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Arts and Culture: Economic Regeneration

Volume 742: debated on Tuesday 29 January 2013

Question for Short Debate

Asked By

To ask Her Majesty’s Government what is their policy on the future role of cultural projects and the arts in regional and economic regeneration.

My Lords, I welcome the opportunity to introduce this debate on a subject which I feel strongly about but which also has great topicality, given the cuts to arts budgets which are taking place, both nationally and in many regions and localities. These are, not surprisingly, the subject of widespread concern.

First of all, may I say what a pleasure it is that the Minister is replying to this debate? I have not previously had the chance to congratulate him publicly on his appointment but I now do so warmly. We have made common cause in the past on agricultural issues, not least in our concern for the survival of the red squirrel. Given that he will have to defend the Government’s record in the area we are discussing, I have a feeling that our former harmony might be temporarily dissonant—but I very much hope that that will, indeed, be only temporary. I am also delighted that my noble friend Lady Jones is on the Front Bench for the Opposition, as I know how much she cares about the issue being raised this evening.

I do not have any financial interests to declare but the register of interests does list that I am president of the Northumbrian Pipers’ Society, an important cultural organisation in the north-east which promotes the playing and appreciation of our own regional musical instrument. I have also for many years been a volunteer tourist guide for the great city of Newcastle upon Tyne and, perhaps most relevantly to this debate, I was also a Member of the other place representing Gateshead. The arts and culture have been hugely significant in that town’s economic regeneration but—through projects such as the “Angel of the North”, the Baltic art gallery, the Sage music complex and the award-winning Gateshead Millennium Bridge; this is not an exhaustive list—the benefits have also been felt throughout the whole of Tyneside, the north-east and the country. I feel hugely proud of Gateshead Council and the remarkable way that its members, many of whom come from a traditional industrial background, grasped early on the cultural agenda in the way that they did. I therefore take every opportunity to pay tribute to them and the way that they worked in partnership with other parts of the public and private sectors in the many projects that they pursued.

Indeed, given Gateshead’s record, it is frustrating that in the important Newcastle-Gateshead partnership of recent years, Gateshead’s achievements are often ascribed to Newcastle by those who do not come from the area. I am sure that the noble Lord, Lord Shipley, as a former leader of Newcastle City Council, will understand my frustration, while none the less recognising, as we both do, how important the Gateshead-Newcastle partnership has been in recent years, and how it has promoted economic regeneration..

The wording of the Question for Short Debate speaks of the contribution of the arts to regional and economic regeneration more generally in order to bring in the wider national and UK dimensions to the subject. Many of us believe that the arts, culture and the creative industries are a crucial part of our national economy, and it is my contention this evening, therefore, that supporting the arts and cultural projects nationally and regionally has to be a vital part of our economic growth strategy and policies for national economic recovery.

In documentation produced by the Arts Council, it is pointed out that our creative economy, as a proportion of GDP, is the largest in the world. Our cultural sector accounts for nearly 70,000 businesses and contributes £28 billion each year to the UK economy. The creative industries provide 1.5 million jobs and our arts and culture attract millions of overseas tourists, helping to promote Britain as a world hub of creative talent. However, if arts and culture are important to our economy nationally, they are also vital to our regions and localities and have played a crucial part in the economic successes of many towns and cities in recent years. Examples that come to mind include Liverpool, Birmingham, Bradford, Bristol and east London. Cultural projects and initiatives have also revitalised and reversed the decline of some of our traditional seaside resorts such as Folkestone and Margate, where the Turner Contemporary has attracted approaching half a million visitors since it opened in 2011. In the north-east, the Sage Gateshead has contributed £146 million to the north-east economy since it opened and currently supports 660 or more jobs. In 2011, the entries for the Turner Prize that were exhibited in the Baltic art gallery attracted a record number of visitors and had a positive economic effect. Overall, culture and the arts have contributed to a dramatic growth in the tourist industry in the north-east—a growth rate that has by far outperformed any other sector and brought our tourism industry right into the economic mainstream.

There is no doubt that arts and culture have made a great contribution nationally and locally in recent years. However, there is now considerable concern about the future arising from the Government’s current approach. I, like my party, am concerned that with the arts, as with the rest of the economy—as we have been discussing this afternoon—the cuts are too deep and too fast. To begin with, the Arts Council itself has had its budget cut by 30% since 2010. While I applaud the Arts Council in its work and recognise that, in implementing these reductions, it has sought to protect the artistic front line—by which we mean support for cultural projects and productions in some of the least well-off parts of our country—none the less, cuts of the order demanded now and for the future, on top of the economies already made, threaten the front line in my view. This is a view that is shared by many in the cultural sector both nationally and regionally.

My noble friend Lord Beecham had a Written Question on arts funding which was answered by the noble Viscount, Lord Younger, on 8 January, and I would like to ask the Minister some questions about it. My noble friend asked what proportion of central government funding for the arts in 2011-12 and 2012-13 was for capital funding, and what proportion was for revenue funding. The Answer surprisingly began by saying that the Government were unable to provide information on potential funding for the arts across central government because they did not hold the information centrally; it said that the information could be provided only “at disproportionate cost”. This begs the question: if central government spending plans are not held centrally, where are they held? The Answer gave information about the reduction in Arts Council funding and about DCMS funding in addition to Arts Council funding. This showed that the additional funding was being reduced overall from £2.198 million to £1.025 million and that for this year, 2013, no capital funding was envisaged at all in that part of the DCMS budget. Can the Minister explain this?

