Budget reaction: Regional museums in crisis, music venues at risk

Sharon Heal, director of The Museums Association, said she was “pleased to see the increased investment for national museums in England, and the announcement of much-needed capital investment”.

However, she was “extremely disappointed that the urgent needs of local and regional museums and galleries have not been addressed.

“Local museums were already facing the brutal realities of redundancies, site closures, reduced public access and for some the threat of sale of collections or insolvency.

“And while we welcome measures to support the lowest-paid workers through increases to the minimum wage and national insurance contributions, we know this will put pressure on already over-stretched budgets and will mean many civic museums will be worse off after the budget.”

She added that the museum sector “desperately needs a government-led strategy for sustained investment in civic museums and in the short-term we are urging funders such as Arts Council England to take into account the extra pressures on museums in their funding agreements”.

Jenny Waldman, director of Art Fund, responding to the new government’s first budget said: “The budget falls short of addressing the urgent and long-term challenges facing the sector, particularly for civic museums.”

She also lamented the lack of action on local museums, saying that while she welcomes “the increase to core local authority spending by around 3.2%” and increased grant-in-aid funding and capital investment for national museums and galleries, the budget falls short of addressing the urgent and long-term challenges facing the sector, particularly for civic museums”.

Regional museums

Sara Wajid, co-CEO of Birmingham Museums Trust, was equally downbeat: “While we welcome the overall uplift for DCMS, this budget leaves us worse off and we are already in a dire financial situation in Birmingham.

“We look forward to discussing solutions with the treasury to protect the world-class cultural heritage for the people of the West Midlands and the nation.”

Tony Butler, executive director at Derby Museums, struck a similarly despairing tone. He said: “On first reading there doesn’t appear to be any assistance in the chancellor’s budget to address the financial crisis facing regional museums.

“Moreover, the above inflationary increase in the national minimum wage and increase in national insurance contribution will put even more pressure on already fragile museum organisations.

“I am delighted for colleagues in the large national museums, predominantly in London, who have received a commitment to increase their aid. I and my regional museum colleagues look forward to further discussions with the Treasury and Department for Digital, Culture, Media & Sport.”

Music sector

Over 350 grassroots music venues are “at immediate risk of closure” due to the removal of the 75% hospitality business rates relief in yesterday’s budget, according to the CEO of Music Venue Trust.

Mark Davyd said reducing the relief to 40% from April will “create a demand for £7m in additional premises taxes from a sector that, in 2023, returned an entire gross profit across all 830 such venues in the UK of just £2.9 million”.

He added that, with 43% of grassroots music venues in the UK making a loss in 2023, the tax increase represents a “potential loss of more than 12,000 jobs, over £250m in economic activity and the loss of over 75,000 live music events”.

Davyd’s comments come as many in the the arts and cultural sector responded to yesterday’s budget, the first from a Labour government in 14 years.

Michael Kill, CEO of the Night-Time Industries Association (NTIA), warned the increase in employers’ national insurance contributions announced from 13.8% to 15% on a reduced threshold of £5,000 “will have severe repercussions for already struggling businesses across the sector”.

Adding that the extension of business rates relief for a further two years at a reduced 40% rate “shows an acknowledgement of core businesses within nightlife”, he said the budget “lacks consideration for the broader industry… and the vital and diverse role our night-time economy plays within our communities and the UK’s culture and economy”.

UK Music chief executive Tom Kiehl, meanwhile, struck a more positive note. He said that because the music sector is made up of many small and medium enterprises, the Chancellor’s decision to increase the Employment Allowance to £10,500 [from £5,000] “will hopefully help many of these music businesses navigate some of the challenges ahead”.

He added: “Business rates continue to present a big challenge for many creative businesses, from venues, record stores and studios. The continuation of business rate relief should be welcome, yet at a reduced rate of relief of 40% will mean further interventions will be necessary to support this delicate part of our ecosystem.”

Challenges ahead

Echoing the concerns of the NTIA, Dan Conway, CEO of the Publishers Association, said: “The major headline for publishers – as with every business – will be assessing the impact of the Chancellor’s National Insurance rise, which will bring substantial additional costs in the year ahead.”

He continued saying it was “good to see the creative industries, of which the £11bn publishing sector is a cornerstone, heralded as one of our nation’s growth sectors”.

He also welcomed the government’s “commitment to record funding levels for R&D, protecting association to the Horizon programme and ensuring that the UK remains a global leader in research”.

Also positive was “the increase in core budgets for schools” and “the commitment to providing £3m to expand the Creative Careers Programme”.

Ellie Peers, general secretary of the Writers’ Guild of Great Britain (WGGB), said that “a budget focused on economic stability and protecting working people is welcome, as is the recognition of our world-leading creative industries as one of the pillars of the Government’s industrial strategy”.

Responding to Labour’s pledge to ‘make work pay’, which will see an increase in the National Minimum Wage by 6.7% from April 2025, Peers added: “It is vital that the unique needs of freelancers are addressed and that any changes to worker status do not adversely affect writers’ secondary sources of income or other benefits.”

Regional investment

The chief executive of Creative UK, Caroline Norbury, singled out “the expansion of Creative Careers, regional investment in the North East’s Crown Works studio and the continuation of vital fiscal incentive schemes” as welcome steps.

She continued: “We welcome the UK government’s commitment to publishing a comprehensive sector plan for the cultural and creative industries, as part of Phase 2 of the Spending Review; and look forward to assurances from the government that our sector will be stimulated to drive inclusive growth through a quantum of investment, alongside other high-growth areas.”

Norbury added that while the government “has already recognised the significant potential of the cultural and creative industries” it needs to “translate this recognition into strategic, meaningful action”.

Key to this, she said, is “addressing the barriers to investment faced by so many cultural and creative organisations and inspiring more people to see the value of creative education and careers”.

Meanwhile, writing on X (formerly Twitter), Clare Reddington, CEO of Watershed in Bristol, said salary increases at the arts venue due to the budget for “this year and next… is the equivalent of 76% of our annual public funding from ACE. This factors in cost of living and today’s NI rise only – not utilities etc which have also increased by over 21% since ’21.”

Local government funding

Councillor Louise Gittins, chair of the Local Government Association, said that while £1.3 billion in extra funding for the next financial year was welcome, “councils and the services they provide to their residents still face a precarious short and long-term future”.

She continued: “The government needs to give explicit clarity on whether councils will be protected from extra cost pressures from the increases to employer national insurance contributions.

“Only with greater funding certainty through multi-year settlements and more clarity on financial reform, can councils protect services, meet the needs of residents and work in partnership on the government’s priorities, from social care to housing, inclusive economic growth and tackling climate change.”

Arts Council England’s response

Darren Henley, chief executive of Arts Council England, responded: “In a challenging economic environment, we welcome the Chancellor’s commitment of urgently needed capital investment for the cultural sector. We will work closely with DCMS in the coming weeks to understand how these funds will be allocated to support cultural infrastructure around the country. 

“More broadly, we are aware that wider changes in the budget, such as the increase in employer national insurance contributions, will have significant implications for cultural organisations, and we will continue to work collaboratively with our colleagues in the sector to understand the likely impact of these measures.

“The sector we serve is made up of talented people and innovative organisations, bringing joy and inspiration to communities around the country. We will continue to make the case for their sustained investment, and to support them in finding dynamic ways to adapt in the future.”