Ministers double down after criticism over "sneaky" arts funding change

Tuesday 22 October 2024

Ministers blasted for making a "sneaky" attempt to roll back a previous States agreement to invest 1% of the total Government budget in arts, culture and heritage have doubled down on their position – claiming that the current funding formula is "inefficient".

Their refusal came in a response to a strong challenge from Deputy Montfort Tadier, who criticised the covert attempt to "back out" of the commitment in next year's proposed budget without providing an explanation or seeking the approval of the States Assembly.

Fears abound that funding changes or cuts could plunge the sector into peril. Jersey Heritage warned earlier this year that the arm's-length organisation may have to cut some of its activities in response to uncertainties over its long-term funding.

CEO Jon Carter said in July that the organisation, which looks after all of the island's key historic sites as well as Jersey Archive, already paused archaeological work at La Cotte de St Brelade were "looking at other potential changes to inform Government decisions on what a sustainable heritage service looks like".

The Budget – which is due for debate next month – proposed that their funding is instead linked to the rate of inflation.

But with a forecast drop in inflation to under 2% in 2025, Deputy Tadier said the government's proposals would see the sector missing out on nearly half a million pounds in funding that it would otherwise have received under the current formula.

In their response to the proposition, the Council of Ministers said that the Fiscal Policy Panel – which provides independent advice to the Treasury Department – have advised a switch to an inflation-linked spend.

Ministers have "welcomed the change to inflation linkage in the Budget", the report reads, and asks Members to reject Deputy Tadier's proposition, saying: "Providing a suitable level of funding for arts, heritage and culture (AHC) remains important to this Council of Ministers.

"This is evident in the proposed Budget 2025 which, despite increasing pressures on the public purse, has increased the provision for AHC in line with inflation, allocating an additional £269,000 in 2025 compared to 2024 funding."

They also noted that since 2021, the States has also made investments in both the Opera House of £11.7 million and Elizabeth Castle of £5 million.

Pictured: Work is ongoing to refurbish the Opera House, which ministers said has to be considered as part of the funding package.

The report argued: "Linking this budget to total net revenue expenditure represents an inefficient method of allocating public funds, particularly during a period of strained Government finances."

Ministers argued this proposed change to inflation linkage was "clearly set out" in the plan, which was published 16 weeks before debate – "ample time for all aspects of the plan to be properly reviewed".

The Government is "reprioritising" their existing budgets to deliver prioritised objectives rather than "seeking new money", and funding for arts, culture and heritage should be "no different".

They said that if there was a "clearly identified need for additional funding" then that case should be made as part of the Budget debate.

"To maintain the existing formula would require at least an additional £719,000 to be found each year of the plan," they added.

"This above inflation increase will not have been subject to any justification or business case and will have not been prioritised against other spending pressures.

"The Budget is tightly balanced, and it would not be financially responsible to increase spend without compensating measures."

Ministers said the increased spend would result in increased taxes or further savings for other departments.

In a section with the grandiose title 'The Perils of Formulae', ministers argue against using percentages of expenditure to allocate government spend.

They said: "Using such a blunt tool constrains the ability of future governments and the Assembly to determine the allocation of public funds via the Budget process. It increases expenditure in future without reference to the needs of that area of spend in comparison to other demands for public spending.

"It is good practice that additional funding should be based on developed business cases which demonstrate the expected outcomes through cost benefit analysis."

The 1% formula, it continued, would prioritise spending on arts, culture and heritage "above all other areas of spend, including front line services, to meet this arbitrary commitment without considering Jersey's specific needs".

The Budget seeks to address the pressing challenges in the Health Care service through an additional allocation of £31 million, it said. Under the 1% rule this would attract a 1% AHC levy of £305,000, the equivalent cost of five nurses.

However, the response does not address Deputy Tadier's main issue: the "sneaky" attempt from ministers to "back out" of an agreed proposition.

He said that "no changes should be made to the target revenue expenditure model" unless a proposal "exclusively concerning the funding of those specific matters" is considered and approved by the States Assembly.

Deputy Tadier, who has long been an advocate for the island's arts and culture sector, previously explained that he was asking merely for no changes to be made to funding plans that were agreed several years ago – namely, a commitment made by the Government in 2019 to invest 1% of its overall expenditure in arts, culture and heritage from 2022 onwards.

That decision was agreed after a previous proposal from Deputy Tadier received overwhelming support in the States Assembly and this year meant £11.62 million went towards those funding streams.

Economic Development Minister Kirsten Morel later hailed the move as a "validation of the role of arts and culture for the future of the Island" in an Arts Strategy.

The new Budget, however, deviates from this formula and proposes a reduction of £438,600 in funding for 2025, Deputy Tadier said.

He wrote: "The method by which this Council of Ministers is seeking to back out of the 1% for CAH is not just sneaky but lacks courage and transparency. Just one short paragraph appears in the 2025 Budget report on page 48 to 'inform' us that the change is going to happen.

"There is no argument made, no proposition, no accompanying report nor business case that is made to overturn the previous States decision, just a single sentence.

"The problem with this process is that when overturning a previous States decision, the burden of proof should be with the person or group moving the rescindment to make their case. When the case is made, and after debate, and a positive vote, then – and only then – should a proposition be rescinded."

He defended his use of the word "sneaky", saying: "It is sneaky because it relies on a member or members to first pick up on the change; then it requires a member to lodge an amendment to the Budget simply in order to retain the status quo, and to force a debate. Indeed, this is what I will be forced to do if this proposition is not passed.

The proposition is due for debate on 12 November at the earliest.