The Government have claimed that philanthropic giving might help fill the funding gap. The Culture Secretary herself has expressed hopes that this might double over the coming years. However, the figures that I have seen—and I do not know whether the Minister can confirm them—which were released in 2011, show a reduction in corporate giving of 11% and a reduction in individual giving of 4%. Neither of these figures augurs well for the future. Also on this question, I refer the Minister to comments from Sir Nicholas Hytner, director of the National Theatre, who, writing in the Observer, said that,

“80% of philanthropic giving to the arts benefits London, and almost invariably private funding follows public funding”.

If Sir Nicholas is right—and he obviously speaks from great experience—then charitable giving will not fill the gap and will not, in any case, help the regions, about which I will now speak further.

If the reductions in funding at national level are causing concern then the situation is even worse at regional level. As we know, the local government spending review was debated in your Lordships’ House on 17 January. Considerable concern was expressed about the cuts that local authorities were facing overall. The cuts—the result of the squeeze in local government spending—have already been felt in the arts and culture sector, but the likely effect of current and future cuts are even worse. It is not that local authorities want to cut back spending on arts and culture or that they think that such money is unimportant, but they have their overriding responsibility to continue providing services such as social care and child protection, waste collection and all the other main areas of service which local authorities have an overriding duty to provide.

I express my sympathy with councils such as Newcastle in the current situation. I think that it really does find itself between a rock and hard place—although I note that the council is continuing to discuss ways forward with arts organisation locally. Instead of cutting Newcastle’s money further, I hope that the Government will work with the city, and with other cities in a similar situation, to ensure that arts spending is not reduced in the way that is currently proposed in the consultation that Newcastle City Council has embarked on. What I say about Newcastle also applies, surprisingly, to places like Westminster, where they are also suggesting a total cut in the arts budget.

Unfortunately, I am rapidly running out of time. I shall conclude by referring to the coalition Government’s recent mid-term review. It is both regrettable and astonishing that the creative industries and culture and the arts have played so little a part in the review. In particular, no goals seem to be set by the Government for arts and culture for the next two years. Of the five commitments that are mentioned by DCMS in the mid-term review document, not one of them mentions culture or the arts. I wonder how the Government can explain that.

It seems to me that the Government need to demonstrate through new words and deeds that the arts, culture and the creative industries are indeed an indispensable part of this country’s growth strategy and that such a growth strategy should extend to all parts of the country. Nothing less than a fundamental change of heart by the Government will do in the face of the current crisis.

My Lords, I remind noble Lords that this is a time-limited debate. When the clock reaches 10, noble Lords have had their 10 minutes.

My Lords, it is a great pleasure to follow the noble Baroness, Lady Quin. We worked together in the early days of the directly elected European Parliament in a number of areas, when she represented Tyne and Wear and I represented the great City of Liverpool. I congratulate her on securing this debate on a topic which is close to my heart.

In the European Parliament and later as a member of the delegation to the Council of Europe, I took a great interest in cultural heritage and arts issues and I have no doubt about their relevance and importance to economic regeneration. It will come as no surprise that I intend to use Liverpool as an example of what can be achieved. As a former trustee of the National Museums Liverpool, I have always been aware of the wealth and diversity of what is on offer there, from the traditional Walker Art Gallery to the very modern Tate and from the Maritime Museum to the International Slavery Museum.

Michael Heseltine’s initiative after the Toxteth riots, way back in the 1980s, the garden festival and various other events led up to 2008 when Liverpool won the bid to become European Capital of Culture. Liverpool is one of the great old industrial cities, which has had to come to terms with its past in order to transform itself and to find a new image and identity. As we saw when Glasgow was the European Capital of Culture, there can be no doubt that the effect on Liverpool and the wider north-west region has been substantial. Apart from the many jobs that were created in preparing the infrastructure, thousands of jobs have proved to be long lasting. The Museum of Liverpool project was a physical result of that year, although it was not completed by 2008. However, since it opened fully in July 2011, more than 2 million people have visited it. Those numbers are way ahead of the projection.

I believe that Liverpool’s transformation into an educational and academic centre of learning, with its four universities and other institutions, owes much to its cultural and arts heritage and the way in which that was highlighted during the Capital of Culture year. Certainly the tourist figures are well up and now the port is beginning to revive with cruise ships calling in and finding so much of interest virtually at the foot of the gangway, in terms of the city’s artistic and cultural heritage.

This year, building on that experience, Derry—Londonderry—is the first UK City of Culture and a nationwide competition has been announced to find the UK’s City of Culture for 2017. I hope that my noble friend the Minister will be able to give us more information about these two events and their impact to date on Derry.

I think that we all still share a very warm feeling about the success of last year’s Olympics and Paralympics, and indeed of the Cultural Olympiad, which, apart from anything else, led to the regeneration of Stratford and has an ongoing legacy. I was delighted to learn, as a result of participating in this debate, that the Lord Mayor of the City of London has decided to make arts and culture one of the central themes of his mayoralty and is even now publishing a report on the economic, social and cultural impact of the City’s arts and culture cluster and its effect not only on the City but on the surrounding boroughs. However, I agree with the noble Baroness, Lady Quin, that the importance of government policies must reflect not only what London has to offer but the wider nation and the regions.

