over perhaps a three year period. Given the circumstances, simply from a financial perspective we think that it would be unwise to consider expanding the sector on the basis of creating new buildings-based theatre companies. 9.25.1 More compelling than the financial considerations, however, are the artistic and developmental reasons that people from these communities cite for not simply wishing to proceed with a rolling out of existing models of provision. For example, when talking to a group of arts development specialists from the Highlands, Shetland and Dumfries and Galloway it was pointed out that a buildings-based model was not necessarily a priority for them as regional geography and transport infrastructure meant that no one venue could realistically service the needs of diverse, often small communities. Similarly, within the urban areas of Aberdeen and Inverness a different model of provision has evolved around a major receiving house (His Majesty’s in Aberdeen and Eden Court in Inverness). These venues have developed their own ways of serving and developing audiences through their ability to programme a wide range of work, not just from Scotland but also from elsewhere in the UK and beyond. It is unlikely that the audiences which they serve would wish to 29 surrender this range of work in return for having their own buildings-based producing theatre company. Whilst both venues see potential benefits arising from a more in-depth engagement with a producing company, it is unlikely to be in the form of a full-time resident company. 2.4.6 However, whilst there is not a strong demand for the creation of additional buildings-based producing theatre companies to fill gaps in geographic spread this does not mean that there is a demand for touring product from the existing companies either. Whether it is the representatives of small scale rural venues or major receiving houses it is clear that simply extending touring of existing product would not be the preferred way ahead for their communities. From a small-scale rural arts development perspective there are artistic and practical reasons for not wishing to go down this route. 2.4.7 First, there are technical reasons why much product originated by the theatres would be unsuitable, on the grounds of size, technical requirements and appropriateness of the space available. (Whilst it is possible to overcome these issues with planning it is questionable whether the core of say a major theatre’s artistic programme should be dictated by the technical facilities of a remote rural village hall). Second, of even greater importance is the issue of relevance of material presented to both rural communities and local arts development plans. This is not to pander to any simplistic “town v country” debate about rural communities wanting “The High Road Live” whilst urban based companies are only offering drugs and deviancy. It is something which goes to the heart of the relationship between the arts and their audience: any product offered by the theatres must not just meet technical requirements, it must also allow for local promoters to contribute to shaping the product on offer as well to ensure that it truly meets their local needs. 2.4.8 At the opposite end of the scale, the major receiving houses also want more than a transfer of existing product. Their venues demand product that is capable of delivering a big impact to audiences that are used to seeing major drama and lyric theatre companies from a wide range of sources. A major concern is the absence of large-scale product with a distinctive Scottish identity that will have an immediate resonance with local audiences. Whilst the National Theatre should be able to demonstrate that to “think glamour, to think big, to think excitement, to think Scottish” is not a contradiction in terms it will (on the current model) only provide a certain amount of product. If there was a way however for the major receiving houses to get alongside producing theatres to encourage and support them in developing product that could meet these criteria and play up to the major touring venue league there might be a way of delivering this objective. As in the case of the 30 small-scale promoters, therefore, the focus is on developing appropriate product with appropriate input from the receiving communities to guarantee that the work available fits their purpose. 2.4.9 We do not considerate it appropriate therefore that SAC should give priority to increasing the number of buildings–based producing theatre companies, either by re-allocating existing resources or by prioritising fresh funds to embrace those areas of the country currently lacking such facilities. Nor do we considerate appropriate to simply offer additional funds to the existing producers to sell on their existing product. Rather we would urge SAC to engage with the local authorities and other agencies representing Aberdeen, the Highlands and Islands, The Borders and the Southwest to develop a local drama development strategy for each area. This will provide the context for the role of producing companies within these communities and the potential role that non-locally based producing theatre companies could have in the delivery of their objectives. 2.4.10 Any funding to deliver these ends should be negotiated over a minimum of a three-year period with firm tie-ins for all parties. Whether these funds are granted to the local authority or development agency or within the hands of a theatre company is not a prime consideration. Rather the principal concern should be that mechanisms are put in place to ensure that any funds invested are drawn down on the basis of joint control and responsibility, mutual respect and shared understanding of the issues involved by the artists and local community representatives concerned. 2.4.11 This recommendation flows from our observation of a number of initiatives already being advanced, such as Dundee Rep’s growing relationship with His Majesty’s Aberdeen, The Traverse in the Highlands and The Arches relationship with the Borders. These relationships could be built strengthened and extended by such an approach and would provide the framework for allowing other communities which currently lack access to the benefits which flow from a long term relationship with a producing theatre company in their midst to articulate and explore their needs. 2.4.12 This recommendation should not be confused with current project-based approaches to touring. Whilst there may be some companies that would like to develop their relationships with particular communities over and beyond one off touring dates, we think that it is essential that SAC retains a flexible market place that enables producers and buyers alike to access a wide range of product on a regular basis. Rather we are advocating a more strategic approach that will most probably operate to maximum effect through taking advantage of the resources and operational structures sustained within buildings-based companies – provided that it represents a genuine partnership in which the local community has an equal say. 31 2.5 ARTISTIC ISSUES 2.5.1 Another way of looking at the disposition of resources is from the perspective of the variety of artistic models supported. The process of organic growth within the sector has produced a wide range of models, such as: 9 “Conventional” repertory theatre model 10 Production by production casting 11 Full time, fixed-term funded ensemble company 12 A company exploiting a “found” theatre space 13 Specialist new work companies 14 An integrated theatre company 15 A multiplex theatre 16 Theatres in which drama is the principal activity 17 A theatre in which drama is the minority activity 18 An artistic policy designed to meet national/international tourism needs 19 Artistic Director-led companies 20 A Producer-led company 21 Sole providers of theatre/performing arts to their communities 22 Theatres that operate in the midst of a range of other theatre provision These approaches are not mutually exclusive. 2.5.2 We believe that SAC has done the theatre community in Scotland a service by fostering and sustaining a diverse range of theatre practice – there has been no doctrinaire or ideological policy pursued that would have rendered some of the various approaches outlined above as not being worthy of support. (Indeed, given the strength of opinions that exist around topics such as producerled or artistic director-led companies it would have been divisive and not necessarily productive for SAC to have pronounced in favour of one way or another). However, such a laissez-faire approach has not been without cost. 2.5.3 Whilst there is a diverse range of approaches to artistic strategy within the sector, it is not the case that these strategies have been adopted as matter solely of artistic choice. Rather they often reflect compromises or simply what the companies see as the sheer luck of the draw. For example, in an 32 ideal world the question as to whether a theatre operates on an ensemble basis or production by production casting should be primarily a question of artistic choice with the artistic director/leader being able to choose the artistic tool most suited to her or his needs. However, the Royal Lyceum, for example would clearly wish to be given the same opportunity as the Dundee Rep to operate an ensemble company model. Conversely, whilst Dundee Rep is able to explore this model it is only on a lottery-funded project basis without any security as to whether this preferred way of working might be sustained within its core programme. Similarly there are those occasions for a number of companies when directors cross-cast not because this is absolutely ideal but because in part in makes the finances work in a way that production casting would not. 2.5.4 The role of new work and innovation is also point of concern. Whilst there is one theatre, The Traverse, which is dedicated to new work and has assumed the mantle of being the national centre for new writing, all of the other theatres see new work and the need to nurture innovation as being essential to their artistic health for a wide variety of reasons. For both the Royal Lyceum and the Citzizens’ there is a compelling audience and professional development need for them to be supported in delivering new and innovative work at full-scale on their main stages. The logic of this however is that they also need to be supported to bring talent up through the organisation via writing and creative direction workshops, readings, studio-scale work and the like. Both strive to undertake such work wherever possible but often their capacity to think long term and take risks is circumscribed by short-term financial realities. This capacity to deliver new work is equally (if not more) of an issue to those theatres such as Perth, Dundee, The Byre and also Pitlochry who represent the sole source of professional theatre provision in their communities. As in the cases cited earlier, the process of developing talent and stimulating audiences and leading them into fresh artistic fields demands “joined-up” thinking with regards to product development, marketing, audience outreach and the like. It also requires a funding environment that does not drive people to put work on stage and recognises the high levels of natural wastage that are intrinsic to the process of developing new work. In short, new work and innovation is not a discrete specialist activity; it is a fundamental tool that should be available to all buildings-based producing theatres. 2.6 Access For Communities 2.6.1 Another way of looking at the disposition of resources is in terms of the various communities served by the ten theatres as a whole, to see whether there are particular groups or elements of our society who are less-well served than others. As has been pointed out above, the “laissez-faire”, or “organic development” approach to artistic objectives has resulted in some key areas of development, and 33 hence communities, almost by-passing the theatres. It has been strongly noted by a range of commentators across the sector that the biggest growth area for theatre in Scotland has been work for children and young people (as distinct from participatory work such as youth theatre). The advocates of such work cite a number of compelling artistic, developmental, and social and also financial reasons, supported by in-depth research, for giving prominence to work designed expressly for children and young people. Such work however does not feature large in the activities of the theatres as a whole. It is recommended therefore that both SAC and the theatres look closely at the opportunities afforded by such areas of artistic policy so that it can be supported in an appropriate manner. 2.6.2 The adoption of Theatre Workshop by the drama committee throws up a number of important issues. Theatre Workshop is rightly proud of the fact that it has made a commitment to running a company that integrates able-bodied actors with those with disabilities. However, just as it would be wrong to see new work as the province of only one company, it is difficult to see how the issue of disability should be left to just one company. The advent of the Disability Discrimination Act heralds a new way of thinking about and protecting the rights of individuals with disabilities. The very existence of Theatre Workshop’s approach throws down a gauntlet to SAC and the rest of the sector. Shouldn’t the issue of integration of people with disabilities be a fundamental concern for all the companies? If women can play male roles (and vice versa) and black people whites, what defensible barriers could there be for not actively seeking to open up all aspects of buildings-based producing theatres on and off stage to people with disabilities? Whilst in the past the issues of physical access and the cost of adapting historic buildings have been cited as a reason, it is not clear that such reasons will be sustainable in a world governed by the Disability Discrimination Act (DDA) and the European Convention on Human Rights. 2.6.3 The further challenge is this: disability is an important issue but so are those of gender and ethnicity. If one accepts the arguments (as one should) for the need for a dedicated company for people with disabilities why has this been given preference over one led by or exclusively for women? (The research indicates for example that the theatres under review are exclusively led by males; generally employ more males than females and are governed disproportionately by males). And where do Scotland’s minority ethnic groups fit into this, either as artists, managers or audiences? Now the issue of equal opportunities is clearly one of major complexity. However, the point that we wish to make is that whilst for a public funder/service provider there are moral (and indeed legal) rules governing these matters, the ad hoc nature of the development of the artistic strategies adopted by each of the companies has allowed inconsistencies to develop most notably with individual 34 companies adopting a lead role in different areas of activity (with some important social issues apparently falling to the wayside) and without offering the rest of the sector the means or opportunity to adopt similar tools to advance these concerns in their own communities. 2.6.4 The issue of capital resourcing is of fundamental importance to the whole issue of disposition of resources. As the Systems Three research in respect of the previous National Theatre exercise confirmed, along with ongoing TGI results, the provision of an appropriately resourced venue within easy reach of communities plays an important role in the stimulation of sustained attendances in those areas. Whilst the nature of the establishment of the National Lottery meant that pressing operational and revenue needs could not be addressed (the “fund the art not the buildings” argument), the pendulum has perhaps swung too far in their favour. The lottery has never been particularly strong on addressing the apparently low added-value capital needs of the buildings in respect of operational plant and the fabric of the building. The reductions in capital funding render it an even more unlikely source of support for routine capital expenditure such as roofing, and drainage, etc. Furthermore, the historic nature of much of the building stock means that there are fewer opportunities to reduce costs or take advantage of modern alternatives in respect of such work. There is also the issue of technical resources. There is a level of technical specification and provision that is standard within the commercial sector and other creative industries that theatres currently cannot even begin to address. Whilst some of these might be in respect of “sexy” innovations in terms of the use of new technologies in performance, there is a whole range of areas whereby there is scope for increased ease of use and productivity if only there were sufficiently flexible means of accessing appropriate capital funds. Furthermore, if one accepts that theatres are competitors in the leisure market, there needs to be greater emphasis in the area of capital funds by looking at ways in which the whole leisure experience of the venue from the moment one walks into the door is enhanced and to allow for venues to explore these issues in a creative manner. (Let alone any discussion of the role of “total new build” buildings in meeting the audience and art form requirements of the 21st century). 2.6.5 The prospect of a National Theatre as a mechanism for delivering more of the creative outputs of the theatres also highlights the potential need for continued capital upgrading of venues in communities that would not be suitable for the proposed small-scale touring theatre to fully engage with this initiative. Finally, there is also the issue of ensuring that venues are capable of catering for contemporary society. As highlighted elsewhere, in the future, the theatres could be open to legal challenge if they are seen to operate in a manner that discriminates against people with disabilities, 35 either explicitly or implicitly, as a result of their current building stock. There must be sufficient capital resources to ensure that the theatres can meet these challenges. Recommendation 1: Extending the number of buildings-based producing theatres should not be a priority for addressing gaps in geographic provision. Rather we would advocate the development of comprehensive local drama strategies, within the context of which it may be appropriate for existing buildings-based producing theatres (not necessarily to the exclusion of other potential providers) to develop and deliver a range of products suitable to local needs. Additional funding, although built into the relevant theatres annual budget for ease of planning, will also be subject to the agreement of local stakeholders, to reflect the mutual nature of the partnership. We recommend that funding for any such partnerships should be for a minimum of three years. Recommendation 2: SAC should offer firmer guidance in respect of strategic artistic policy to ensure that people throughout Scotland are treated equitably in respect of generic issues such as equal opportunities and provision for young people, as well as in terms of overall range of repertoire etc. Having established a standard level of expectation across the sector, SAC should then negotiate specific roles in respect of these issues with each theatre in a way that is seen to be open and logical to the sector as a whole, granting, in the process, any of the theatres in question the opportunity to “pitch” for taking on a lead role in a particular area of concern. Funding should then be made in accordance with these objectives for a minimum of a three-year period. 