Arts funding – Federal budget follow-up

Well despite all of the doom and gloom, the Federal budget wasn’t as dire as we were led to believe it would be. Included in the Government’s key pledges to the Arts were:

  • $10m in new funding to the Aus Co to distribute (over five years) to artists across all artforms
  • continuation of funding to support its Contemporary Music Touring Program to the tune of $400,000/yr (bad pun!!) and;
  • $56m in support of TV and film production.

In terms of the new $10m funding, this will be used to support artists to produce new works, undertake fellowships and give additional presentations of their work to audiences around Australia. Grants of up to $80,000 will be made available for new work and up to $50,000 to support presentations. For a government with stretched resources to find an additional ten million dollars to support this kind of work is testament to the community value of the Arts in this country.

The shift in funding focus away from arts organisations towards individual artists appears to be a response to Aus Co’s 2010 Artist careers research. The research identified that for artists to create inspiring new work they need time, space and financial support. It also responds positively to the  New Models New Money paper, launched in early 2010 by the Queensland Government and the Centre for Social Impact, which highlighted the value of the arts in Australia and the importance of the individual artist to the growth and health of the sector. For funders with an interest in supporting artists the New Models New Money full discussion paper is well worth a read.

This provides a good segue to an interesting recent development in philanthropic funding of the Arts in Australia…. the new Sidney Myer Fund Arts and Humanities funding model. Full details aren’t due to be announced until later in the year, but what the Fund has revealed is that from 1 July 2011 it will give about 15 artists from around the country $80,000 per year for two years, seemingly with very few ties and binds. For a funder that has for so long supported Arts orgs via commonly used grant-making protocols, this is a huge change in direction. It’s great to see a big philanthropic taking risks and changing direction. I’m sure many artists, arts organisations and grantmakers will be watching with great interest.

Going back to Government funding of the arts in general, though, this time looking to the longer term. I mentioned in my last blog ( Arts Funding: England vs Australia ) that in April this year Harold Mitchell was tasked with leading a major review of private sector support for the Arts in Australia. The review will report on current Government arrangements for encouraging private sector support for the arts, consider potential new models for encouraging private sector support and develop policy options in the context of the long awaited National Cultural Policy. It doesn’t sound too dissimilar to the type of stuff happening in the UK that I talked about last time, where government is trying to leverage greater private support to try to take financial pressure off itself.  There’s been a broadly positive reception of their actions, and no doubt the same will be true here too.  The review is scheduled to be reported on in late October 2011.

It looks like there are some interesting times ahead!

  

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Budget 2011

So what the heck does the budget really mean for the Not for Profit (NFP) sector? Well, in short it’s all about reform.

The big exciting news is that we’ll finally get a charities commission here in Australia. The Australian Charities and Not-for-Profit Commission (ACNC) will be launched on 1 July 2012 and will receive a $53.6 million injection from the Government over the next four years. Finally there will be a one-stop-shop for charities, responsible for determining the eligibility of organisations seeking charitable status as well as the implementation of the much sought after ‘report-once use-often’ reporting framework for NFPs. The arrival of the Commission will hopefully lead to the implementation of some of the recommendations of the 2010 Productivity Commission Report into the NFP sector.  A Government Taskforce will be established in July 2011 to take responsibility for getting the ACNC ready to launch into operations by July 2012.  While the makeup of the Taskforce is currently unclear, there will be a broader public consultation process with the NFP sector and relevant government agencies.

While the launch of the Commission is positive, there have been some mixed feelings around the announced budget crackdown on tax exemptions for businesses run by Not for Profit organisations. The media has focused on the implications of the closing of this loophole for organisations like Hillsong Church which operates the Gloria Jean’s Coffee Shop franchise or the Seventh Day Adventist Church which operates cereal company, Sanitarium. The basic gist of it is that any revenue generated by NFPs from commercial activities that are not directed back to their altruistic purpose will be subject to income tax.  Seem’s fair enough?  Well, maybe but here’s a great international comparison from Bronwen Dalton arguing that the only winners in this closing of the loophole are the lawyers and accountants.

The final big piece of news from the Budget for the Not for Profit sector is the government announcement that it will introduce a statutory definition of ‘charity’ by July 2013. Basically, someone has decided that a 400 year old definition of charity is simply not good enough.  While the broad nature of the current definition has caused problems the review seems to be a reaction to Aid/Watch decision from the High Court late last year. The Government has committed to providing $2.9 million over four years to the ACNC (tough first up job) to assist with the reassessment of the charitable status of entities on the basis of the new statutory definition.

For more information check out the the media release from The Hon Bill Shorten