Funding is of course important, and the noble Baroness has pressed my noble friend on this score. Much is being done and I hope will continue to be done—and said—to support the work going on in many of the regions. I look forward to hearing the views of other speakers in this debate and, in particular, hearing what my noble friend has to say about future government policy in the area.

My Lords, I thank the noble Baroness, Lady Quin, for initiating this debate. I also extend my welcome to the Minister in his new role and look forward very much indeed to hearing his response.

I should declare that I am a trustee of Audio Visual Arts North East and a patron or supporter of several of the cultural venues in Newcastle and Gateshead. I spent several years over the past decade helping to build up arts and cultural venues in the north-east. I did it for three main reasons. The first was to widen knowledge and participation, because a more civil, equal and inclusive society is created when learning opportunities, the performing arts, libraries and museums are available to all. There is also evidence that health and well-being can improve as a result.

Secondly, we wanted to make the north-east an attractive venue for tourism and inward investment. I pay tribute to the leadership role of Gateshead, which the noble Baroness, Lady Quin, mentioned. The Sage Gateshead and the Baltic were major contributions to changing the image of Tyneside and the north-east and increasing tourism to the area. Newcastle, of course, played its role with a number of cultural buildings and venues, which were either expanded or newly built in the past decade—for example, Seven Stories, the National Centre for Children’s Books.

Overall, the cultural provision in the north-east of England is very strong. That has an economic value through the multiplier effect. I was interested recently to see that Durham’s Lumiere festival in 2011 brought £4.3 million into the local economy against spending by the county council of £400,000.

Those three principles still stand today; nothing has changed. Of course, that list would apply to all parts of the United Kingdom, not just the north-east. Generally, it would seem that for every £1 of public money invested in a cultural venue, there will be an average return of £4 to the wider economy.

For Newcastle Gateshead this has meant a major expansion in economic benefits. There are more than 2,000 full-time equivalent jobs across the north-east run by the 10 cultural venues in Newcastle Gateshead, with 1,200 full- and part-time jobs in Newcastle Gateshead itself. There have been 3.6 million attendances at cultural venues in Newcastle Gateshead and 900,000 learning and participation opportunities. Helpfully, nearly 900 volunteers are involved in delivering support. I quote those figures because they are impressive and we should recognise the enormous achievement of arts and cultural organisations in the region and congratulate the staff and the boards of those organisations on their achievements. We do not want to lose that, which is a point that I will return to later.

Underpinning all of this is the issue of free access. That is an absolute cornerstone of a civilised society. Free access to museums, galleries and libraries provides opportunities for individuals to develop themselves, to encourage reading, seeing, listening, thinking, learning and taking part. Free access is about ensuring that we actually deliver equal opportunities. Where payment has to be required in the performing arts, schemes that help those on low incomes must continue to be promoted by the Arts Council and all receiving organisations.

The fact that spending cuts would have an effect around now is not a surprise. Several years ago, we knew in Newcastle Gateshead that we had to ensure that the large increase in capacity in the number of existing and new cultural organisations could withstand a reduction in public spending whatever the Government, and that this would inevitably need to be done whoever won the election in 2010. Of course, in the north-east, the collapse of Northern Rock and the loss of so much of its cultural funding support from its high point a few years earlier have not helped. Close working, joint marketing, better procurement and maximising charitable donations can all help even if they cannot solve the impact of all of the cuts.

I pay tribute to Arts Council England because it has managed its funding cuts thoughtfully. Rightly, it demands excellence when it allocates money and it is right to emphasise the interrelationship of libraries, museums and cultural organisations. There is a crucial role now for the Arts Council to ensure that its support is not overconcentrated in London and is distributed across England to develop greater equality of funding and thereby of access. A very small switch in the proportions of Arts Council funding between London and the rest of England could have a major impact on the viability of organisations outside London.

Account must be taken by the Arts Council of the capacity of a region to develop its philanthropic base. So many firms are headquartered in London it is little wonder that levels of sponsorship are so very much higher in London. Nevertheless, more is now being done by the Arts Council to develop the potential for private giving across England through its funding streams and I want to recognise the progress that is being made.

Councils have an enhanced role now through increasing localism. I referred earlier to health and well-being. Now that substantial funds are being redirected from the National Health Service to local councils from April for the promotion of public health through health and well-being boards, the application of that money needs a lot of thought. Well-being is about the whole person and it seems to be right that public health moneys could be used to alleviate cuts in arts, culture, libraries and learning where a benefit in terms of well-being could be the identified. I refer, for example, to neighbourhood libraries, where closure could reduce well-being.

I turn now to the pupil premium. In the north-east of England it is worth more than £100 million additional money in the year from this coming April. I raise this because more than 600,000 children participated in an event at a cultural venue in Newcastle Gateshead in 2011-12. It is reasonable to suggest that some of this growing pupil premium could be used by the schools receiving it to ensure equal opportunities for their children. Children need their horizons expanding and it cannot all be done within the boundaries of the school itself. I am unaware that there are any discussions or initiatives taking place on this matter, but given the scale of the pupil premium now and from April it needs to be.