36 3. RECENT TRENDS 9.25 Before considering the issue of how the current disposition of resources might be altered or suggesting new models of operation, it is sensible to begin with a survey of what has been happening to the theatres over their recent history. In part this review has been prompted by SAC’s concern at a number of key indicators such as financial performance and diminishing audiences and the theatres concern at the diminution in resources available to them to deliver their objectives. SCE has undertaken a detailed analysis of a wide range of statistical information concerning the theatres that were in receipt of SAC drama funding over the period to provide answers to these and other questions. It is perhaps worth noting that we have had to make a number of adjustments to take account of significant variations across the period in question. For example, whilst there are ten theatres under review, two of them, The Arches and Theatre Workshop have only recently become regularly funded by the Drama Committee. The impact on our research is that these companies do not feature in the statistical information collected via the Drama Department for the research period in question. Our analysis of the full ten theatres is therefore restricted to information collated concerning the last year in question, 1999/00. There are also significant factors to note in respect of the remaining eight theatres, as the buildings of two of these were closed for significant periods (2 years or more) on account of major capital developments. The digest of statistics in Appendix A and B therefore provides analyses across various control groups of ten, eight and six theatres, adjusted as appropriate to permit like with like comparisons across the period in question. The following takes the form of “questions and answers” based on our statistical analysis, grouped by broad category headings. 3.2 Artistic What Is The Scale Of The Decline In Audiences? 3.2.1 SAC cites a decline in audiences for the eight theatres that were funded consistently throughout the period in question from 627,856 in 94/95 to 435,019 in 99/00. This represents a decline of almost one third of all attendances – a significant fall which merits exploration. However the period saw an unprecedented number of the closures for redevelopment arising from the successful introduction of lottery capital funding in general and the impact of changes in Local Authority funding as a result of re-organisation, the scale of the problem reduces considerably. As detailed in Appendix A and B, once all the closures are factored out of the equation, the sector suffered a decline in audiences of 10%. 37 What Are The Reasons For The 10% Decline In Audiences Once One Has Factored Out The Planned Closures? 3.2.2 There is not sufficient contemporary evidence available in the sector to give a definitive answer to this question. However, a survey of the range and amount of product available to the public over the period offers some plausible suggestions. The number of performances given fell by 13%, whilst the number of productions fell by 9%. The inference is therefore that the decline in audiences might primarily be as a result of something as simple as the fact that there were commensurately fewer opportunities to see commensurately fewer numbers of productions. This is perhaps an over simplification but it is supported by the more generic arts market research of companies such as System Three and TGI which consistently demonstrate that there is a core theatre audience that will turn out if it is given the opportunity to do so. If these assumptions are correct, there may well be a crisis in the sector but it is not about any fundamental collapse in public interest in the sector. It is vitally important therefore to ensure that any misapprehensions of this nature are countered in the public domain as it is clear from the attitudinal research findings (which follow) that a range of influential parties believe there is a fundamental decline in audiences for the theatres’ product, often with damaging consequences. What Sorts Of People Are Interested In Going To The Theatre? 3.2.3 Anecdotally, a number of people raised issues about their perceptions of the audience for theatre, often critically in terms of its social profile. Whilst the 1998/99 TGI results show that highest proportion of people attending plays in Scotland come from social groups AB, when one looks at the more detailed characteristics of theatre attendances against the rest of the arts sector a number of particularly heartening features emerge. Gender uptake reflects the balance of the genders in society (also suggesting that whilst there are important issues in relation to gender in respect of employment, power and leadership issues within the sector, the work created appeals to both genders). There is also a high level of interest from 15-19 year olds and 20-24 year olds, with youth audiences therefore outnumbering any other category (thus underlining the high importance of provision of work for children and young people). Again drawing on the 1998/99 TGI data, Theatre is the most popular of all of the performing arts in terms of audiences attendances: it is 3.75 times more popular than opera, ballet and jazz; 4.5 times more popular than dance; 1.8 times more popular than classical music; more popular than galleries; and perhaps surprisingly, even more popular than going to a rock/pop concert. Contrary therefore to the typecast image of theatre being a minority 38 interest, for an aging middle class audience, theatre is the most popular live art activity, exceeding a greater level of attendance amongst the general population than all other subsidised performing arts (attracting almost as many people as opera, ballet, classical music and dance combined) as well as being more popular than seemingly more “populist” commercial activities such as popular music. It also appeals to a wide range of age groups with young people achieving the highest levels of attendance by age group. Theatre therefore is in the vanguard of delivering access to the arts to the wider public. Is There Too Much Product Available? 3.2.4 It is at this point the caveat concerning the paucity of consistent and relevant information concerning audiences for the sector as a whole needs restating. The figures above show that over the period, the theatres extracted a greater yield from their activities, with a 13% decline in the number of performances only yielding a 10% decline in audiences. Qualifications accepted, it is possible to begin to address some of the questions that have been raised in relation to the mix and nature of product available. The 8 core-funded companies saw their share of total performances remain static over the period and therefore the actual number of performances and productions by visiting companies also fell over the period, thus emphasising the close integration of the buildings-based and touring companies. Given that the general trend has been for the range of product to diminish over the period of audience decline it is difficult to sustain the argument that there is over provision of product on the basis of the basic evidence available. How much of the work presented is new work? 3.2.5 Of the ten theatres work in 1999/00, 108 out of 322 productions presented and/or produced by them were premieres, representing one third of the product. At present there is little evidence to sustain the criticism that there is too much new work. Even if there were too much new work, the extent to which this is a problem for the buildings-based companies in particular is not apparent. As cited above, the general trend for productions and performances is downward with a commensurate decline in audiences. Could the quality of productions have an impact on audiences? 3.2.6 A crude measure of quality (and by no means applicable in all circumstances) is that of the amount of money spent on productions. In our research we discovered a strong co-relation to the amount of 39 money put on stage and the amount of box-office income these productions generated. In general, the more money put into product the more the takings at the box-office, with the reverse also being true. There was strong anecdotal evidence from the sector to the effect that a “cheap” production philosophy in respect of down-sizing acting, design and general production resources simply resulted in failing to deliver exciting “must see” productions and hence under-performance in terms of potential box-office takings. This evidence suggests that the anecdotal concerns of the sector are founded in fact. Give them the potential to offer high-impact productions and you will enable them to secure commensurate increase in box-office takings. (Given that for all of the theatres with one exception, core production costs generate a small net contribution to core costs, such an approach need not necessarily result in an ongoing additional burden with regards to cost of productions: underwrite the risk and it would most likely pay for itself on an ongoing basis). In its submission, Equity, highlights the fact that although audiences as a whole may have declined for the theatres under review, it would appear that there has been a significant increase in audiences for the commercial theatre, as exemplified by the performance of the Edinburgh Playhouse, which is one of the most successful theatres in the UK. Needless to say the majority of material presented at the Playhouse is originated or presented by the English commercial theatre sector which is able to offer the high quality, high impact theatrical experience that has Scottish theatre goers willingly paying handsome sums to enjoy. We would agree with Equity’s view that the scale of Scotland’s theatrical infrastructure is such that Scotland would be unlikely to be able to sustain a large-scale commercial theatre-style operation without recourse to the resources of the subsidised sector. Therefore there is a sound argument for resourcing the Scottish theatre sector at an adequate level to offer distinctively Scottish material at this scale of operation, capable of delivering the same scale of experience as visiting counterparts. What are the links with the commercial sector? 3.2.7 Whilst a number of the theatres expressed a desire to develop links with the commercial sector, there was only one commercial co-production in 1999/00. The theatres cited lack of security to plan, lack of risk capital, and sheer lack of physical time to devote to developing such relationships as being the principal reasons for this relatively low level of commercial collaboration. What is the scale of co-production within the subsidised sector? 40 3.2.8 During1999/00 there were 11 co-productions within the subsidised sector. Whilst there is an appreciation of the potential of collaboration as a means of artistic progression, people are wary that it could be used as a compromise simply to get enough product on stage at a lower price. There are also hidden costs in collaboration in terms of servicing and sustaining such relationships that often are not catered for in the package. For one company at least extensive artistic collaboration, in terms of core artistic programmme would run contrary to their entire philosophy of an ensemble-based approach. 3.2.9 Beyond on-stage collaborations, there are extensive ad hoc arrangements between individual companies in respect of access to and sharing resources. These could be extended further but the framework would need to become more formalised if one were to open up the sector as a more effective resource for the wider theatre and creative communities. What is the extent of touring in the work of the companies? 3.2.10 Touring grew over the period from 121 performances to 149 performances, an increase of 23%. This is admirable for a number of reasons: it sees a greater return being offered from existing investment; it marks a wider interest in the work of the theatres and hence raises self-esteem within the companies and respect beyond; and it helps fulfil an ambassadorial role for the local communities which host the theatres and Scotland as a whole. However, the infrastructure supporting such initiatives remains fragile. It is very often out of necessity that productions are trashed at the end of their run and so work that could be suitable is, out of practical necessity, often destroyed. There are still too few resources and security to be able to plan on a tour, or research and develop a proposition on a strategic basis. There are also generally limited production budgets so there is a financial decision in respect of the durability of the set build, etc. Even if one is able to plan and build on a more secure basis, there is the issue of storage of sets, etc and last and by no means least, there is generally little or no security to offer actors commitments with regards to extended runs, etc on a proper lead-in. (It should also be accepted however that actors might have reasons for not wishing to undertake extensive touring/tie-ins outwith the theatre’s financial ones). These factors result in an operating ethos that actively works against the notion of extracting additional value on a strategic basis by touring productions. As such, instead of asking whether we are producing too much work, it might be more sensible to ask if we can afford to work on such a wasteful, short-term production philosophy. This also has knock on effects for other parties, for example the sector as a whole loses out on a showcase for its talents; audiences within Scotland are not able to fully share in the diverse cultural products of its various cities and regions; the theatres 41 and the host communities and Scotland as a whole lose out on the opportunity to promote its work and its dynamic cultural products. Now there are many reasons why touring will not always be suitable, on the basis of suitability of the product, technical demands or simply the quality of work as revealed through performance. However, the pendulum does need to swing the other way in favour of allowing the possibility of touring to be a more realistic option in respect of a greater proportion of the work being produced by the theatres. (This issue will become particularly critical in respect the viability of a National Theatre season: unless the theatres are able to work with greater security at a strategic level, the National Theatre may find that its options are limited by being forced to make good the practical deficiencies of the current system by coming up with guarantees and “purchases” of productions for its future touring needs on the hoof). What is the nature of other arts activities? 3.2.11 In 1994/95 the 8 theatres presented 43 non-drama productions. This went down to 39 by 1999/00. This means that the capacity of the sector as a whole to serve other interests within their community also declined, thus resulting in a diminishing range of cultural products and the commensurate negative impacts such a decline has on overall audience development for the venues. What is the demand for theatre-originated educational and outreach products? 3.2.12 Between 1994/94 and 1999/00 the theatres increased their output and participants for education and outreach work from 584 workshops for 11,762 people to 675 workshops for 27,281, increases of 16% and 132% respectively. It is also worth noting that those theatres with dedicated departments and staffing and resources for such work achieve the highest levels of penetration. 3.3 Artistic Questions Summary 3.3.1 Despite initial appearances, there has not been a substantial sudden decline in audiences: the core audience for the work of the companies remains strong. The crisis rests in the area of the degree and nature of support for the core infrastructure to sustain and stimulate future growth in audiences. 3.3.2 The principal factors affecting audience size appear to be, the number of productions presented; the number of opportunities to attend performances and the quality of the work available. 42 3.3.3 The research suggests that assisting the companies to increase the number of productions and/or performances presented and enhance the quality and/or range of material presented could result in a commensurate increase in attendances, with the hint that there might even be a greater yield per total number of productions presented if they were of sufficient “high impact”. 3.3.4 Overall the sector has shrunken or have remained static in terms of other areas of artistic endeavour: links with the commercial sector are extremely limited; touring static, co-productions a limited activity; opportunities for visiting companies declining; non theatre arts activities diminishing. 3.3.5 In essence these sorts of activities depend on two things: the ability to take risks and the security to plan and enter into commitments on a strategic basis. It is not the case that such activities will automatically demand additional public funds on an ongoing basis: some may be sustainable following the injection of some initial risk capital. 3.3.6 Not withstanding the various issues detailed above, contrary to certain misconceptions, theatre remains the most popular of all performing arts activities, including attending rock/popular music and appeals to a wide range of social groups with young people achieving the highest levels of attendance of any age group. As such theatre is reaching out to the highest number and range of people of all the performing arts, so logic suggests that any public policy to achieve access to the arts should be utilising the fullest potential of theatre as one of the most effective ways of engaging with the wider public. 3.3.7 Whilst declining funding has resulted in a reduction of core product on stage, the growth of project support has helped stimulate significant growth in key areas of concern such as the Social Inclusion agenda. The variation of resourcing across the sector however means that the communities served by the theatres are not enjoying these benefits equally. Recommendation 3: It is recommended that SAC, in consultation with the sector, develops more sophisticated mechanisms to monitor and analyse audience trends on a more systematic and scientific basis. It would seem that a key thesis is that if one reduces product audiences decline accordingly. This can be tested by the converse of increasing funding for the sector to allow the range, quality and amount of product available to rise to the its previous levels for a minimum of a three-year trial period. Such an approach could not only yield up valuable information to follow the impacts of public investment but also, if shared across the sector, provide a valuable management 43 tool within the companies themselves. This should take place as a matter of priority, so as to inform the effectiveness of any additional funding granted the sector and contribute to the development of benchmarks and Performance Indicators. 