Need to know

 Q My company has in the past been very successful at raising funds through trusts and foundations, but our hit rate has declined sharply over the past 18 months, and we are having to cut back on new artistic projects and education work. What can we do to plug the funding gap?

A The first thing you can do is maximise the effectiveness of the funding applications you make. A good proportion of funders now accept the principle of full-cost recovery budgeting, where the true proportion of overhead costs is presented as attributable to the project. Also have in place all the policies and plans that funders might require as background information: a carbon emissions reduction plan, an equal opportunities policy and a child protection policy, for example. You don’t want to miss a funding opportunity due to lack of one of these.
The next thing to look at is diversifying your funding. Now is the time to build your individual giving if you haven’t already: the Tories are pledging to greatly increase the tax benefits for individual donors if they get in. Create a fundraising event; provide giving triggers from your website; introduce a Friends scheme; profile your database for wealthy individuals and get to know them. Also, think creatively about how you could create projects that tap into non-arts funding from local authorities – for example, the argument that the arts have great value in regeneration projects has been won. Could you access funding for arts and health, the Olympics or even the Queen’s Diamond Jubilee? And look again at Grants for the Arts – the new guidelines are much more transparent. A third tack is to reduce costs. Are you making the most of new digital infrastructures? Can you resource new activity with apprentices or volunteers? (Bear in mind that you cannot use them to replace employed staff.) The Government has pledged to create 5,000 apprenticeships in the creative industries per year, with money available through DCMS channels.
These suggestions are a combination of quick fixes and longer-term developmental solutions. No-one knows how long the financial difficulties will continue, nor how deep their consequences will be. Putting your organisation in the best possible position to attract funding from a variety of sources and reducing your overheads are the best ways you can weather this particular storm. Good luck!