I want to mention the importance of artist development programmes. I am impressed by the potential here and cite as an example the record of Generator—the leading music development agency in the UK set up 20 years ago with the aim of developing a more sustainable music industry in the north. It was later asked by the Arts Council to assist other fledgling agencies in policy and programme development, governance and funding. It has managed to lever in £4 for every £1 received from the Arts Council, which has enabled it to support new talent, help create 50 new businesses, assist 107 SMEs and a further 173 new SMEs, as part of its business support programme which was completed in December. Generator works with emerging bands and artists; mentoring and showcasing talent; providing key help such as PR, booking agents, sources of funding and securing media exposure. Such a comprehensive and progressive artist development programme fills a gap in the market for effective development of artists at any stage of their careers. There may be potential for replicating it.

In conclusion, we need some clear thinking given the budgetary position of cultural organisations—not just in the north east but across England. I very much hope that all of those involved in current discussions on funding for arts and cultural venues, libraries and museums will think carefully about how each can help. By this I mean councils, venues, the Arts Council, sponsors, universities, colleges, and schools—particularly those in receipt of significant sums from the pupil premium. If you close a venue, you cannot reopen it easily. The loss and the damage could be profound.

Common sense demands that everyone works just a bit harder to find a solution. I want to agree entirely with what the noble Baroness, Lady Quin, said about the need now for people to take a step back and to work out how they can move forward and protect the cultural and artistic venues and libraries which are currently under such very great pressure.

My Lords, I also begin by thanking the noble Baroness, Lady Quin, for seeking out the opportunity for this debate, which is so timely and important for us all. Married to a Northumbrian—and an adopted Northumbrian myself —I was delighted to hear of her links with the Northumbrian pipers and also to hear the noble Lord, Lord Shipley, talking more of the north-east. However, I shall start elsewhere.

A decade ago when I arrived in Yorkshire—in Wakefield—there was much feverish talk of regeneration: a new hospital, new railway stations, a new shopping centre at the heart of the city and a new art gallery. There was the usual flood of scepticism, enhanced by a strong dash of Yorkshire realism. Would any of this ever happen?

The most extreme reactions in all this were to the art gallery. Here, west Yorkshire bluntness could find its ideal target: “We need a new art gallery like a hole in the head. There is enough modern art in the sculpture park already and no one can understand that anyway”. And so it went on.

Now, 10 years on, all these regeneration projects are complete—even the work on the railway stations has begun. We are amazingly fortunate to have received all this, and in the midst of one of the deepest recessions in modern history, as we have heard this afternoon. Most amazing, however, is the Hepworth gallery. The largest new-build gallery outside London for over a century, Sir David Chipperfield’s building has received universal accolades. With a target of 175,000 visitors for the first year, we achieved over half a million, and now we are heading for 400,000 in this second year.

The Hepworth effectively has placed the moderately-sized city of Wakefield, still recovering from the death of both the woollen industry and coal mining, on the map internationally. Barbara Hepworth, a daughter of Wakefield, and Henry Moore, a son of Castleford, just seven miles up the road, have given birth to the west Yorkshire sculpture triangle. That includes the Henry Moore Institute in Leeds, and the Yorkshire Sculpture Park and the Hepworth in Wakefield. The sculpture park is a great triumph, unique in England, and also a tribute to the passion and energy of Peter Murray, its founder. The Hepworth has already hosted at least one national book launch and also the nation’s salute to the 1662 Book of Common Prayer, the 350th anniversary of which was last year.

Talk of prayer moves me on to the cathedral in Wakefield, the nave of which will re-open in a month’s time after a year cocooned in scaffolding. A £3 million regeneration project supported by the Heritage Lottery Fund will make it a flexible venue for the worship of God, for which it was built, and an equally flexible venue for other cultural purposes. The largest venue in the very heart of the city, the cathedral will bring further economic benefits to the city and region just as the Hepworth has done. Of course, it is not only about the actual place itself in the case of the museum, the gallery or the cathedral but what it brings to the rest of the city and everything else thereabouts.

Talk of cathedrals comes close to my heart, having been the Dean of Norwich for some eight years. Here I declare an interest as a member of the Cathedrals Fabric Commission for England. In so many of our cities, cathedrals are responding to the needs of a changing society. In Norwich, we embarked on providing new facilities, which have further opened up that great building more effectively to the wider community. The development there is indeed the largest single development within a medieval cathedral since the Reformation.

Twelve million people visit our cathedrals every year. In 2004, a report showed that English cathedrals alone brought £150 million into the various local economies. That would be £186 million at present-day levels. Visitor numbers have increased since then by some 50 per cent, so noble Lords can do their own calculations on today’s figures—I think that it is probably about £200 million.

The benefits do not end there, of course. Cathedral music thrives here in this country as it does nowhere else in the world. Furthermore, speak to so many of our outstanding musicians, conductors, soloists and instrumentalists and you will find that their musical education began in cathedral choirs. With the advent of girls’ choirs, that is now equally true of women.

There is one more essential by-product of arts and culture in regeneration. This time it is not about finance and economics but, instead, about the nurturing of our common humanity. One serious impact in our area of the death of the coal industry has been a loss of sense of purpose in so many communities. That undermines what I would call our corporate self-esteem. The Hepworth and similar projects have begun to repair this essential element in community life. Every one of us will know how serious the loss of self-esteem is for individuals, sometimes even to the extent of people talking their own lives. It is no less serious corporately in communities.