3.4 The Skill Base What is the state of play with regards to attracting, sustaining and developing talent? 3.4.1 Although referred to as the core infrastructure of the sector, the creative, technical and administrative resources sustaining the sector are very fragile. According to our survey of the ten theatres in 1999/00, only two of the ten theatres employed resident designers; and one out of ten a resident lighting designer on a full-time basis. There were only two music directors on a part-time basis and two theatres employing a total of three literary managers/dramaturges. Only one of the theatres employed a full time ensemble of actors and none of the theatres employed a Director who was not also equally responsible for the general management of the venture as a whole. The sector as a whole therefore is predominantly dependent on talents that have been paid for and developed elsewhere and bought on an ad hoc basis from the open market. Whilst there is an element of choice in terms of people taking up freelance status there is also a degree of financial necessity. (It was noted ruefully by one contributor from outwith the sector that the only way one could have any chance of exercising one’s directorial talents and receive a living wage for doing so was by accepting the responsibilities of general management/chief executive status regardless of one’s real desire or suitability for such work) What are the implications of the state of the skills base for the sector? 3.4.2 Buying a significant proportion of ones artistic and technical talent from a free-lance pool is only sustainable if the wider market conditions permit. The difficulties facing theatres in attracting talent in the face of film, television and commercial work are well known. However there are also similar problems within the subsidised theatre sector as well. On the one hand, in times of “famine” in the sector as a whole, dependence on others to train and sustain one’s prime artistic resources means that one’s interests are always subservient to someone else’s priorities and decisions (and accordingly, one can never be in a truly leading or strategic position). On the other, if there is significant expansion in buying power elsewhere in the sector, it is increasingly difficult to attract and retain talent if one has extremely limited financial resources, or little to offer in the way of an attractive working environment. (One only has to think of a scenario of an agent advising his or her 44 client on two job offers – one from, say, a newly enriched “post-Boyden” English regional theatre offering enhanced pay, bigger productions, better rehearsals, possible touring/transfer plans and better general facilities and the other from a hard-pressed Scottish counterpart). How many actor/performing artists are sustained by the sector? 3.4.3 In terms of actor weeks, returns showed that the ten theatres in 1999/00 created a total of 2,691 actor and 210 musician weeks. This rises to 3,158 actor weeks if one includes those supported by Dundee Rep’s New Ways of Working Ensemble company. In terms of activities supported by core funding, the Lyceum makes the largest contribution in this area, delivering 596 actor weeks in 1999/00. Unfortunately this sort of information has not been collected on a systematic basis by SAC for all of the theatres under review so it is not possible to track trends across the period. However given that the number of performances and productions have declined over the period of the review, it would not be unreasonable to assume that there has been some form of commensurate decline in employment opportunities for actors and other performing artists over the period. 3.4.4 According to Equity, there is also a growing problem with the nature of the employment on offer for actors. As shown above, the headline figures tell us that fewer actors are getting opportunities to work and the range of productions on offer also declined over the period. At a qualitative level, it is becoming increasingly difficult and/or unpalatable for established actors to take employment on the basis of the wage deals on offer within the sector. Only the Citizens manages to pay its actors above the average UK manual salary of £324 per week (source: Labour Research) and none of the theatres comes close to the national full time earnings figure of £411.30 per week. With “minimums” being effective “maximums” for the sector, the prospect of working for less than £300 a week with subsistence payments that rarely meet the true cost of living away from home are not attractive or realistic for many actors. It is one thing to operate a single company wage as part of a coherent artistic philosophy it is another when this is simply a means of pegging fees to the lowest common denominator. The net result of these trends across the sector, again according to Equity, is that more senior/established actors effectively subsidise the Scottish theatre from income secured (or foregone) elsewhere; the spaces left are filled by young actors who are perhaps more willing to accept the prevailing circumstances as they need to work to establish themselves; whilst in a number of instances students and nominal “trainees” are brought into lesser well paid positions that once would have been delivered by fully professional actors. It is highly unlikely that any of the arts administrators reading (or to indeed, writing!) this report would wish to work on the terms offered to actors in the current environment. Equity’s own research also suggests a significant reduction in the 45 total spend on actors as a proportion of total expenditure and in its own survey of the Traverse, Lyceum and Dundee Rep’s programmes over the period 1995 to 2000 shows an increase in the number of administration staff being credited, thus suggesting that there has been a shift in priorities. This may be on account of “tooling up” to meet emerging funding system priorities, such as education and outreach work but certainly this concern certainly merits further investigation (although the overall overheads budgets do not suggest increases – to the contrary total overheads costs have fallen in real terms). 3.4.5 The relationship between subsidised theatre and the commercial and wider creative industries is generally a one-way track. For example, the investment of the subsidised theatre in acting talent often means that its brightest stars are, on the current financial model, inaccessible in the ordinary course of the theatre’s work (it is one thing to do a run in London at the Donmar for a basic company wage in between film or other work: it is another to expect the same actor to up sticks and do the same in a relatively small town in Scotland). Pay back of past favours, old loyalties and intriguing projects will only go so far in attracting top talent back into the Scottish theatre on a more regular basis. If we want live theatre to be considered as an equally valid area of activity as the more financially rewarding work on offer, we must put in place adequate resources to make the subsidised theatre sector an attractive (or simply realistic) place to work. Without this, we run the risk of their being two sorts of entertainment: a mass popular commercial enterprise, delivering talent which is well known throughout all sections of society primarily through screen based experience and a marginalized, “low rent” cultural activity, dependent on an almost monastic pool of talent, effectively tied to vows of poverty and perhaps unknown to the wider public. 3.4.6 The craft skill base is similarly under pressure. In terms of full-time employees or equivalents, the sector in 1999/00 employed an average of just fewer than 2.5 people each in making; just fewer than 3 each in technical and just over 1 in stage management. The Citz is unusual in that it eschews a full-time based approach in favour of a seasonally based model, with short term hires equating to some 25 FTEs (but remember this model depends on someone somewhere else providing sufficient employment for such staff to enable them to be available to a free-lance market place – it is unlikely that such a model would be sustainable if applied across the whole of the sector). The Lyceum and Dundee Rep represent the highest levels of staffing (but it should be noted that Dundee’s resource base is highly dependent on the fixed-term Lottery funding). When one considers these averages across the sector one becomes immediately aware that such staffing levels offer very little room for manoeuvre and smooth running depends on a range of exceptional circumstances. Illness, injury, or the departure of any one of these technical staff could (and, in certain circumstances, has) created 46 significant problems for each company in a way that is disproportionate to what should be expected. It should not be the case that a multi-million pound enterprise is at risk on account of something as simple as illness or the like of a relatively junior member of the staff. Similarly, a local “fix” has only temporarily solved issues such as the EU Working Directive by allowing hours worked to be considered over 52 weeks as opposed to a 32 week period. A stricter application of the Directive would result in additional costs and operational difficulties for the sector, in terms of bringing in additional staff and /or incurring greater staff costs to comply with regulations (although the impact of this is most likely to be even greater on touring companies). In terms of areas that are particularly at risk, there are pressing concerns in areas such as carpentry and electrics, given the high level of demand for these skills in the wider business community. 3.4.7 Retention of staff is one thing: bringing on the next generation is another. Rightly or wrongly, in an age in which the hallmarks of life for those in employment is increasingly marked by short-term contracts and a greater emphasis on self-reliance, there is an increasing emphasis on the need for employers to offer competitive packages consisting of more than just adequate wages. According to BECTU even within the theatre sector, technical and production staff can earn upwards of twice as much in commercial enterprises. From a craft union perspective, the subsidised sector is seen as a being more of a vocation than as a career (and it is worth bearing in mind that it took the advent of the minimum wage to enhance pay for some people in the sector). There is a further hard edge of reality at the entry level: students saddled with loans and overdrafts tend to look more closely at the bottom line in terms of remuneration. A profession that has the air of being a mission rather than a career might still prove attractive to some individuals but in general it does not bode well for attracting key administrative, technical and professional staff in a competitive market place. 3.4.8 For those staff currently in post, there is little available in the way of resources to support an effective professional and personal development programme. The sector itself only supports two directorial trainees and has no other equivalent training programme for other key talent. In short the sector lacks the ability to take a pro-active role in nurturing and developing its talent base, thus leaving it unduly exposed to the vagaries of others and chance. What about issues such as equal opportunities? 3.4.9 As noted above the theatre as a whole is successful in attracting female audience members but according to the snapshot taken of the ten theatres in 1999/00, the sector is skewed in favour of males, who make up 70% of the boards, 88% of the directorial talent, 73% of designers, 72% of the 47 writing talent; 58% of actors and 100% of the full-time Artistic directors. People with disabilities for example, constituted 1% of performers but did not register at all as writers, directors or designers. People from minority ethnic backgrounds fared comparatively better, constituting 2% of writers; and 4% of performers, whilst registering no appearances as designers or directors. Given, for example, the high proportion of people with disabilities as a percentage of our population compared to their involvement with the sector as a whole, the commitment made by Theatre Workshop to serve this area of concern is particularly valuable. There are also indications from development work such as that undertaken by the Traverse that a much higher proportion of female writers are coming thorough but the findings suggest that whilst this is just a one-year snapshot, without the support of five year’s of trends, these matters need to be considered very carefully by the theatres themselves and their funders to identify the reasons behind these figures and what appropriate action should be taken. Who governs the companies? 9.25.1 There is a diverse range of board structures and operational models within the sector, ranging from one company which has a board of 5 meeting quarterly through to another with 19 people which meets monthly. The issue of best governance is a major topic in itself and it is not possible within the remit of this review to express preferences for particular models. In terms of other observations however one might have expected, given the high level of LA inputs to boards and the role of SAC as an observer that the issues in respect of equal opportunities would not be so stark. There was also more than one wry comment during the course of the review that unlike some other major arts companies, the sector’s innate sense of responsibility, perhaps arising from its board representation meant that budgets were always balanced and that any risky activities were limited accordingly. As a result, the cumulative effect of each standstill grant, etc. has been the reduction in the scale, range, and aspirations of repertoire and also of the number of performances and productions being presented. This in turn has resulted in the commensurate drop in audiences. Whilst virtue is a reward in itself it has been somewhat galling for the sector to take the pain whilst seeing others apparently reap the benefits of not living within their means. Recommendation 4: SAC in partnership with other stakeholders should take swift action to ensure that the skills base is: 9.25Adequately resourced 9.26Suitably remunerated 48 9.27Able to access resources to facilitate and encourage professional and personal development across all areas of activity In order to ensure that the sector can be seen as a valid, sustainable and desirable career choice. 3.5 Questions About Finance How have the companies fared in terms of income overall? 3.5.1 Using the 8 theatres which were funded constantly throughout the period as our measure, it becomes apparent that income overall has fallen from £10.4m in 1994/95 to £9m in 1999/00. This represents an unadjusted fall of £1.4m of 14% for the period in cash terms. If funding had risen inline with inflation over the period to £11m, the real terms loss increases to 219% or some £2m. How have they performed at the box-office? 3.5.2 Total box office takings for the period have once adjusted for closures remained broadly static declining by around 3% in real terms (£3.07m in 19994/95, 2.9m in 1999/00). Whilst attendances have gone down, the yield per individual attendance has gone up from £4.89 in 1994/95 to £6.77 in 1999/2000, an increase of 38% in cash terms, and in excess of 25% in real terms. In terms of efficiency therefore, the theatres have in a period of general retrenchment made significant growth through yielding more attendances per production/programme offered, and significant growth of some 38% in terms of ticket yield per attendance. This is a considerable achievement in the face of such adversity. Are ticket prices too high? 9.25.1 However, there is a certain unease in the sector with regard to the possible impact of increased ticket yields on the diversity of audiences, with the possibility that tickets are being driven out of the reach of poorer members of society. As there is no systematic account of audience profiles for each and every one of the theatres over the period it is difficult to offer a definitive view on this topic. Whilst the Citizens has pursued an extensive cheap ticket policy, there does not appear to be any solid statistical evidence that can be subjected to scrutiny in respect of the profile and background of attendees taking up the cheap tickets. Similarly, although there was a perception that the Lyceum was an expensive theatre, the Lyceum does in fact offer a broad spread of ticket prices catering for a 49 wide range of income bands, with tickets ranging from £1. There is a more detailed survey of ticket pricing across the theatres in Appendix A (2a). 9.25.2 Often in other aspects of this review, cinema was cited as a competitor and benchmark with an aspiration that theatre ticket prices would be the same as those for cinema. At present the cheapest non-concession tickets in the sector range between £3 to £14, with a median price of around £7.50, compared to £4.50-£5.50 for cinema. However as has been demonstrated in Gallop’s independent market research for Key Note, such assumptions can be falsely grounded. Just as dining out and staying in were shown to be bigger competitors for leisure time than cinema, the notion that flat ticket price structures are something to be pursued are actually being challenged within the cinema industry itself. The cinema industry is beginning to question the one price fits all notion. Already there are differentials in newer complexes based on seat location and at a strategic level people are questioning the sense of offering an absolute must see blockbuster, with scope for significant demand with a more obscure/unpopular work. The indication is that we may see cinema complexes move away from such simple models. There is also perhaps a fundamental error in judging the economics of the theatre by the standards of a mass global entertainment industry. Not only does the notion of matching cinema prices fail to deal with the fundamental economic differences of selling a bespoke, unique time-limited product compared to those of a mass product that can be duplicated at marginal cost with an infinite shelf life as the schedules of any cable film channel will demonstrate!). It also potentially debases the value of theatre by casting it in the same frame as a fundamentally different cultural activity. 