Rishi Sunak, the chancellor, has thrown a £1.5bn lifeline to Britain’s struggling theatres, music venues and museums, as he prepares to set out plans to avert a Covid-19 unemployment crisis.
Mr Sunak accepted the argument made by Britain’s artistic leaders that the need for social distancing for the foreseeable future could devastate the cultural life of the country.
The settlement, secured by culture secretary Oliver Dowden after weeks of detailed study of the problems facing the arts sector, includes £880m of grants for the financial year to April 2021.
The money, to be shared out between theatres, music venues, heritage sites, museums, galleries and independent cinemas, will be supplemented by £270m of repayable loans.
In addition, Mr Dowden will announce on Monday £100m of targeted support for national cultural institutions in England and £120m to restart construction work at cultural sites.
Scotland, Wales and Northern Ireland will also receive funding under the programme, which was endorsed on Sunday by leading figures from the arts world.
The directors of the Science, Natural History, British and V&A museums, as well as the National and Tate galleries, said in a joint statement: “We welcome the chancellor of the exchequer’s declaration of support for the UK cultural sector and announcement of funding for museums and galleries. HM Government has recognised its duty of care for the national collections . . . The economic impact of Covid-19 has proved particularly damaging to our finances. Emergency assistance this year will enable us both to care for the collections and secure safe, free access to our galleries. We now look forward to engaging with the comprehensive spending review to secure a longer-term financial settlement.”
Boris Johnson, the prime minister, said: “This money will help safeguard the sector for future generations, ensuring arts groups and venues across the UK can stay afloat and support their staff whilst their doors remain closed and curtains remain down.”
Pressure has been intensifying on the government to help performing arts venues, which are still unable to open but face the withdrawal of government support over the coming months.
Regional theatres, dark for months and facing the loss of revenue from the Christmas pantomime season, are among those institutions which could be saved by the package.
On Friday, the National Theatre confirmed it had made all 250 of its casual front-of-house staff redundant. Nuffield Southampton Theatres fell into administration in May. Last week the Royal Exchange Theatre in Manchester said 65 per cent of its staff were at risk of redundancy.
Museums and galleries are in a better position than performing arts venues, having been given the all-clear to open from July 4, but only to limited numbers of visitors.
The chancellor unveiled the arts package ahead of his summer statement on Wednesday, which will focus on jobs and include training initiatives for young people.
More than 350,000 people have been furloughed in the leisure and recreation industries since the pandemic began, and Mr Sunak said around 700,000 were employed in the sector overall.
Many of them are young people whom the chancellor fears are most at risk in the looming jobs crisis, which will become fully apparent when the government’s furlough scheme ends in October.
Mr Sunak will also focus help this week on the hospitality sector — a big employer of young people — which began to reopen this weekend. One option being considered is a temporary VAT cut for the sector, which cannot currently operate at full capacity.
Meanwhile, on Monday six Conservative former economic advisers joined forces to urge Mr Sunak to throw “the kitchen sink” at measures in his Wednesday statement to protect jobs as the economy reopens.
In a report for the centre-right think-tank Onward, the advisers also recommended that the chancellor should ensure he takes action to repair the damage to the public finances so that public debt is again on a declining path before the next election.
Calling for “an unprecedented skills and jobs package” in the statement, the six former advisers — Mats Persson, Adam Memon, Raoul Ruparel, Tim Pitt, Will Tanner and Neil O’Brien MP — also proposed another £30bn in additional investment to help struggling companies.
Mr Tanner, a former special adviser to Theresa May and now director of Onward, said: “The chancellor must focus his immediate attention on creating jobs. That means prioritising any tax-cutting measures at relieving pressure on employers.”
The advisers suggest the government establish an agency to help restructure companies that have borrowed tens of billions in government-backed loans, many of which are unlikely to be repaid. They said another £30bn should be earmarked to inject equity into growing firms so they can be well positioned for the future.
Mr Persson, former chief of staff for ex-chancellor Sajid Javid, thought Mr Sunak should initially not worry too much about the costs of such programmes, saying he should spend enough to “allow the kitchen sink to be thrown at the recovery”.