I have tried not to drown noble Lords too much in statistics, but even the few that I have quoted tell their own dramatic story. My message to Her Majesty’s Government is that even a minimal increase in funding for our cathedrals and their upkeep, for example, will yield a bonus proportionately way beyond what any other investment can offer in these tough times. So, too, with the arts. In Wakefield we are grateful this year for Arts Council support for the Art House, another unique institution in our city which works particularly with the less well off, and sometimes the disabled, in the area of the arts and the creative arts. Frank Matcham’s fine Theatre Royal has also received funding.

However, still all these institutions and agencies are up against it. Spending on the arts and on culture is tiny proportionately to our national spending and budgeting, but the benefits that it brings in regeneration, economic development and, as I said, in terms of corporate self-esteem exceed what any of us might expect. I ask the Minister in his response to please be both realistic and generous in supporting regeneration by this most imaginative route.

My Lords, we are all very grateful to the noble Baroness, Lady Quin, for facilitating this debate. At the very outset I should declare several interests, in that my wife, daughter, son and daughter-in-law are all involved professionally in the creative arts, mainly in the music-related sector.

I realise that this debate has been projected by other speakers, largely in the English context, as addressing cuts in arts funding in England. Ministerial responsibility in this Chamber for the arts is primarily geared to England, though responsibility for the tools which encourage economic regeneration are not fully devolved. In any case, I believe that the nations of these islands can learn one from another in such matters. I hope that our experience in Wales with regard to the role of the creative industries in regional economic regeneration may be of assistance to others.

A debate was held in the National Assembly in Cardiff last Wednesday by my party. The Motion for the debate called on the Assembly to recognise and celebrate,

“the enormous contribution that the arts and creative industries make to the economy and culture of Wales”.

In his comments, our former Minister for Culture, Alun Ffred Jones, said:

“It is worth remembering that our culture is also an industry. It employs some 30,000 people in Wales, with an economic output worth around £0.5 billion”.

However, he emphasised that,

“we do not have to and should not justify expenditure on the arts by listing economic statistics. The arts have a value in their own right. It is an activity that develops confidence and creates interesting and imaginative people—the kind of people that employers want to employ”.

I wholly concur with that sentiment. Indeed, while the global companies of the past were largely concerned with manufacturing—that still has its place—key corporations of the future will increasingly be in the fields of communication, information, entertainment, bio-medical science and technology. These require high levels of creative imagination, a feature the arts are ideally placed to nurture.

The creative industries and the arts in Wales are supported through the complementary roles of the Arts Council of Wales and the activities of the business and enterprise department of the Welsh Government. That reflects the essential link between culture and the economy. The arts nurture the imagination, which generates the flow of new ideas and new products, which lend themselves to economic application via the creative industries. These industries in Wales overwhelmingly comprise small businesses. Of the 1,800 businesses in the sector, 94% employ fewer than 10 people. They make a significant contribution to the GVA of Wales and of the UK.

Many aspects of the cultural industries have a significant economic consequence for other sectors. They are a vital ingredient for tourism, with a knock-on effect on transport, hotels and catering. Major cultural projects can bring benefit not only to the city or region in which they are held, but to a wider economy and, indeed, to the Treasury and the UK generally. There is a danger that some people believe that the significant cultural activities of these islands occur only in London. That is patently not the case. One has only to think of the huge international significance of the Edinburgh Festival or, indeed, of the Hay book festival in Wales.

Showcase Scotland opens tomorrow in Glasgow. It brings into Scotland 180 holiday operators from overseas—an excellent example of how Scotland has succeeded in using the arts to underpin its economy. This autumn, Cardiff will host the WOMEX world music exhibition, an event that previously has been held in Gateshead. WOMEX will bring some 2,700 delegates to Cardiff, mainly from overseas, together with some 400 journalists. This represents not only an immediate input into our economy, but the potential of much more if we succeed in projecting a positive message and image.

WOMEX would not be coming to Cardiff were it not for the excellent Millennium Centre, a £100 million facility which has functioned as a concert hall, an opera house and a theatre. It attracts visitors from all over the world. It is a metropolitan, more than a regional facility, but without such infrastructure, it would not be possible to sustain, support and project the activities which now occur.

One does not have to look only at such major cultural infrastructure facilities. I give an example which may interest others in the Chamber. In my home town of Caernarfon, we succeeded a decade ago in establishing the Galeri Creative Enterprise Centre, at a cost of just £7 million. We could have secured 15 of them across Wales for the cost of the Millennium Centre. Galeri is the home of some 20 creative arts enterprises, ranging from music to graphic arts, cinema to drama, websites, television and arts-related PR companies. It generates some 400 events and performances a year within Galeri itself, and many more in the surrounding communities.

Galeri employs directly 36 full-time-equivalent staff and supports more than 50 full-time-equivalent jobs in the surrounding community, contributing some £3 million a year to the local economy. Galeri raises 75% of its turnover, but it is supported by a modest £300,000 a year grant from the Welsh Arts Council. An economic impact assessment recently concluded that for every £1 of grant funding, it generates £9.65 in the local economy.