3.5.5 The research that has been done into ticket pricing, perhaps kicked off by the seminal work undertaken by Milward Brown in the early 1990’s suggests that price is not the principal factor in deciding whether to attend or not. Rather there is a whole process beginning with “what is it about”; “where is it? (do I like that place?)” “when is it?” “What time is it?”, etc. The key issue with ticket pricing was shown to be not what the top ticket prices were but whether there was a ticket available at a price that the potential attendee wished to pay. The issue was therefore of offering a range of ticket prices that facilitated this process. The notion that price is the fundamental issue governing the decisions of potential attendees also fails to take account of the fact that many people on very limited means still chose to spend comparatively large sums of money on attending popular culture events, concerts, festivals or even musicals which are often priced far in excess of concessionary or non concessionary tickets in the theatre. The key determinant in these decisions does not appear to be cost. Rather it is a more fundamental one as to whether the event is culturally relevant, enjoyable 50 and ultimately, whether it is value for money. A £1 (or even a free) ticket may still not seem good value for time and money against these criteria. 3.5.6 The other key finding of the Milward Brown research was that there were some people who would automatically wish to have the best seats and were quite comfortable with paying top prices for them (indeed they would often feel that they were getting a “cheap” experience if they were not being asked to pay such prices). To ignore this diverse range of social and individual preference dynamics in ticketing policy could not just lead to much lower yields (at a rough calculation, adopting such a policy in the sector for 1999/00 would have resulted in a potential loss of some £750,000 or so) but also dissatisfaction amongst particular sections of the market which could lead to a further loss of attendance. Rather we would urge a detailed assessment of ticket pricing policies over a three to five year period to establish quantifiable impacts in terms of cheap ticket prices (or the alternative). Our hunch is that the best approach is likely to be in offering a broad range of ticket prices geared to maximise both the diversity of attendances but continuing to ensure that those who can and are willing to pay top prices continue to do so, whilst continuing to offer a proportion of the very best seats at concessionary prices to ensure that less well off members of society were not excluded on the grounds of cost alone. What has happened to other sources of self-generated income? 3.5.7 Surpluses from trading and ancillary income fell for the control group of theatres from £568,000 in 19994/95 to £435,551 in 1998/99. It is important to bear in mind however that this downward trend was not uniform for all of the theatres with some achieving positive results and growth over the period. Again this is perhaps only to be expected. By definition, ancillary income is dependent on the prime activity of putting work on stage. If in general one has fewer productions with fewer performances and fewer attendances it is likely to be the case that this source of income will fall. How has the public funding system treated the sector? 3.5.8 Overall the income for the sector for 1999/00 broke down as follows: 9 Earned income 46% 10 LAs 22% 11 SAC Core 30% 12 SAC Other 2% 51 The principal source of income for the sector as a whole therefore was efforts of the theatres themselves through their trading activities. Total Public investment in the 1999/00 was £6,075,519. 52 Has Public Funding kept pace with Inflation? 3.5.9 No. The following table sets out SAC core funding for the period compared to inflation: Year Inflation Actual Grant Grant in line with (%) (£) Inflation Difference 94-95 2.4 2,563,900 2,563,900 0 95-96 3.5 2646,024 2,653,637 -7,613 96-97 2.4 2647,043 2,717,324 -70,281 97-98 3.1 2,706,693 2,801,561 -94,868 98-99 3.4 2,716,268 2,896,814 -180,546 99-00 1.5 2,742,778 2,940,266 -197,488 TOTA -550,795 L Table 2: Total SAC funding compared to inflation (Bank of England) As can be seen, whilst the figures show a modest increase of 7% across the period, the level of erosion on account of inflation across the eight theatres between 1994/95 and 1999/00 was some £550,000 in real terms. 3.5.10 Local Authority funding has also experienced major setbacks. The advent of Local Authority Reorganisation resulted in a sharp loss of funding. By 1999/00 Local authority funding had only reached 91% of the levels being granted in 1994/95, taking no account of inflation. (Theatres have however fared better than the rest of the arts over this period). The sector therefore has experienced a triple whammy over the period: Core SAC funding declined in real terms, trading activities were disrupted understandably by the companies’ implementation of lottery funded capital programmes and local authority re-organisation struck at one of the three pillars of their ongoing support. 53 How has SAC treated the sector in relation to other areas of activity? 3.5.11 There was considerable concern expressed at the apparent “schemification” of SAC funding, with the concern that SAC was favouring project funding over enhancing core grants. Overall SAC expenditure on drama remained static over the period at c. £4.6m. Overall, however, between 1994/95 and 1999/2000 drama as a percentage of overall SAC expenditure fell from 20% to 18%. There are well documented reasons for the additional increases in funding for SAC relating to the funds earmarked for the National Companies but it is still informative to see that the sum which would have come to drama had its share of the budget had remained at 20% would have been over some additional £500,000 per annum, which if split between the various areas of interest would have been equal to the sums lost in real terms due to the erosion of inflation in public core funding. 3.5.12 In 1999/00 and 2000/2001, the drama budget enjoyed increases of 9.6% and 9.1% respectively both of which were in excess of SAC’s overall settlement. In 2001/2002 drama received a 9% increase in funding overall (although overall SAC funding rose by 13.3% so drama had reverted to lagging behind the headline increase identified between 94/95 and 99/00). The majority of this increase was made available via a special “Reinvigoration of Scottish Theatre” fund of which 16% was passed on to the theatres under review. Furthermore, the trends within drama do show a trend away from core funding towards project funding. In 1994/95 revenue funding represented just under 60% of total funds. By 2001/2002 this stood at 48.8%, thus supporting the claim of “schemification” over core funding. The most likely way in which a buildings-based company is to enjoy an increase in funding under the current system is for it to be in the form of a short-term, competitive project award against criteria which may or may not take account of the particular factors influencing the operations of a company with the responsibilities of maintaining a building as a resource for the sector. Competitive schemes are not intrinsically bad. The key element in assessing them is perhaps in judging their suitability to secure the desired outcome and whether the schemes themselves are capable of embracing the interests and operating environments of their target beneficiaries. Seen from this perspective it is questionable that going down the path of schemes will provide suitable tools to address the particular circumstances of buildings-based companies. What was the net result of these reductions in funding? 3.5.13 The sector has been responsible with regards to striving to trade within known resources. Deficits have largely been contained at manageable proportions (and in the notable case of the Lyceum, it has 54 been converted through its own efforts and with the support of SAC’s National Lottery Advancement Programmes from a £384,600 deficit in 1994/95 to a £104,000 surplus in 1999/00). The Citizens, Lyceum and Theatre Workshop have all been granted Advancement funding as a means of assisting them to improve income generation in the future. In general the theatres have responded to these reductions in funding by reducing those areas of expenditure where they have flexibility and attempting to peg expenditure in those areas that are ongoing. This has resulted in the problems identified earlier: the only flexibility has been to scale down or cutback on productions. Total production related expenditure remained static (£2,953,072 in 1994/95, £2,933,082 in 1999/00). 3.5.14 In terms of other areas of the budget, payroll was £3,378,705 in 1994/95 and £3,411,848, a 1% rise in cash terms but a major cut in real terms given that inflation was cumulatively in excess of 14% for the period in question. Overheads fell by 7% (unadjusted for inflation) for the same period, from £1,717,449 to £1,598,594, but it is not clear the extent to which this was the result of collateral reductions in expenditure that are production/performance related or as a result of specific costreduction policies. As might be expected there are two financial currents running within buildingsbased companies: the buildings-related and core company infrastructure overheads which are invariable fixed and hard to reign in in respect of general inflationary forces; and the artistic product which is the only element where the company can exercise real choice as to what is spent. The unfortunate outcome of prudence throughout the period has been that the primary reason for the buildings being in existence to deliver has been the one area that has been forced to be cutback. How well have the theatres done in respect of Lottery funding? 3.5.15 Overall the theatres have done comparatively well out of lottery funding. Between 1995 and 2001 the theatres have received £19.1m, of capital funding, representing 42% of the funds requested and 17% of total awards, with the greater part (£18.2m) going on buildings. In terms of project funding, the theatres have received £1.8m or 8% of the total lottery funds available since project funds were introduced in 1997/98. This lottery funding represents a significant boost for the sector. It is perhaps worth noting however that the major concern over the period has been for investment in mounting sufficient product of a sufficient quality to sustain and enhance audiences. From this perspective the theatres have not done well with only the New ways of working award for Dundee Rep seeing any real money finding its way into core artistic activities. As noted above, although the total spend is a significant proportion of the lottery funds, the challenges facing the buildings as service providers in 55 an extremely competitive leisure market have by no means been fully addressed by the awards and schemes undertaken to date. It is a false assumption therefore to assume that the capital needs of theatre have been addressed for this current generation as we envisage ongoing demands for refurbishment of public spaces; adopting new technology on stage; and taking advantage of technological developments in promotion, production and administration. 3.6 Summary Financial Issues 9.25.1 Once one takes account of inflation, the theatres have experienced serious reductions in core public over the period. Given that the underlying purpose of this funding is to sustain the basic infrastructure and programme of work, there has been a reduction in programming and also in the range and diversity of repertoire. However in spite of these diminishing resources the theatres have protected artistic programming costs by increasing their ticket per attendee by 38% and achieved real terms cuts in overheads approaching 14% in real terms Recommendation 5: Given the theatres own efforts demonstrated so far in respect of increasing yield whilst surviving significant real terms cuts, it is recommended that sufficient financial resources be granted to the sector to address the fundamental fixed and related costs of running- a full time, fully-utilised building-based company, coupled with access to appropriate funds to underwrite creative and commercial risk on a strategic basis. 56 4. BEST VALUE 4.1 So far in this report we have had the opportunity to set out the current disposition of resources in broad terms and then explore key financial and operational issues through a series of detailed questions tracking trends across the recent history of the sector. This section of the report is dedicated to the issue of whether existing funding and/or resources across the sector could be used more effectively, perhaps under different models of operation. Indeed it is essential to consider whether there is any more juice to be squeezed from the current set up before any consideration can be given to issue of additional funding resources. As before the format follows that of question and answer. Is there any fat or slack in the system? 4.2 Normally one would look to see if there were any obvious areas of duplication/waste that could be driven out of the system to deliver efficiency gains. Whilst there is a diverse range of approaches to delivering theatre represented in the sector, and there are at a micro-economic level, examples of good practice developed in various parts of the sector that could be applied effectively elsewhere, such considerations are primarily about adding value rather than saving costs. Given that the theatres as a whole have reduced their total amount of productions by 13%, reduced their number of performances by 10%, coped with a fall in income of around 10%, held their overheads to just below inflation and increased their ticket yield by 13% it might be fair to say that circumstances and five years of retrenchment have very effectively driven “fat” out of an already very lean system. 4.3 The principal slack in the system relates to under-utilisation of resources. Unless fully utilised, a buildings based company will see a disproportionate amount of its expenditure go on simply keeping the facility in place and available for a limited programme of work. As our subsequent analysis will show, this resource can be utilised if there is a major uplift in basic resources without it thereby needing constant additional public funding. Our study relating to the 6 companies funded and open for business consistently through the period shows that for 5 out of 6 the theatres, putting on productions actually enables them to generate income that is in excess of production costs, and hence also make a contribution to core overheads. A shift in core funding to embrace the concept of the core infrastructure being covered will liberate any “profit” from box office to be used to promote the strategic interests of the company without necessarily resorting to additional public revenue funds. 57 Is there any unnecessary duplication in the system? 4.4 Taking the example set by Scottish Opera/Scottish Ballet, a fair question would be to see if there could be any funds released through merging or sharing activities. As that exercise has shown however there are only particular circumstances in which one can share resources and produce greater benefits all-round over and above any initial financial savings. A great deal of time in all the theatres is spent on management of and upkeep of buildings. One obvious approach would be to consider whether companies might share buildings. This issue is of little relevance to the Byre, Perth, Dundee, and Pitlochry as they are the sole operators in their community. This leaves in essence the issue of Glasgow and Edinburgh. At present the volume of activity in both sets of companies is such that there is greater demand for theatre space than could be accommodated by say just using the Citz or the Lyceum with a dedicated studio theatre space. There is also the issue of clashes for access to the facilities and suitability/scale of space for the work. (Even if there was a perfect time/availability fit for Theatre Workshop for example to use another of the Edinburgh theatres, fundamental issues of disabled access etc. would rule out such collaborations. There is also the issue of the way in which people respond to different venues and programme them in respect of complementary incoming work. Often companies looking for ways of releasing capital look to their buildings as a potential source of revenue. With the exception of Pitlochry, nobody owns the theatre in which they operate. Even if they did wish to dispose of them or release capital in some way, the market value of an A listed 19th century Theatre is likely to be very poor. As such, release or sharing of major capital resources is unlikely to be an option. 4.5 Given that the majority of talent is hired in the form of freelance workers, often at or near minimum rates there are few (if any) savings to be had in this area without continuing the negative cycle of reducing scale, range and numbers of performances and productions. Dundee could theoretically strip out around 14% of its payroll costs in respect of NI and other employer’s costs of its ensemble company but then this would simply mean a reversion to old ways of working and then one would once again prey to the vagaries of sourcing talent on a freelance model. 4.6 There are many areas where the identical functions are being carried out in the sector, such as making, props, technical staff, etc. Whilst it would be imprudent to make hard and fast pronouncements on this without commissioning a very detailed internal cost comparison exercise, it is unlikely to be the case (with one major exception, as discussed later on) that such collaborations could be sustained at a practical level. The geographic spread of the theatres is such that there 58 would be inherent difficulties with say having a theatre in Perthshire running a props service for say a theatre in Glasgow and wigs for a theatre in Edinburgh. There is also the practical factor of the barely adequate resources available to each theatre as a whole. If you only have an average of one member of stage-management and three staff in making on a full-time basis, there is barely enough staff to deliver your own core activities let alone service a joint venture for a consortium of consumers. This area is worthy of a study in its own right. We would therefore encourage SAC to facilitate a systematic process of identifying common areas of expenditure and activity and review the scope for joint action from the perspective of cost savings; increased productivity; and added value. If there is to be any collaboration of this sort it must be thought of in respect of the whole sector and not simply in terms of what is after all a largely artificial grouping of theatre companies who happen to have buildings as well. 4.7 The one exception could well be in Perthshire. We believe that of all the theatres under review, Perth Theatre and Pitlochry meet a number of key criteria governing such collaborations: There is sufficient diversity within their operating schedules to permit resources to be shared without clashing; there is geographic proximity to facilitate shared working; and there is a common local funding body to provide a coherent strategic framework for any moves toward collaboration. Any such development however must also take into account the fact that Pitlochry operates not just as a national theatre resource in the area of arts tourism but also has a key role to play in provision of resources and services for the whole of the theatre sector on account of its unique location, periods of operation and resources. 