Incidentally, the William Mathias Music Centre, which is based at Galeri, bringing music tuition and experience to adults, including some with learning difficulties, itself gives work to 30 part-time self-employed music teachers, providing a basic income without which they almost certainly would not all be able to remain living in north-west Wales. That activity also spawned the William Mathias Schools Music Service, which has outgrown its home in Galeri and now provides 80 peripatetic music teachers to support music education in schools in three counties in north-west Wales. Galeri is also the venue for the quadrennial international harp competition, which attracts competitors from 20 or more countries. Without that facility, none of that would be occurring in Caernarfon. Galeri represents a private and voluntary sector partnership with the public sector. I suggest that it is a model worth emulating.

Another vehicle for bringing cultural enterprise to communities across Wales is our national Eisteddfod. We may not be able to replicate that in all parts of these islands, but it is held annually in different centres, alternating between north and south. It costs about £3 million a year to sustain and is supported by a grant of about £500,000 annually from the National Assembly—again representing a very good gearing of public to private funding, bringing creative arts to every corner of Wales and stimulating interest as a result.

One problem with creative activities which are peripatetic, as with events organised by different host communities at different times, is that there is perennially a need to reinvent the wheel. Experience is not rolled forward. There is the danger of repeating the same mistakes. To avoid that, there is the need in the cultural sector to ensure adequate post-facto evaluation, which should be planned from the outset and perhaps should be a condition of public funding to ensure that ongoing maximum benefit is attained.

The physical facility is one thing, but we also need people with vision and a proactive attitude, and a framework to enable the arts to be an economic driver, not just a hobby. For example, more artists are active in Pembrokeshire than, probably, in any other rural area in Britain, but very few of them succeed in making art their full-time, primary source of income. With a little help, many of them could do that and work full-time at their art—not just in Pembrokeshire; I am sure that that is applicable more generally. Often, a support framework can make all the difference.

Whether it is major events and activities, and facilities, such as in Cardiff; in micro-grassroots activities such as Galeri in Caernarfon; or in a peripatetic festival such as the Eisteddfod, they all need a public, private and voluntary partnership. They all stimulate economic activity in the areas massively greater than the sums of public money that they require to sustain their viability. Surely the Government should think carefully before cutting funds for such a worthwhile dimension.

This debate matters to avoid us going down a blind alley of being penny wise at the cost not only to our diversity of cultural activities but, in the long term, to the regional economies in these islands.

My Lords, I thank my noble friend Lady Quin for initiating this debate, and for the characteristically powerful way in which she set out the importance of the arts in regional regeneration. She made a compelling case, drawn from her own experiences, the themes of which have found resonance from all around this Chamber this evening.

I welcome the Minister to his role and look forward to his response. I hope that he will be able to give some reassurance that the future policy of arts in the regions will be an improvement on our experience of the coalition’s record over the first half of its term of office.

At a time when our economy is stagnating, and business leaders vent their frustration at the Government’s lack of a growth strategy, investment in regional regeneration ought to be an obvious priority. It makes sense in helping to tackle the growing disparity between rich and poor, and between those in work and the unemployed, which holds back our recovery. We know, for example, that since May 2010 the number of long-term unemployed has risen by 60% across the UK as a whole, but by 83% in Yorkshire and 123% in the north-east. Similar disparities exist for youth unemployment. Meanwhile, figures for individual and business insolvency also show disturbing patterns, with the north suffering more than the national average.

Unfortunately, the current Government do not appear to have a coherent regional strategy. They were all too quick to scrap the regional development agencies when they came to power, but the local enterprise partnerships put in their place have limited scope and have been widely criticised for failing to distribute grants and loans effectively. Incidentally, I would be interested to hear from the Minister what proportion of LEP funds have been used to support the creative industries.

The lack of a regional strategy was confirmed recently by a government-commissioned report by the noble Lord, Lord Heseltine, No Stone Unturned in Pursuit of Growth. It is a searing indictment of the Government’s lack of understanding that the impetus for growth, based on new ideas and enterprise, will be driven not from the centre but from communities, cities and regions.

These same criticisms equally apply to the Government’s arts policy. The Government give every impression that, at the time of austerity, culture is expendable. We take the opposite view. Culture is not a fluffy add-on. Culture and tourism account for 7% of the UK economy, providing more than 3.5 million jobs; with a spread throughout the UK.

We believe that this is a key part of growth strategy for our economic recovery, as well as being the lifeblood of an innovative, diverse and civilised society. The cultural sector should be at the heart of the regeneration of our towns and cities, providing new leisure activities for families, encouraging businesses to move to the area and providing new talent and enterprise.

The record of the previous Government is a testament to the development of the UK as a world leader in creative talent. I point to initiatives such as free access to national museums and galleries; investment in regional theatres; the Renaissance in the Regions programme which revitalised regional museums; and the Creative Partnerships that worked with more than 1 million children around the UK.

As we have heard today, and in the last decade a number of northern cities have used the arts to drive their renaissance. These were cities such as Liverpool, the European City of Culture, which generated £800 million for the regional economy; Bradford, where the National Media Museum created an extra 536 jobs; the Birmingham Creative City initiative, which aims to create 100,000 jobs by 2020; and the Newcastle/Gateshead collaboration, which has created 1,200 new jobs. As we have heard from the noble Lord, Lord Wigley, not only the cities but small businesses and small enterprises from around the country are being revitalised, which can help to drive culture forward.