4.8 Whilst there is scope for striving for efficiency gains through collaboration, it might be more sensible to see collaboration as a means of creating added value amongst the theatres and potentially for the sector as a whole. This, as mentioned before, might be through strategic artistic developments such as addressing the childrens’ and young people’s arts agenda or through straightforward financial issues. There are for example a number of ways in which the buying power of the sector might be used with greater muscle, perhaps through group purchasing of supplies or services, such as print or advertising. For any such developments to be successful there must be a sense of full ownership by the sector themselves rather than it simply being an imposition. We would recommend therefore that SAC, in consultation with the ten theatres and the FST should encourage the development of a forum for business-to-business type exchange which would enable theatres to share resources more effectively in practical ways, as well as explore scope for joint purchasing, etc to lever better deals for the sector across a variety of services. 59 4.9 We would also recommend that a more sophisticated approach is adopted to sharing market intelligence. As the English theatre has shown, it is possible to share key market intelligence and ensure that there are mechanisms in place to stop predatory behaviour. At present the sector is littered by “dead” or under-exploited information both lying within the SAC and within the theatres themselves that could be used to improve financial and operational performance. Could self-generated income be improved on? 4.10 Yes. Sponsorship for drama is relatively small in Scotland as a whole and falls well below that of levels obtained in England. We believe that there are practical reasons such as the inclusion of the RSC and National in the English sponsorship returns but it is clear from talking to Arts & Business that sponsors do not consider theatres to offer as good a value as other art forms. There may be intrinsic reasons related to the nature of the art form in question for sponsors choosing to put their funds elsewhere. (For example, it is one thing to have the scenes of abuse and degradation taking place as depicted by an old master within an ornate gilded frame behind you as you chat with your guests at a smart drinks party at say the National Gallery – it is another to bring one of your target customers to sit through their graphic representation on stage, fifteen feet from their noses). However, given the extensive range of work on offer and the many other social benefits listed at the outset of this report, we believe that there should be further scope for winning sponsorship for the sector. We would recommend therefore that this matter is considered carefully by the sector and that every encouragement is offered to them by the funding system to “tool up” to operate more effectively in this area. 4.11 We also believe that the capacity to increase earned income from touring, commercial tie-ins and cross-media exploitation could be exploited if the companies had greater security of planning and access to either some form of “creative risk” funding, preferably built into core funding for a start up period and/or funds from other public agencies such as the enterprise and local business development network to support the more speculative areas of linkage with the commercial and creative industries sector. For example, an ensemble company might be supported by exploiting the different talents of its members in say talking books, or radio production, or providing a readings for hire service for advertising/film/commercial drama companies or, a web-based soap or drama, or a spin off documentary production company, or by developing arts-based training for the business community, etc. A technical/production team might be able to develop additional income through developing tie-ups with conference/events/trade fair-type promotions companies. These are just some ideas that might yield benefits. We are convinced from our discussions within the sector that 60 there is a lot of commercial acumen that at present is being bogged down in dealing with shorttermism and uncertainty. If one can begin to remove these unproductive burdens we are sure that this sort of commercial flair could be brought forward to the benefit of all concerned. If the 1980’s say the advent of marketing and the 1990’s the emergence of education as a major component of theatres’ work we see this first decade of the new century as being the time when we find new ways of unleashing creative potential in the commercial field and therefore recommend that SAC considers an effective means of stimulating and nurturing such approaches to self-generated income in all of the companies within its charge. Could performance be improved by changing management structures? 4.12 A number of people during the course of the review brought up the issue as to whether artistic director-led theatres were the most appropriate way of operating. Without wishing to side-step this issue, we believe that it is difficult to make definitive judgements about the producer-led model versus the artistic director-led model when nobody is able to operate to their best on account of the limited resources available and constraints under which all of the sector is operating. It might be more productive to look at the issue of how the theatre itself functions as a resource for the wider sector and community, as opposed to the “host season” productions originated under what ever artistic model is in place for delivering the core season. If in return for any increase in investment, the sector puts its role as a resource for the community on a more formalised basis, there will be a greater need to look at the potential of the theatre as a public building quite separate from its role as a home for the “in house” productions. This would cover both the service levels and support offered to visiting companies, access to other production and promotional facilities and other services drawing on the wealth of expertise within the company as a whole. We see the need therefore for someone within the organisation to become the champion for these wider interests with perhaps someone at board level being charged with the responsibility of ensuring that the company’s role as a resource for the wider sector is effectively promoted and delivered. But what about a more radical approach? 4.13 During the course of this review a number of people have put forward the suggestion that we need radical change to liberate funds for dispersal elsewhere in the sector. We think however that once one actually looks at the financial consequences such an approach would be unwise and counterproductive. First of all, as pointed out in the early stages of this report, the ten theatres are delivering a diverse range of objectives, under different models in different areas of the country. There is little duplication between functions on an artistic, geographic or on a “communities-served” 61 basis. There is also the problem of what provision would need to be put in place in respect of the various part of the country/ community served by the theatre which has had its funding cut. (For example, it would be an unusual argument that left any of the “single theatre” communities, such as Perth, Dundee or North East Fife without such a facility when they had enjoyed one up until that point, or trying to explain to, say, writers or people from minority groups that the one theatre that served their interests is being cut). 4.14 Even if one surmounted these hurdles there is the issue of the net benefit that would flow to the sector from shifting funds elsewhere. As has been shown above, whilst a major influence on the sector, SAC is a minority stakeholder in the whole enterprise, in that it only holds an average of a 32% stake in the ten theatres total income. Whilst SAC is perfectly at liberty to take its 32% elsewhere, there is no guarantee that the remaining 68% will follow. The most likely result of a radical shift therefore will most probably be the loss of one major area of theatre production as well as the loss of a facility for the rest of the sector (given the high level of work presented by visiting companies this is a major concern), and the likely haemorrhaging of more than twice the amount of money being invested elsewhere. As such SAC would need to be extremely sure of its capacity to deliver sufficient residual services to the community losing its theatre, as well as levering in sufficient added value elsewhere to make cutting one or more of the theatres a sensible option. 9.25 Summary 9.25.1 There are a number of useful, radical and exciting options that can be pursued in respect of reducing costs, increasing buying power and adding value to the sector, both collectively and through supporting individual commercial development as appropriate to each company. 9.25.2 However, simply opting to cut funding from one and give it to the other should only be seen as a last resort as the net result is likely, in the initial and perhaps longer term, period in a loss of up to twice the size of the funds liberated being lost to the sector through loss of box-office income, related trading income and other public sector funding. 9.25.3 The experience of the period in question has resulted in the theatres already increasing trading yields and driving down expenditure to the bone. To attempt to go deeper within the existing financial resource base would simply result in either the overall reduction of benefits offered by the companies to the sector and wider community as a whole, or would mean adopting a policy of short term cannibalism, with the sector consuming itself over what would be a very short period, as 62 companies were dismantled to feed the operational needs of a dwindling group of survivors. (The scale of the financial problems is such that the sector would end up stabilising at a very small number of theatres). Recommendation 6: It is recommended that SAC regards cutting funding to existing companies as means of investing in other members of the grouping as a tool of the last resort. Rather it is recommended that SAC actively seeks additional resources to invest in the sector and fosters selfhelp through new ways of exploring practical collaborations, reaching out into the wider sector, to: 9 Achieve greater operational efficiency, sharing and utilisation of resources, 10 Reduce expenditure and 11 increase the collective buying power of the sector Recommendation 7: That SAC gives priority to encouraging the development of commercial exploitation of the theatres resources, particularly in the context of commercial theatre and the other commercial creative industries applications by means of reducing administrative burdens so as to: 9 Allow individual artistic and administrative leaders time to explore and develop commercial opportunities 10 Introduce new/prioritise existing funding packages for such ends 11 and encouraging other public funding and development agencies, such as Scottish Enterprise to follow suit. 63 5. THEATRE VISION SCOTLAND: A REPRISE 5.1 We believe that in the context of what has been discussed so far that the vision that began to emerge from the Theatre Vision Scotland exercise represents the most appropriate way for SAC to progress. If SAC, and through its advocacy, other key players in public funding, such as Government, Local Authorities, and the Enterprise and Tourist networks, can find the means of increasing support and investment in the sector, there will be a wide range of added-value benefits over and above the pressing issue of restoring the infrastructure that will flow across a wide range of constituencies. Given that these benefits are desirable to the Scottish Executive in the form of the National Cultural Strategy and SAC in its own interpretation of the same, we believe that there are compelling reasons for making additional support for the sector a priority. 5.2 The National Cultural Strategy sets out five aims: 9 Promote, encourage and support excellence and innovation in the arts 10 Broaden the range and increase the numbers of people experiencing and taking pat in the arts 11 Support the arts sector to help them meet the needs of society today 12 Promote the arts in all aspects of Scottish life 13 Ensure that SAC is effective and responsive to the needs of society and the arts today The following offers an analysis of how the theatres can and do meet these objectives, taking as its frame of reference a paper entitled Aims and Priorities objectives prepared by the |Scottish Arts Council in response to the NCS. 5.4 Promote, encourage and support excellence and innovation in the arts 5.4.1 The NCS rightly considers enhancing existing structures and recognising current achievement in the arts as a major priority. We believe that the many benefits which can and do flow form the theatres, in terms of theatre, wider cultural and broader social objectives as demonstrated throughout this 64 report make concrete the reasons for doing so. The theatres under review can provide the ideal conditions for a broad range of artistic and other talent to flourish and have an important role to play as partners and supporters of creative endeavour elsewhere in the sector. 5.4.2 Scottish theatre has also played a valuable role in the promotion of Scotland’s diverse linguistic traditions and cultural traditions, as the examples of work with Gaelic, Scots language, Doric, and traveller and other minority ethnic groups demonstrate. This work not only reflects giving voice to these different traditions but also provides a forum within which the languages and traditions can be explored in a wider context. 5.4.3 The theatres, whilst strongly rooted in their own local communities also operate at a national and international level, and there are numerous examples of how they have forged partnerships with companies and communities outwith Scotland that foster a level of contact, mutual understanding and exchange that “top down” governmental and agency approaches often find difficult to achieve. As discussed earlier in this report however the theatres are very much constrained with regards to touring and international collaboration: a go and see fund for individuals ideally also needs to be supported by a “Go and Do” fund, capable of operating to a specifically Scottish agenda. 5.5 Broaden the range and increase the numbers of people experiencing and taking part in the arts 5.5.1 The principles informing Social Inclusion have been at the heart of Scottish theatre practice for a very long time now. There is extensive evidence of the ways in which the theatres engage with a diverse spectrum of the community, be it through special promotion, marketing and pricing initiatives for their work on stage; through a wide range of education and outreach projects; through opening up the resources of the theatre to youth and community theatre groups; or by engaging directly as partners with specific marginalized sectors of society to provide a forum and showcase for their creative talent. 5.5.2 Building on their extensive work in curriculum support, the theatres are well placed to support and partner the new schools co-ordinator posts. Whilst firmly rooted in local communities the theatres have demonstrated a variety of ways in which they can begin to address gaps in geographic provision through creative collaborations, as demonstrated by the work of the Traverse in the Highlands, Dundee Rep in the North East and the Arches in the Borders. 65 5.5.3 The sector also can provide a valuable resource and test bed for the development of digital technologies and has the potential to become a valuable player in respect of content production in its own right. 5.6 Support the arts sector to help them meet the needs of society today 5.6.1 The paper entitled “The Wider Context”, Appendix D, sets out in detail the challenges facing the arts in respect of the changes underway in our demographic, social, cultural, technological and economic lives. The theatres as both the providers of the most popular form of public arts entertainment and as major centres for the promotion and delivery of a wide range of other artforms in their communities could provide a useful “test bed” for ideas for meeting these challenges. It is also worth noting that these problems also afflict attendance and participation in major sports such as football, rugby, hockey and cricket and therefore there is an excellent opportunity to unite the two halves of the ministerial brief for Sport and Culture in a joint initiative to explore and tackle these threats. 5.6.2 The proposal that the sector be supported to create practical working forums, or business-to-business market places, so to speak, at which they can look to ways of sharing resources on a cost-effective basis and explore the potential of their combined buying power in respect of routine and special expenditure, give substance to the concept of networking enshrined in the NCS. 5.6.3 The issues of training and staff development are rightly highlighted as areas of concern in the NCS and it is clear from the evidence of this report that initiatives that seek to address these issues within the theatres are welcome. The issue of enhancing business skills is reflected in the discussion of fostering commercial creativity within the sector and the issue of developing proper apprenticeship schemes across each area of employment in the theatre is also to be encouraged. 5.6.4 The suggestion that the gaps in geographic provision are best advanced through encouraging local, mutually-beneficial partnerships between individual companies and communities outwith their home base, is an example of how local partnerships can be fostered throughout Scotland, as well as being a way of showing how existing resources can be harnessed across a wider geographic spread to address specific local strategic objectives. 5.6.5 The whole issue of promoting partnerships between public and private bodies is key to future success of the sector. As has been recorded above, the sector is already a major source of training 66 and talent for the commercial theatre and creative industries sector but could also become a much more active partner or service provider in its own right in respect of commercially-desirable creative products. The level interest demonstrated by business in respect of arts-based training is also a sign of partnerships just waiting to be brought to fruition between the sector and the world of commerce that have the potential to deliver additional income to the sector outwith the public purse. 