Unfortunately, instead of building on these initiatives, under this Government investment in regional and local culture has gone into sharp reverse. They have been hit by a perfect storm of squeezed funding. As we have heard, the Arts Council budget has already been cut by 30%, resulting in 21% staff cuts and a halving of their regional sites. Numerous arts organisations around the country have been forced to scale back their activity. Meanwhile, the cuts of 33% in local authority grants are squeezing local arts projects, with the LGA reporting that by 2020 up to 90% of cultural budgets will disappear and that high-profile councils such as Newcastle were already facing a 100% cut in their arts activities.

The regional impact of these cuts has been confirmed by the Audit Commission, which has said that,

“the most deprived areas have seen substantially greater reductions in government funding as a share of revenue expenditure than councils in less deprived areas”.

Can the Minister give details of any discussions held between his department and DCLG to seek to ensure that arts provision in the most deprived areas is protected?

Then there is the issue of corporate giving, initiated by the previous Culture Secretary, Jeremy Hunt. My noble friend Lady Quin referred to this. His idea was that the shortfall would be filled by boosting philanthropy. In fact, as we have heard, the contrary is the case. Figures released in 2011 have shown that corporate giving was down by 11% and individual giving down by 4%. There is also a widespread view among arts leaders around the UK that this strategy fundamentally misunderstands how philanthropy works, and how little it is likely to benefit smaller arts organisations outside London. Perhaps the Minister could clarify the department’s current thinking on this.

Finally, as we have debated on several occasions, the policy of Michael Gove, the Education Secretary, in excluding creative subjects from the EBacc sends a longer term message about the downgrading of the arts in the Government’s growth plan. As the noble Lord, Lord Rogers, has argued:

“Our writers, artists, designers, dancers, actors and architects are the envy of the world”.

I share the passion of the noble Lords, Lord Rogers and Lord Shipley, for the importance of arts in education. However, for the future it seems that these will not be the skills and attributes that the Government expect to drive our economic recovery. If the Minister disagrees with this analysis, perhaps he could explain what discussions have taken place with Michael Gove to ensure that creative skills are put back in the centre of the curriculum, where they belong.

If we are to measure the actions of the coalition so far, we can conclude that it does not see investment in the arts and culture as a central plank of regional regeneration. There has been little leadership on the issue from Ministers, little investment in new regional and local arts initiatives and no attempt to make it a statutory obligation for local authorities to fund the arts. It is a sad indictment, and a depressing legacy for a Government who took over at a time when the UK arts were renowned as being world-leading. What will change in the future to rebuild the confidence of the arts sector in the policies of the Government? What positive symbols of change might we expect to see by 2015, and how does the Minister expect the arts to generate the funding essential for them to play their part in ensuring that regions and localities can thrive again? I look forward to hearing what the Minister has to say.

My Lords, I congratulate the noble Baroness, Lady Quin, on securing this debate. I am confident that we will continue to work on many campaigns in great friendship. I would also like to thank your Lordships for your very kind remarks.

The role of art and culture in the wider economy cannot be overstated. The Government’s priority is growth; heritage, the arts and tourism are essential for this. Perhaps I may say straight away to the noble Baroness, Lady Jones of Whitchurch, that the recent Cabinet meeting in Leeds was precisely about regeneration and growth, for these activities are a valuable asset for local and regional regeneration. Indeed, the right reverend Prelate the Bishop of Wakefield particularly mentioned regional regeneration; the recent Cabinet meeting was an indication of that. The reception tonight of the Royal West of England Academy in your Lordships’ House highlighted for me just how vibrant and important the arts are in engaging in education, which my noble friend Lord Shipley referred to, and that these academies are at the heart of their communities.

In reference to what the noble Baroness, Lady Quin, has said about Gateshead and to what my noble friend Lord Shipley said about the north-east, that part of our country is extremely fortunate to have them both as champions. It is clear that the right reverend Prelate the Bishop of Wakefield is a champion of Yorkshire and of all that is going on there, including the Yorkshire Sculpture Park, the Hepworth gallery and other developments, as well as our great cathedrals. The noble Lord, Lord Wigley, is, of course, a champion of Wales.

My noble friend Lady Hooper referred to the Cultural Olympiad. In London this was a phenomenal success. I say again to the noble Baroness, Lady Jones, that was a positive symbol of is happening in communities up and down the country. Nearly 20 million people took part in more than 1,300 performances and events at over 1,200 venues across the United Kingdom. A lasting legacy of cultural and artistic engagement and participation, and working with the public, private and voluntary sectors, is the Government’s objective.

The Government’s policy on the future role of cultural projects and the arts in regional and economic regeneration is delivered by bodies that have the expertise and the regional presence to do so. These bodies include the Arts Council England, English Heritage and the Heritage Lottery Fund. In addition, VisitBritain aims to draw international visitors to Britain, while VisitEngland encourages domestic tourism. I say to the noble Baroness, Lady Quin, that it is not realistic for there to be cuts in all other areas of the public sector and for the arts, alas, to be immune. But I am conscious of what she and other noble Lords have said. DCMS Ministers are in discussion with the Local Government Association about how local authorities are approaching the pressures on existing budgets, and I acknowledge this.

The Arts Council has a strong regional presence and in turn is working closely with local authorities on arts funding priorities. I know that many councils recognise the important role that arts and culture have in creating and retaining jobs, and stimulating growth. I am very pleased that this Government restored the shares of the National Lottery distribution fund for arts and heritage to 20% each. A lot more lottery money is available to support the arts and heritage.

The noble Baroness, Lady Quin, also referred to funding. The Arts Council is responsible for allocating £2.9 billon of public and lottery funding to arts and cultural bodies over this Parliament, and is investing in capital projects, and supporting theatre, music, visual arts, dance and libraries. I say to the noble Baroness, Lady Jones of Whitchurch, that the Arts Council is investing in a creative people and places programme over the next three years, and £37 million will be allocated to priority areas around the UK where participation in the arts is lowest.

In the area of skills and access to finance, another strand of the creative people and places programme will provide match funding for businesses interested in offering apprenticeships and internships for young people. The aim is to support 10,000 placements between now and 2015. The priority of the Government is to encourage small and medium size enterprises, and many of your Lordships referred to this, including my noble friend Lord Shipley, the noble Lord, Lord Wigley, and the noble Baroness, Lady Jones of Whitchurch. The Arts Council is helping to address problems that artistic and creative businesses can face in accessing finance by providing business development loans of between £5,000 and £25,000 to help create creative enterprises.

A number of noble Lords, including the noble Baronesses, Lady Quin and Lady Jones, and my noble friend Lord Shipley, mentioned philanthropy. The catalyst programme has already seen £30 million being given to arts and heritage organisations to encourage match funding. On top of that, the scheme will also give £55 million to arts and heritage bodies up and down the country to build up endowments. Philanthropy all too often passes unnoticed, yet it is integral to some of our finest arts and culture. We should applaud the profound generosity of those donors across the country who already contribute almost £700 million each year to our cultural sector. I will have to write to the noble Baroness, Lady Quin, about the figures on private giving, if she will forgive me tonight.

Turning to tourism, the UK’s arts and cultural sector is, of course, essential to domestic tourism, as well as to that from overseas. Our diverse and magnificent cultural opportunities are a huge draw for visitors. Between 2011 and 2015, VisitBritain aims to attract an extra 4.6 million overseas visitors and £2.3 billion in extra visitor spend. I am proud to say that the top five UK visitor attractions in 2011 were national museums sponsored by DCMS which attracted 23 million visitors. Many of these institutions take exhibitions across the country. This year, Tate Modern is bringing the Turner Prize to Derry/Londonderry as the UK City of Culture for 2013. Last week, the Government launched the competition for the next UK City of Culture, which will happen in 2017.

My noble friend Lady Hooper highlighted Liverpool. Liverpool City of Culture 2008 saw a 23% increase in visitors over four years. That is a great achievement. The noble Baronesses, Lady Quin and Lady Jones, also referred to the City of Culture in that regard. The competition presents a unique opportunity for cities across England, Wales, Scotland and Northern Ireland to galvanise their culture, heritage, creative industries and tourism offer in a way that can help the local economy and create a lasting legacy for the future.

Our heritage presents the very best of our past and plays a crucial role in the future prosperity of our towns, cities and rural areas. The Heritage Lottery Fund provides funding for visitor attractions on a national and local scale, which has led to a doubling in the regional employment that is dependent on these attractions. I shall refer to two examples: at the National Railway Museum in Shildon, 79 jobs were created and £3.6 million was contributed to the economy of the county of Durham; and the Big Pit: National Coal Museum in South Wales offers a similar story, with 82 jobs created and £2.2 million contributed to Gwent. Visitor numbers went up by 83%.

The noble Baroness, Lady Jones of Whitchurch, made a point about the EBacc. This has come up many times before. The five core subjects account for about 70% of the curriculum. That means that schools have between another 20% and 30% of the curriculum, which I am sure will include creative arts and other activities that are clearly essential. The track record of creative enterprises in this country is very strong indeed. There will be announcements on this matter, but I am confident that we will continue to champion creative activity and the arts for young people.

I conclude by renewing my particular thanks to the noble Baroness, Lady Quin, and to all noble Lords. We have had a very good opportunity to air some legitimate concerns. We clearly all need to work extremely hard and effectively to assist the creative industries, the arts and all that goes with them in these difficult times. We have all accepted in our different ways across the party divide that they are challenging economic times. I emphasise, in particular to the noble Baroness, Lady Jones, that this Government strongly support the arts and culture sector. The investments I have outlined indicate that.

It is now my privilege to work with the Minister for Sport and Tourism and the Secretary of State, who was in Leeds on Monday talking to leaders in Yorkshire about tourism and the opportunities for that important county. These are positive examples of what this Government really think about arts and culture and regional regeneration.

Arts and culture are absolutely key to the reputation of our country overseas and they also make a key contribution to everyone in this country. This is an ongoing programme of work and there is very much more to do. Governments and Oppositions can never do enough. However, it falls to the Government and a number of key strategic bodies to ensure that culture and the arts remain a key element of economic growth and social well-being.

However, I believe that it goes beyond that. The arts and culture undoubtedly raise the spirit of the British people and they are a great source of pride to our nation. I believe these are sentiments that we in your Lordships’ House all share.