5.7 Promote the arts in all aspects of Scottish life 5.7.1 The extensive range of work undertaken under the umbrella of the theatres means that they can be seen as excellent partners for making contributions across all areas of Scottish Executive policy. Their work in relation to Urban regeneration and tourism, for example is well noted and there are robust independent evaluations of this work. 5.7.2 The role in respect of research and development for the film and broadcast medias needs to be embraced in a more effective manner in respect of public policy for film and television. If the NCS is to achieve its ambitions for these sectors, any strategies governing their future support must also recognise and embrace the role of theatre as a major source for talent and innovation. 5.7.3 The extensive work already undertaken within the sector and the potential contained within experiments such as Dundee Rep’s ensemble company, means that the sector is well placed to develop and deliver live and recorded-format educational services. This could be delivered through partnerships with commercial enterprises focussing on education and interpretative materials. 5.8 Ensure that SAC is effective and responsive to the needs of society and the arts today 9.25.1 SAC, in the way it sets out policy and makes funding decisions, plays a powerful role in the thinking and actions of the sector. Its role as a commissioner and disseminator of research has the potential to improve decision making across the sector and foster collaboration in key areas such as market intelligence. The sector might also, given the range of its activities provide an ideal starting point for developing benchmarks and suitable performance indicators for gauging public investment in the arts. We would also recommend that the ten theatres could be used to pilot new ways of managing funding relationships, with the goal being to roll back bureaucracy to the barest minimum required to comply with accountability, in a manner which reflects the operational needs and culture of the sector. 67 Recommendation 8: It is recommended that SAC makes representations and submissions to the Scottish Executive, highlighting the extensive ways in which the theatres can deliver across each of the published National Cultural Strategy Aims with the objective of securing additional and appropriate levels of funding for the theatres and the sector as a whole. 68 6. COMPARISONS 6.1 Throughout the course of this review a number of people have spoken enviously of the funding accorded to theatres elsewhere, such as in Denmark or Holland. The funding available is indeed extensive Indeed it is of such a different scale of magnitude that there is little merit in the context of this review on dwelling on the many ways in which theatre is funded in these countries. The scale of funding afforded is not simply because of any intrinsic value of theatre over other art forms: there is a political and cultural consensus that has produced much higher levels of public investment across all of the arts. If there is a message from this for theatre in Scotland, it is one that extends beyond the relatively narrow confines of the review at hand. Rather the most appropriate starting point for any comparisons with other countries is within the British Isles, where there is both a commonality of cultural and political heritage; a common medium for the language of theatre; and also extensive integration of the theatrical economies. 6.2 Ireland 6.2.1 The scope of the Irish Review of Theatre included the whole of the theatre sector (79 companies and venues). Although the population base of Ireland and Scotland is similar, it is unfortunately not possible to draw many conclusions by comparing findings of the review because the Scottish exercise is limited to ten building based production companies revenue funded by the Drama Panel. However, some of the percentages are useful and are listed below. In Ireland 15% of companies are venue based production companies that also operate as receiving venues (12 companies). There are therefore a similar number of building based production companies in both companies. This includes the Abbey Theatre, the national theatre that Scotland does not at this time have. 6.2.2 Breakdown of income in 1995 across the sector Ireland Scotland Commercial 52% 55.6% Arts Council 30% 25% Local Authority 2% 18.7% 69 FAS/other 6.2.3 16% 1.4% Training agency etc In 1995 the Arts Council’s drama budget was IR £5.05 (approximately £4.54m). The equivalent in Scotland in 1995 was £4.41 at that time sterling was worth more than the punt. 6.2.4 The largest 7 companies (including the Abbey) provided 355 full time equivalent jobs. The ten Scottish theatres reported 278 full time equivalent jobs in 2000. 6.2.5 62% of companies surveyed agreed that ‘Any problems with Irish Theatres are primarily caused by inadequate funding’. There was strong concern expressed about the relative funding position of Dublin and the regions. This is in marked contrast with Scotland where there is a correlation between the catchment populations of the 10 theatres and the percentage of SAC Drama funding they receive. However, had a similar research study been undertaken on the whole of the drama budget it is possible that this exact fairness would not be borne out across the board. Concerns regarding the sustainability and development of theatre in Ireland centre around: the increasing number of companies competing for funding; and the relatively low level of income whereby staff are paid below the average industrial wage level. 6.2.6 In Ireland 91% of correspondents considered that the Arts Council criteria for funding to theatre/drama are unclear and/or inadequate. 6.2.7 When asked what their priorities for funding were, the ratio of responses in favour of the various options were: 9 17% consolidation of existing companies 10 14% conditions of employment 11 14% touring of professional Irish theatre 12 6% young people/children 13 4% supporting the work of emerging new professional groups 14 3% consolidating the work of the national theatre 15 0% international touring 70 6.2.8 The Irish database of repertoire shows 522 productions originated in Ireland between 19909-94 almost half toured. 83% of work was 20th century and 46% were staged for the first time. Most respondents considered the repertoire was a strength of the sector, although there was some criticism of the emphasis on new writing. No equivalent database of repertoire exists for Scotland. 6.2.9 37% of the Irish population go to plays compared to 45% in France. This was an increase on 1981. It is the third most popular arts event after films and popular music The Scottish equivalent in 1998 was 38% ranking third after cinema, musicals/variety shows. 6.2.10 The National Theatre received 44% of the Arts Council’s total available funding and the review reports that they are extremely dissatisfied with their level of funding. Key informants’ criticisms of the national theatre focused on how they spend their money rather than on how much it is (benefits are limited to Dublin) and how little they do to nourish new talent. 6.2.11 Recommendations for changes made to the Arts Council of Ireland: 9 Clearly setting out its policy for funding, 10 Making clients more accountable for their actions- i.e. by tying funding to ‘deliverable goals’, 11 Setting up a formal client appraisal process, with active communication and feedback, 12 Introducing three year rolling plans with funding allocated on the same basis. 6.3 England 6.3.1 As highlighted at the outset of this report. For all their distinctly Scottish attributes, Scottish and English repertory theatres and their later incarnations operated under a single overall UK policy framework for 45 out of the last 50 or so years. They therefore have much in common not only from a policy perspective but also at an operational level. There is extensive integration of the Scottish and English theatre in terms of actors, directors, writers, technical and administrative staff as well as common union frameworks and contractual agreements that operate on a pan-UK level. They also compete to buy other services from a UK wide pool, such as equipment and other capital items. 6.3.2 In one sense, this review of the ten theatres is covering common ground to that explored by Peter Boyden in his report into English Regional Producing Theatres. Because of the extensive areas of overlap between the two sectors we have constructed key components of our statistical research to 71 mirror questions posed in England so as to allow comparisons to be drawn. Like for like, English Theatres are able to: 9 Support 69% more actors, 10 Support 34% more musicians, 11 Enjoy 57% more making dept jobs, 12 Draw on 66% percent more technicians, 13 Employ 44.7% more stage managers, 14 Undertake 407% more tours. 15 Enjoy aggregated production budgets that are 34% higher (£8.74m as opposed to Scotland’s £6.52m) And this comparison is made before taking into account the recent major investment by ACE. 9.25.1 However, there is also a message from a financial comparison of the two sectors. Item English Equivalent Scotland Actual % Income that is earned 68% 57% Arts Council grants 21% 25% Local Authorities 11% 18% TOTAL 100% 100% Programme Costs 48.3% 32.2% Overheads 51.7% 67.8% Table 3 Comparison of key item of income and expenditure, England v Scotland 9.25.1 Whilst superficial reading of this could be that Scottish Theatres are less commercial, more dependent on public funding, with heavier overheads, the previous work shows that in fact the Scottish Theatres are under resourced in comparison to England in all of the key areas. As such, these figures simply prove that unless one invests sufficient money to sustain the companies programme of work, a disproportionate amount of money is simply required to sustain an infrastructure that lies under-utilised for significant periods of time. In England, every £1 spent on overheads is matched by £1 for product and other activities. In Scotland for each £1 of overheads, there is just 50p for product and other activities. Given that our analysis shows that programme 72 costs are generally more than matched by box-office and other trading related income, there would be every likelihood that additional investment to release the full potential of the theatres should all better ratios of overhead to product related expenditure to be achieved. 9.25.2 In terms of boards and staffing, overall the ERPT’s comparator shows smaller boards, fewer LA representatives, more practitioners and fewer other categories than their Scottish counterparts. In terms of staffing, the ERPTs show 12% more full time posts, with a 22% lower dependence on parttime employment. 9.25.3 As can be seen from above, even before the recent major uplift in funding from ACE, the English sector was still better resourced from a number of important perspectives. With a separate funding system and indeed a devolved Parliament one might say “So What?” Well, as pointed out above the Scottish and English theatre economies are not hermetically sealed. For example, Scottish actors work throughout the English theatre sector. The English regional producing Theatre sector is almost five times the size that of the Scottish theatres under review. One of the effects of Boyden will be to increase either the quality of terms currently on offer to actors or the number of acting opportunities even further by producing more work or enhancing the current scale of productions. There is the potential therefore that the ERPTs could make Scotland less attractive to talent by either offering better terms or tying it up into longer rehearsal periods and runs. One of the correctives to this might be the impact of unions forcing higher wage settlements, but unless there are resources to absorb this, the net result will most likely be a continuation of the trends of offering fewer acting opportunities. As well as performing and creative talent there is also the issue of a brain drain of other key talent. First there is the issue of people leaving Scotland to take up better-paid employment in better equipped environments where one can focus on the task at hand rather than dealing with the constant stresses of attempting to run an organisation on fewer resources than it deserves. Second, there is the issue of people simply not choosing to enter the profession in Scotland. Theatre talent be it creative, performing or technical is highly transferable and as has been shown repeatedly in other sectors, “boom towns” often pull the brightest and best. In this scenario it is the English theatre economy in general that is the boom town in question. The issue of Boyden and the ensuing ACE funding settlement is therefore a matter of particular concern for the Scottish sector and the funding system as a whole, not simply in a copycat manner but because of the potential impact and pull the English system will exert on the sector in Scotland. In closing it is also worth noting that, as in Ireland, the needs of the buildings based producing theatre companies could only be satisfactorily assessed in the context of a sector-wide strategic review, not simply by looking at the buildings-based companies in isolation. 73 Recommendation 9: Whilst there is a strong and pressing case for a substantial increase in investment in the buildings-based companies, it is recommended that SAC should follow the Irish and English examples of any such investment being made in the context of a holistic, sector wide review of Drama strategy. 74 7. THE NATIONAL THEATRE INITIATVE 7.1 The National Theatre Initiative (NTI) is a major development in its own right. The model under consultation is still in the process of detailed financial modelling and therefore is still very much at the level of establishing basic general principles. Whilst it has the potential to add value to the work of the ten theatres it would be unwise to see it as a panacea for the problems facing the sector. Indeed the impact and reach of the National Theatre initiative is largely dependent on the health of the ten theatres as keystones of Scotland’s theatre community as its ambitions are largely defined as being additional to existing provision. There is an extensive programme of consultation and a dedicated group of theatre professionals advancing the notion of a National Theatre. Our remit is limited to looking at the potential impact such a venture might have upon the sector. 7.2 It is important to bear in mind that the ten theatres are only one element of the potential sources of productions. The NTI intends to source its material from across the full spectrum of the theatre community in Scotland. There would be wide spread anger therefore if the NTI were simply treated as core funding by other means. Similarly the volume of work proposed means that whilst a NTI production might a fill particular hole in a budget at a particular time, the fundamental problems identified in this report would still remain unaddressed. Because there are no detailed financial or operational projections available at present it is difficult to offer any substantive comments on the topic rather it might be more sensible to point out those areas which might have a negative impact on the sector so that one can at least set up a check list of potential problems that would need to be addressed from the perspectives of the ten theatres before any decision to proceed were made. 7.3 First there is the issue of artistic direction. Whilst the notion of reviving/adapting extant productions would not be open to conflict with existing artistic policies the creation of a major commissioning force within the sector does open potential for conflict. To draw an example from another sector, the desire to deliver artistic product to suit the needs of the Edinburgh International Festival has arguably led to Scottish Opera channelling its financial and artistic resources in such a way that is not necessarily beneficial to their ongoing programme. There are also practical implications of selecting material to tour. If one is to put out tours hot on the heels of a home-base performance one needs to have follow on contracts in place well in advance, with the cast etc catered for in budgets for other talent and technical staff. Also, in many instances, productions need to be made to suit touring requirements (one production manager in the sector reckoned as a rule of thumb that set/design costs are double for any given touring production as opposed to a home-base production). They also need to be stored in between their initial showing and a possible tour, possibly some time 75 in the future. The issue of new work poses the question of what happens to the work once commissioned. Is the set, etc destroyed or will it too be stored? (and if so, by whom?). 9.25.1 There are also other issues that can have a direct financial and/or operational impact on the sector. For example, even the modest proposals of four tours at medium scale represent a possible increase in competition for actors and other creative resources. If this touring pattern follows the seasonal approach adopted by Pitlochry there will be little impact. If however it is operating at the same time as the sector it will be in direct competition. As one of the theatres under review pointed out, it is one thing for the NTI to commission their company to deliver a particular project: it is another for it to bring in another company to compete for its audience at a key time. There is also the issue of inflationary/distorting pressures. The investment of £1.5m is not an inconsiderable sum in the scale of the sector and is unlikely to pass quietly without some unexpected side effects. It is likely to be the case that the NTI will be exemplary in all areas of its activities including remuneration of talent and other theatre professionals. This too can create difficulties. There is also the issue of fundraising. The view of Arts and Business is that a NTI would have to be able to compete with other national companies, but in so doing it is likely to have a significant advantage over other theatres and hence there is scope for competing for limited (rather than necessarily expanding) sponsorship for the sector. This may seem to be a litany of potential problems. As stated at the outset of this section, there are many intrinsically good reasons for developing a NTI. What we would urge however is that before fixing on a final model, SAC in partnership with the Scottish Executive should undertake a detailed cost/benefit analysis of the proposed model in relation to the existing infrastructure making provision accordingly, to ensure what has been conceived as a jewel in the Scottish theatre crown does not turn out to be yet another bone of contention and cause for concern. Recommendation 10: It is recommended that any model for the proposed National Theatre resource be subjected to detailed and independent scrutiny in the form of a cost/benefit analysis, so as to take account of potential negative operational and financial impacts that may arise for the buildings-based companies (and indeed the sector as a whole) as a result of its adoption, with appropriate mechanisms/funding being put in place to underwrite any such outcomes. 76 Overall Comparison All Six £000s Citizens £000s Dundee £000s Perth £000s 22667 20664 2157 4797 2528 1499 4145 3960 1069 -2640 1029 27153 14802 10287 0 -2064 4211 3892 3120 Pitlochry £000s Lyceum £000s Traverse £000s 4874 3685 5831 4104 3132 2619 185 1189 1727 513 4370 1786 1610 3521 1634 1562 3526 1449 605 7914 3470 2878 3611 2571 512 2801 -974 -325 -1472 -1566 -528 -995 161 55 -140 -283 161 -15 2847749 1024 447907 125 411596 238 511292 167 382786 67 757309 122 336859 305 Variable Income/Attendences SAC grant/attendences LA grant/attendences p/l/attendences £7.96 £5.20 £3.61 -£0.35 £4.82 £8.69 £6.97 £0.36 £6.14 £4.34 £3.91 £0.13 £8.11 £3.20 £3.06 -£0.27 £12.73 £3.79 £1.58 -£0.74 £7.70 £4.58 £3.80 £0.21 £9.30 £7.63 £1.52 -£0.04 Variable Income/Productions Sac grant/productions LA grant/productions p/l/productions £22,136 £14,455 £10,046 -£972 £17,256 £31,136 £24,960 £1,288 £10,622 £7,504 £6,765 £231 £24,820 £9,784 £9,353 -£838 £72,746 £21,627 £9,030 -£4,224 £47,795 £28,443 £23,590 £1,320 £10,269 £8,430 £1,679 -£49 Contribution Analysis Total Variable Income Total Variable Costs Surplus/Deficit of theatre programme Fixed Costs Total SAC Grants Total Local Authority Surplus/Deficit on overheads p/l Attendences Productions 77 94/95 95/96 96/97 97/98 98/99 99/00 Total Citizens Attendences 113991 105907 67162 52140 66981 41726 447907 Productions 30 27 11 15 26 16 125 Performances 455 485 270 261 320 273 0 Attend Indexed 100 92.91% 58.92% 45.74% 58.76% Prod Indexed 100 90.00% 36.67% 50.00% 86.67% Perf Indexed 100 106.59% 59.34% 57.36% 70.33% 70596 69400 67839 72790 79633 51338 411596 p/t Dundee Attendences Productions Performances 42 36 32 49 42 37 238 294 278 277 277 287 240 1653 Attend Indexed 10000.00% 98.31% 96.09% 103.11% 112.80% Prod Indexed 10000.00% 116.67% 76.19% 85.71% 100.00% Perf Indexed 10000.00% 105.76% 94.22% 94.22% 97.62% Attendences 83248 86931 87580 79114 74831 99588 511292 Productions 26 26 17 26 36 36 167 284 297 252 262 263 343 0 Attend Indexed 10000.00% 104.42% 105.20% 95.03% 89.89% Prod Indexed 10000.00% 100.00% 152.94% 100.00% 72.22% Perf Indexed 10000.00% 95.62% 112.70% 108.40% 107.98% Attendences 67078 66615 68860 63726 60550 55957 382786 Productions 23 16 12 6 6 4 67 190 191 206 169 188 144 1088 Attend indexed 10000.00% 99.31% 102.66% 95.00% 90.27% Prod Indexed 10000.00% 69.57% 52.17% 26.09% 26.09% Perf Indexed 10000.00% 100.53% 108.42% 88.95% 98.95% Perth Performances Pitlochry Performances p/t 76 Lyceum Attendences 155557 115977 105929 136315 122300 121231 Productions 27 20 16 17 20 22 122 372 296 305 309 298 271 1851 Attend Indexed 10000.00% 74.56% 68.10% 87.63% 78.62% Prod Indexed 10000.00% 74.07% 59.26% 62.96% 74.07% Perf Indexed 10000.00% 79.57% 81.99% 83.06% 80.11% Attendences 51356 48582 62150 48409 83414 42948 336859 Productions 47 56 57 47 48 50 305 490 488 426 380 456 375 2615 Attend Indexed 100% 94.60% 121.02% 94.26% 162.42% Prod Indexed 100% 83.93% 82.46% 100.00% 97.92% Perf Indexed 100% 100.41% 115.02% 128.95% 107.46% 412788 2847749 Performances 757309 Traverse Performances ALL SIX Total Attendances Indexed Total Productions Indexed Total Performance Indexed 541826 493412 459520 452494 487709 100.00% 91.06% 84.81% 83.51% 90.01% 195 181 145 160 178 100.00% 92.82% 74.36% 82.05% 91.28% 2085 2035 1736 1658 1812 10000.00% 97.60% 83.26% 79.52% 86.91% p/t 165 1024 1646 7207 p/t p/t 77 94/95 95/96 96/97 97/98 98/99 99/00 Total Contribution Analysis Citizens Box Office 382000 358000 297854 158643 227221 151900 1575618 30000 45000 26000 19288 27345 26853 174486 Other Earned Income 0 46000 48000 158875 87195 67588 407658 Total Variable Income 412000 449000 371854 336806 341761 246341 2157762 Direct Production Costs 826789 776841 741220 624437 836178 991777 4797242 -414789 -327841 -369366 -287631 -494417 -745436 -2639480 Fixed Overheads 780211 880159 634780 727173 662521 526510 4211354 SAC Revenue 610000 628000 628377 643378 672761 709830 3892346 Local Authority Grants 577000 592000 507110 429430 437130 578117 3120787 Surplus/Deficit on Fixed Income 406789 339841 500707 345635 447370 761437 2801779 -8000 12000 131341 58004 -47047 16001 162299 Attendences 113991 105907 67162 52140 66981 41726 447907 Productions 30 27 11 15 26 16 125 455 485 270 261 320 273 Variable income/Attendences £3.61 £4.24 £5.54 £6.46 £5.10 £5.90 £4.82 SAC Grant/attendences £5.35 £5.93 £9.36 £12.34 £10.04 £17.01 £8.69 Local Authority/attendences £5.06 £5.59 £7.55 £8.24 £6.53 £13.86 £6.97 -£0.07 £0.11 £1.96 £1.11 -£0.70 £0.38 £0.36 Variable income/productions £13,733 £16,630 £33,805 £22,454 £13,145 £15,396 £17,262 SAC grant/prod £20,333 £23,259 £57,125 £42,892 £25,875 £44,364 £31,139 local authority/prod £19,233 £21,926 £46,101 £28,629 £16,813 £36,132 £24,966 -£267 £444 £11,940 £3,867 -£1,810 £1,000 £1,298 Surplus on Ancillary Activities Surplus/Deficit on theatre activities Year End Result Performances p/l attendendences p/l prod 78 Dundee Box Office 278000 316000 350281 414486 421472 234639 2014878 Surplus on Ancillary Activities 67000 33000 54695 58831 54663 455 268644 Other Earned Income 13000 61000 41470 40846 41118 47956 245390 Total Variable Income 358000 410000 446446 514163 517253 283050 2528912 Programme Costs 276000 324000 321390 208092 226323 143813 1499618 0 0 0 Surplus/Deficit on theatre activities 82000 86000 125056 306071 290930 139237 1029294 Fixed Overheads 577000 803000 709296 786786 796078 698832 4370992 SAC Revenue 271000 302000 309816 274276 316776 312504 1786372 Local Authority Grants 224000 406000 283155 231191 233051 233051 1610448 Surplus/Deficit on Fixed Income -82000 -95000 -116325 -281319 -246251 -153277 -974172 0 -9000 8731 24752 44679 -14040 55122 70596 69400 67839 72790 79633 51338 411596 0 Year End Result Attendences Productions 42 36 32 49 42 37 238 294 278 277 277 287 240 1653 Variable income/Attendences £5.07 £5.91 £6.58 £7.06 £6.50 £5.51 £6.14 SAC Grant/attendences £3.84 £4.35 £4.57 £3.77 £3.98 £6.09 £4.34 Local Authority/attendences £3.17 £5.85 £4.17 £3.18 £2.93 £4.54 £3.91 p/l attendendences £0.00 -£0.13 £0.13 £0.34 £0.56 -£0.27 £0.13 Performances 0 variable income/pro £8,524 £11,389 £13,951 £10,493 £12,316 £7,650 £10,626 SAC grant/prod £6,452 £8,389 £9,682 £5,597 £7,542 £8,446 £7,506 local authority/prod £5,333 £11,278 £8,849 £4,718 £5,549 £6,299 £6,767 £0 -£250 £273 £505 £1,064 -£379 £232 p&l/ Prod 79 Perth Theatre Box Office 536000 523000 548000 602000 451308 495391 3155699 Surplus on Ancillary Activities 149000 166000 160500 127000 80720 43276 726496 Other Earned Income 26000 46000 22000 32000 71247 66554 263801 Total Variable Income 711000 735000 730500 761000 603275 605221 4145996 Programme Costs 694000 669000 671000 673000 622233 631005 3960238 17000 66000 59500 88000 -18958 -25784 185758 Fixed Overheads 617000 618000 610500 603000 523080 550177 3521757 SAC Revenue 285000 282000 284000 260852 260852 260852 1633556 LA Revenue 308000 275000 275000 230254 234254 239409 1561917 Surplus/Deficit on overheads -24000 -61000 -51500 -111894 -27974 -49916 -326284 YR END RESULT -7000 5000 8000 -23894 -46932 -75700 -140526 Attendences 83248 86931 87580 79114 74831 99588 511292 Surplus/Deficit on theatre activities Productions 26 26 17 26 36 36 167 284 297 252 262 263 343 0 Variable Income/attendences £8.54 £8.45 £8.34 £9.62 £8.06 £6.08 £8.11 SAC grant/Attendences £3.42 £3.24 £3.24 £3.30 £3.49 £2.62 £3.19 Local authority/attendences £3.70 £3.16 £3.14 £2.91 £3.13 £2.40 £3.05 -£0.08 £0.06 £0.09 -£0.30 -£0.63 -£0.76 -£0.27 variable income/prod £27,346 £28,269 £42,971 £29,269 £16,758 £16,812 £24,826 SAC grant/prod £10,962 £10,846 £16,706 £10,033 £7,246 £7,246 £9,782 local authority/prod £11,846 £10,577 £16,176 £8,856 £6,507 £6,650 £9,353 Performances p/l / attendences 80 Pitlochry Box Office 647000 627000 694000 678470 735941 717689 4100100 Surplus on ancillary activities 49000 44000 43000 27897 37791 33826 235514 Other Earned Income 79000 87000 50000 87813 98826 136329 538968 Total Variable Income 775000 758000 787000 794180 872558 887844 4874582 Programme Costs 292000 276000 823000 758577 787623 748432 3685632 Surplus/Deficit on theatre activities 483000 482000 -36000 35603 84935 139412 1188950 Fixed Overheads 813000 864000 438000 451083 484934 475185 3526202 SAC Revenue 236000 236000 272000 235737 231737 237530 1449004 77000 102000 127000 89556 119556 89556 604668 -500000 -526000 -39000 -125790 -133641 -148099 -1472530 -17000 -44000 -75000 -90187 -48706 -8687 -283580 67078 66615 68860 63726 60550 55957 382786 LA Revenue Surplus/Deficit on overheads YR END RESULT Attendences Productions Performances Variable Income/Attendenceces 23 16 12 6 6 4 67 190 191 206 169 188 144 1088 £11.55 £11.38 £11.43 £12.46 £14.41 £15.87 £12.73 SAC grant/attendences £3.52 £3.54 £3.95 £3.70 £3.83 £4.24 £3.79 LA grant/attendences £1.15 £1.53 £1.84 £1.41 £1.97 £1.60 £1.58 -£0.25 -£0.66 -£1.09 -£1.42 -£0.80 -£0.16 -£0.74 variable income/prod £33,696 £47,375 £65,583 £132,363 £145,426 £221,961 £72,755 SAC grant/prod £10,261 £14,750 £22,667 £39,290 £38,623 £59,383 £21,627 £3,348 £6,375 £10,583 £14,926 £19,926 £22,389 £9,025 -£739 -£2,750 -£6,250 -£15,031 -£8,118 -£2,172 -£4,233 p/l/ attendences local authority grant/prod p/l/ prod 81 Lyceum Box Office 705825 698587 640060 813051 947469 881129 4686121 62467 45734 111692 145582 117309 176880 659664 Other Earned Income 148880 61082 66836 58992 69618 80418 485826 Total Variable Income 917172 805403 818588 1017625 1134396 1138427 5831611 Programme Costs 672470 551271 656960 742371 763040 717996 4104108 Surplus/Deficit on theatre activities 244702 254132 161628 275254 371356 420431 1727503 Surplus on Ancillary Activities Fixed Overheads 1277609 1356232 1272171 1323856 1333095 1352025 7914988 SAC Revenue 557700 585600 578146 573144 564296 611143 3470029 LA Revenue 518600 525100 482675 481630 445786 424485 2878276 -201309 -245532 -211350 -269082 -323013 -316397 -1566683 43393 8600 -49722 6172 48343 104034 160820 155557 115977 105929 136315 122300 121231 757309 Surplus/Deficit on overheads YR END RESULT Attendences Productions 27 20 16 17 20 22 122 372 296 305 309 298 271 1851 Variable Income/Attendenceces £5.90 £6.94 £7.73 £7.47 £9.28 £9.39 £7.70 SAC grant/attendences £3.59 £5.05 £5.46 £4.20 £4.61 £5.04 £4.58 LA grant/attendences £3.33 £4.53 £4.56 £3.53 £3.65 £3.50 £3.80 p/l/ attendences £0.28 £0.07 -£0.47 £0.05 £0.40 £0.86 £0.21 variable income/prod £33,969 £40,270 £51,162 £59,860 £56,720 £51,747 £47,800 SAC grant/prod £20,656 £29,280 £36,134 £33,714 £28,215 £27,779 £28,443 local authority grant/prod £19,207 £26,255 £30,167 £28,331 £22,289 £19,295 £23,592 £1,607 £430 -£3,108 £363 £2,417 £4,729 £1,318 Performances p/l/ prod 82 Traverse Box Office 246000 230236 426926 229003 516246 410316 2058727 64000 64792 76637 41528 35267 59880 342104 Other Earned Income 131000 130110 118284 103599 158473 90202 731668 Total Variable Income 441000 425138 621847 374130 709986 560398 3132499 Programme Costs 339000 325183 483814 359564 550655 560973 2619189 Surplus/Deficit on theatre activities 102000 99955 138033 14566 159331 -575 513310 Fixed Overheads 602000 612451 593649 581839 644358 576750 3611047 SAC Revenue 392000 427638 422727 430628 441485 456740 2571218 LA Revenue 119000 86417 80095 70252 74330 81923 512017 Surplus/Deficit on overheads -91000 -98396 -90827 -80959 -128543 -38087 -527812 YR END RESULT 11000 1559 47206 -66393 30788 -38662 -14502 Attendences 51356 48582 62150 48409 83414 42948 336859 Productions 47 56 57 47 48 50 305 490 488 426 380 456 375 2615 Variable Income/attendences £8.59 £8.75 £10.01 £7.73 £8.51 £13.05 £9.30 SAC grant/attendences £7.63 £8.80 £6.80 £8.90 £5.29 £10.63 £7.63 LA grant/attendences £2.32 £1.78 £1.29 £1.45 £0.89 £1.91 £1.52 p/l/ attendences £0.21 £0.03 £0.76 -£1.37 £0.37 -£0.90 -£0.04 variable income/prod £9,383 £7,592 £10,910 £7,960 £14,791 £11,208 £10,270 SAC grant/prod £8,340 £7,636 £7,416 £9,162 £9,198 £9,135 £8,430 local authority grant/prod £2,532 £1,543 £1,405 £1,495 £1,549 £1,638 £1,679 £234 £28 £828 -£1,413 £641 -£773 -£48 Surplus on Ancillary Activities Performances p/l/ prod 83 8. WHAT SHOULD BE THE NATURE AND SCALE OF ANY ADDITIONAL INVESTMENT IN THE SECTOR? 8.1 Unless one simply wishes to replicate historic funding patterns, one must come up with a framework that provides benchmarks that can be applied equitably across the sector and which can be judged against a common agreed set of criteria and outcomes. In terms of categories of funding, we believe that there are three broad categories of additional investment required: 9.25.1 Reinforcing the infrastructure: this is a comprehensive, ongoing uplift into the core budget of the company in question on a revenue basis, to sustain a rounded programme of work and resource for the sector as set out in the vision. We would recommend that funding should be made on a minimum of a three-year rolling basis (noting that in England the DCMS is suggesting up to six years), with an assumption of continued support at the levels indicated, unless specifically given prior warning well in advance of any adverse decisions 9.25.2 Fostering risk/commercial acumen/releasing creativity: this is a fixed period tranche of funding which is to be used to underwrite creative/commercial risk. It is fixed term in the sense that a single sum is made available for a fixed period of say, three years. If the company uses it well it is allowed to keep any income/savings generated. If it invests unwisely, it is not penalised but it is ineligible for such support for the remainder of the period. 9.25.3 Fostering strategic relationships and collaborations: this represents specific additional funding which is targeted primarily on outcomes rather than individual companies although for ease of administration such funds might be built into individual companies’ budgets. These could be used to support the process of collective buying, etc or sharing market intelligence or to foster initiatives to fill gaps in geographic spread, as evinced by links developed by Dundee Rep in the north east, The Traverse in the Highlands and The Arches in the Borders, as well as setting up a fund to enable other parts of the country to pitch in. An individual company could also use it to support initiatives that might be of benefit to the whole sector. (For example, Pitlochry mentioned the scope for exploiting its unique operational season and resources to provide services for the rest of the sector. Similarly, Theatre Workshop could offer to take the lead in range of activities in respect of disability or other equal opportunities issues on behalf of the sector over and beyond its own core activities). Given that we live in a period of constant change, we would recommend that these funds would also be of a fixed term nature but committed over a period of say three years to permit real strategic development and to coincide with overall planning and funding cycles. 84 8.2 We do not think however that this sort of development will simply lead to more cries of schemification. If one is able to deliver a significant uplift in core funds that will enable the companies to get on and plan their work without having to seek project funds for what they see as part of their core activities, the great majority of these concerns will fall. Furthermore, there is also the concern that the schemes on offer do not sit comfortably with the practical circumstances of the buildings-based companies. Our proposals do just that and therefore should keep the benefits of competition whilst making it clear to the companies that it is a fair competition. 8.3 When asked what the scale of the additional funding requirement might be, the established theatres mentioned the need for funding uplifts somewhere in the order of 25-30%, although newer and smaller companies pointed out that a simple pro-rata increase could not enable them to fulfil the shared vision in any meaningful way. Others pointed out that if one were to look at the Boyden settlement on a “Goschen” formula basis, one would have been looking at some extra £2.5m being available to the sector. We do not believe however that a simple percentage-based uplift is the most appropriate way ahead. Similarly, whilst it may indeed prove to be the case that the total additional funding requirement is something of the order of that mentioned above, we strongly reaffirm the principle that funding decisions must ultimately be made on an individual assessment of each company. In the event that SAC wishes to explore this matter further, we have asked each of the companies to provide us with indicative costs as to what they perceive to be their funding requirements upon which they could begin to deliver the sort of vision set out in this report. This will be forwarded to SAC in due course. As pointed out earlier, whilst it is possible to suggest indicative sums to match the scale of the problem, without knowledge of the potential impacts on the rest of the sector, it is difficult to predict precisely how effective or appropriate such sums would be. 85 9. BENCHMARKING 9.1 The Digest of Statistics is a valuable compilation of a wide range of information relating to the ten theatres in the review over the six year period from 1994 - 2000. It is a key recommendation that in future SAC should ensure that work is done to update it, refine its contents and expand its range to include all SAC-supported theatre work. Maintained in this way it will be a tool for the theatres themselves, their umbrella bodies and for SAC in its assessment and planning work. 9.2 In analysing the findings and proposing future benchmarks, it is important to ensure that conclusions are based on equitable comparisons of like for like. Unfortunately it is not possible to draw trends and conclusions based on all ten because the Arches and Theatre Workshop were not assessed by the Drama Committee during the period and information has not been gathered from them in the same format as the other eight. The Byre was closed for four of the six years and the Tron was closed for two of the six years. 9.3 This analysis therefore divides the ten theatres into a group of six for whom consistent data exists (Citizens, Dundee, Perth, Pitlochry, Lyceum and Traverse) and a group of four for whom trends cannot be captured (Arches, Theatre Workshop, Tron and Byre). The Digest of Statistics contains information about both groups but the following analysis only relates to the group of six (referred to as the control group). Of the group of six, Dundee and the Citizens were both dark for three months of 99/00 and Pitlochry for six months. 9.4 In order to bring out common strands it was assumed that the theatres all receive income from three sources: 9 Income earned through operating theatrical activities (box office and ancillary trading surpluses) 10 Fixed income in the form of SAC grants 11 Fixed income in the form of local authority grants 9.5 For the purposes of analysis their expenditure is divided into two categories 9 The variable costs of putting on productions 86 10 The fixed costs of the overheads of the theatre that are incurred regardless of whether there are shows from any source on (full time artistic salaries, administration, building costs etc). This can also be referred to as ‘infrastructure’ 9.6 In global terms the six companies had a joint turnover of £47.77m over the six years and traded overall with an aggregated surplus of £217k. The cross company comparison indicates excellent housekeeping across the sector as a whole for the period of the review. Although some companies have incurred losses in certain years they have managed to cover their trading positions through either using reserves or making surpluses in other years. This shows a prudent attitude on the part of the companies that does great credit to them and contrasts with other sectors of the performing arts in Scotland, particularly those who have consistently been unable to live within their means. 9.25 The next stage is to use two performance indicators 9 numbers of attendances, 10 number of productions. 9.8 The benchmarks are derived by relating the ratios that exist between the two forms of expenditure and three forms of income and divide them by the two performance indicators. This gives us a framework for analysis over a six year period for the six companies individually and as a group. The tables that follow show: 9 how each of the theatres relate to the benchmarks over the whole of the six year period, 10 a year-by-year and company-by-company breakdown of the performance indicators, 11 a year-by-year and company-by-company breakdown of the financial ratios. 9.9 A number of key points emerge from this exercise as follows. The theatres as a group over the last six years had to generate surpluses from the variable costs of putting on shows in order to cover the fixed costs of running their organisations. This is established by looking at the surpluses made on box office ancillary trading and deducting the variable production costs. Across all six theatres for the full six years, this gives the result that they generated income of £22.66m at a cost of £20.66m, leaving a surplus to contribute to the fixed costs of running the theatres of £1.06m spread over the six years. The only theatre that makes a loss on productions is the Citizens Theatre, who confirmed that their local authority funding is specifically given in order to keep ticket prices low. They lost 87 £2.64m on productions but received £3.12m from their local authority, that left £480k to contribute to their fixed overheads. 9.10 We therefore have two economic models operating in the sector. Five companies make money on productions and if freed from the necessity of utilising the surpluses to pay their overheads could reinvest in new productions/revivals, risk taking, staff bonuses, reducing ticket prices etc. There are two possible reasons why they feel constrained from doing more productions. Because of the high level of Local Authority participation at Board level it is possible that the companies will not put the essential contribution to overheads at risk on productions which may or may not be financially successful. The second possible reason is that the theatres do not have the capacity to take on the additional work of putting on more productions with their existing staffing levels and other resources. 9.11 The conclusion for this group is that there is under utilised capacity indicated by the decline in the number of performances to 87% of levels five years ago. If levels of performances could be restored profitability would increase. The suggested solution would be either the creation of a central underwriting fund which theatres could use to spread the risk of additional productions and/or support for additional overheads to enable increased production capacity to be created. (It should be borne in mind however, that overheads are no immutable and should constantly be kept under review and scrutinised in respect of alternative means of provision to secure best value for money. 9.12 The Citizen’s model is a special case. The more productions they put on the more grants they need from the local authority or Scottish Arts Council. They receive the highest local authority grant of all the six. This economic model has given them some problems during the period covered by the review. They lost all of their Strathclyde Region Grant in 1996/97 and were operating on reduced funding for three years until the local authority restored levels of funding in 99/00. At that point attendees went down to 58% of previous levels and have yet to recover. It is worth noting that the Citizens economic model resembles the national companies except they have never incurred a deficit. By looking at their economic model it is logical that they have been forced to have dark periods (because it costs money to put on shows) this in turn has put off audiences by lack of continuity in programming. This tactic would not have worked for the other five theatres because they rely on their programming to balance the books on overheads. 9.13 The first issue that SAC needs to address is what kind of benchmark is the most appropriate. It could be that the Citizens is the ideal model for all to aspire towards or it could be that the best 88 starting point is the ‘all company’ benchmarks. The total overheads of the six theatres for six years was £27.15m covered as follows: SAC grants £14.80m Local authority and other grants £10.28m Contributed by productions 9.14 56% 39% £1.06m 5% It is not a new argument that if funding bodies could jointly cover the full costs of the overheads of the theatres and free them to use all of the proceeds of running the theatre to spend on productions it would create a more vital relationship between funders and theatres. The Cork Report on English Theatre amongst others advocated it. This exercise shows that to do this for the six theatres over six years would only have cost a total of £1.06m and could have given good results. For 1999/00 additional grants of £706k would have allowed all six theatres (not just the Citizens) to have their overheads covered entirely. 9.15 It is important for SAC to be aware that it only covers part of the costs of the overheads of the six theatres, enabling them to put on productions by partly paying for permanent artistic staff, administration and other fixed costs. 9.16 The Citizens Theatres follows the Cork Model very closely. The overheads were £4.21m and SAC grants totalled £3.89m. Local authority funding was used to keep ticket prices low and the model would have worked well had withdrawal SRC funding not undermined their capacity to put on productions. 9.17 In order to boost productivity in the theatres under review, SAC should give consideration to extending the funding model of the Citizens Theatre so that overheads are covered jointly by SAC and local authorities with additional local authority funding used to keep ticket prices low. This should be undertaken in the context of a negotiated relationship with the local authority integrated with agreed ticket pricing models. 9.18 The tables show that the benchmark SAC subsidy per seat occupied over the six years across all six theatres is £5.20. In itself this is not a meaningful figure although it compares favourably to other art forms such as opera, ballet and concerts. However, its value is as a framework for comparing support across the six theatres. The Citizens Theatre (£8.69) and Traverse (£7.63) audiences both receive a subsidy in excess of the benchmark All other theatres are below the benchmark, ranging 89 between £3.20 and £4.58. It is worth noting that the Citizens and Traverse are at opposite ends of the spectrum in the terms of local authority support: the Citizens get the highest of all and the Traverse the lowest. They also suffered the highest percentage decrease in local authority funding (Citizens 25% and Traverse 48%). What is important here is that SAC should be clear as to why this should be so. 9.19 The trend over the control period (6 companies for 5 years) was that SAC subsidy per seat occupied increased from £4.34 in 1994 to £5.10 in 1999. 9.25We recommend that SAC should aim to give an equitable level of subsidy per seat occupied throughout the country and variations from the benchmark should be within a strategic framework (relating to such matters such as programme policy, ticket pricing, local agreements with local authorities etc) and not due to accidents of history. Used in combination with the recommendation on grants covering overheads, SAC will have a powerful tool for understanding and shaping the future of this sector. 9.21 The Digest of Statistics shows that local authorities funding to the 8 theatres declined by 12% over the review period. For the control group of 6 companies over 5 years, the corresponding decline was 16.3%, thereafter the trend starts to reverse back upwards. Although the theatres had to suffer a sudden drop in the middle of the review period, in cash terms, the situation has now started to recover in global terms. Over the period the only theatres to see their local authority support grow were Dundee Rep and Pitlochry, all others have seen cash reductions, some temporary and some permanent. Over the five years, the Traverse lost 48%, the Citizens 25%, Perth 24% and Lyceum 14% (for the Lyceum local authority continued to decline beyond the control period). 9.22 What the review cannot get to is how much additional support goes to the theatres through the local authorities owning the buildings. The Citizens, Tron, Theatre Workshop, Lyceum and Perth are all owned by their local authorities and it is quite possible that a hidden level of subsidy is going in through this route. This is something that the local authorities under their regime of best value will eventually be able to ascertain. 9.23 All of the companies in the control group suffered a decline in the contribution ancillary trading made to their earned income. Overall the decline was 27% with variations between how badly the companies suffered. This is re-enforcing the feedback from the companies who say that they find it increasingly difficulty to maintain a competitive edge in the food and drink marketplace. 90 9.24 The importance of the benchmarks is that they give the SAC an average over a six year period for six companies. The average will not necessarily be the future norm and SAC may decide that one of the six companies is the benchmark and relate the other companies to that one. Having agreed where the ideal set of ratios lie, SAC can start to expand the framework to bring in the other four companies at appropriate levels but without the benefit of historic trends for them. However it will allow a common currency of assessment to be gauged over the next five years. It will be necessary for work to be done with the theatres to ensure that they all present financial and statistical information in a standard way and SAC may want to start collecting additional information (for example, on scale of productions related to sources of productions and how that relates to box office performance). 9.25This system will require a change in the way SAC sees itself in relation to the sector and also the way the sector sees itself. If SAC accepts that one of the ways of removing uncertainty from the system would be for SAC to change its focus of funding to maintaining the core infrastructure at a level that any ‘profits’ from box office could be kept by the companies to be re-invested in their ongoing programme of work. Provided therefore that one is able to develop a set of measures that could be applied equitably across the sector so that each theatre was getting fair treatment and that there were no historic imbalances built into the system. This does not mean to say however that SAC would be limited to funding mundane operational needs. We would still expect SAC to be fully engaged in the strategic picture and participate in a creative dialogue with regards to artistic policy with each company so as to ensure national strategic objectives and quality standards are obtained. However what would be different would be the fact that SAC was also guaranteeing the basic infrastructure. The responsibility for delivery of artistic policy and its result in terms of box office would be solely in the hands of the individual companies. This process would also assist local authorities, helping to make clear the precise reasons for SAC’s support, allow them to judge their decisions in a wider national context and account for their own investment, something that is particularly important in a culture that is significantly driven by Best Value. 9.26 It may be appropriate to set out a band of values rather than a single fixed sum to allow for regional variations and also to allow for “convergence” as the sector responds to a new single set of explicit criteria. Recommendation 11: It is recommended that SAC introduces a system of benchmarks as detailed in this report, to be applied equitably and transparently across the ten theatres and that such information as required to operate this system is updated on a systematic and routine basis. In the 91 process, SAC should also take the opportunity to review its current demands upon the theatres in respect of servicing the funding relationship, wherever possible seeking to reduce administrative and operational burdens. 92 10. CONCLUSIONS 10.1 Perhaps it might be more appropriate to call this closing reflections as we hope some very clear conclusions and recommendations have been set out during the course of this report. In essence we have charted the erosion of Scotland’s core drama infrastructure. Starting from a premise of a catastrophic audience decline (with the inference of a fundamental crisis in drama as an artform), we have since found that the crisis is not about the work of the theatres per se. Rather it is crisis concerning the Scottish theatre infrastructure, primarily in relation to public investment. 10.2 In a period of almost constant erosion of core support, the companies have achieved a significant growth in yield from their trading activities, expanded their commitment to socially desirable education and outreach programmes, increased their commitment to opening up access through touring and absorbed major real terms cuts in overheads to enable them to attempt to sustain an acceptable programme of work. Or rather what at the time of each decision seemed an acceptable programme of work. For the reality is that each company in its own way has entered a Faustian pact with regards to a series of short term compromises that has aimed at keeping the balance sheet clean but over time has culminated in a damaging cycle of retrenchment, feeding loss of opportunity, erosion of creative aspiration and impact thus feeding a further cycle retrenchment, etc. The relationship between cash and quality is a complex one. However, the impact of such a state of affairs on quality is implicit throughout this report. Whilst the injection of additional funds will not automatically guarantee success, the failure to do so will almost certainly guarantee failure to achieve the full potential of all involved, be they the writer, whose vision is constantly directed to a handful of players; the actors on stage; the directors and designers struggling to achieve their vision within minimal budgets; the technical team striving to support them and their administrative colleagues fighting to maintain the structure that supports them all. The romantic notion of the struggling artist achieving greatness through deprivation should have no place in modern thinking, particularly in respect of theatre, which utterly depends on marshalling a wide range of people and capital resources in a common endeavour. Too much time of theatre practitioners is spent on dealing with basic yet fundamental problems rather than being dedicated to creating new and exciting artistic products. By definition talent is not a common quality – it is a scarce commodity and we must ask ourselves whether we as a nation can afford to haemorrhage scarce talent and creative potential in this short-term, non-productive way. 10.3 Our research shows that it need not be this way. There is a strong inter-relation between availability of product and audiences, as demonstrated not just by our own research but through that of others 93 such as TGI and System 3. The theatres have demonstrated that there is an audience that will pay enough money to sustain the costs of the work - indeed they will pay enough that their work in putting on programmes ends up subsidising their core administration. We have arrived at a situation therefore that rather than subsidy playing a vital role in keeping theatre affordable to less well off members of society and giving companies the security to plan their work and develop their audience, -for what is, afterall, the most popular of all the performing arts, rock and popular music included – the purpose of putting on work stage has almost without exception appears to be about making good the shortfall of public subsidy, which has for whatever reason failed to keep pace with inflation over the period of the review. 10.4 The sector has through a process of attrition been cut to the bone. There is no real fat in the system , no neat little financial tricks, no ruthlessly efficient cuts that will either address the fundamental problem or deliver sufficient resources to patch over the problems on a strategic basis. 10.5 There is however a vision capable of sustaining a diverse range of companies and a strong case for support offering an extensive range of benefits that can flow from a properly resourced infrastructure, not just for the artform but for the wider community as a whole. An uplift in the core investment for the sector will be more than repaid through the trading and other developmental and socially beneficial activities of the companies. Whilst the proposed National Theatre resource has the potential to be a jewel in the crown for Scottish theatre it will not and cannot be the panacea for the engrained problems of the core theatre resource which it will itself depend upon. 10.6 We realise that the scale of investment revealed and intimated through this report is substantial and is most likely to be outwith the present resources of SAC. We also wish to re-emphasise the need for any investment to be made on individual merits but with the context of a wider drama strategy for Scotland. Furthermore, we recognise and appreciate the dynamics and evolving priorities of a devolved funding system and our new Scottish Parliament. It would however be the bitterest of ironies if the one sector that had done so much to sustain the public debate about Scotland’s future and sustained the cultural case for a devolved parliament over that long haul since1979 should in the process prove to be significantly worse off than it would have been under the old system. The National Cultural Strategy, however, can banish such fears as for the first time we have a government document that articulates a clear set of priorities and aspirations for Scotland, which the theatres are so manifestly well placed to deliver. The time is now right to cast off the shackles of the past and invest in this exciting vision for the future. 94 Scottish Cultural Enterprise 74 Victoria Crescent Road Glasgow G12 9DR www.scottishculture.co.uk 95