The government’s response to the coronavirus pandemic has shone a light on gaps in departments’ knowledge of the sectors they are responsible for, according to the chair of parliament’s influential Public Accounts Committee.
Meg Hillier’s observation followed her committee’s report on the Department for Digital, Culture Media and Sport’s handling of the £1.57bn Culture Recovery Fund, set up to provide support to arts, culture and heritage organisations at risk of going bust in the pandemic lockdown.
The PAC report praised staff at DCMS for “working at speed and delivering a programme with low fraud levels”, but it noted that mistakes had been made, “particularly in relation to the fund’s accessibility”.
It said that although DCMS and its arm’s length bodies had so-far distributed around £1.2bn to some 5,000 organisations, the department “lacks a comprehensive understanding of the coverage and impact of its funding on parts of the sector which found themselves without funds”.
The report added that the department’s analysis of how the funding had been distributed was “incomplete”, and that its original worst-case scenario for the culture recovery fund – that lockdown measures would affect the arts and culture sector until March 2021 – had been exceeded.
MPs said “big questions” remained over whether the fund reached the freelancers, commercial organisations and supply-chain businesses essential to the arts sector, such as sound engineers and lighting specialists.
They also said DCMS had failed to model the cost of underwriting festival indemnity insurance, which had left organisers of festivals such as WOMAD to make difficult decisions about whether to risk their survival by going ahead this summer.
Additionally, MPs said they were concerned about DCMS and Arts Council England’s ability to manage the “significant and ongoing loan book commitments” created by the Culture Recovery Fund, which they said had a typical 20-year loan term.
Hillier acknowledged that DCMS had been clear it would not save every organisation hit by the pandemic, but she said the PAC was concerned about the impact of Covid-19 on organisations vital to the culture sector, such as sound engineers, lighting and technical support.
“The pandemic has exposed just how poorly departments across government understand the sectors that they oversee,” she said.
“The government must urgently consider support other than cash, such as insurance indemnity or parts of the sector risk as second summer of forced inactivity with all the devastating consequences to their survival.
“This is a sector famed for making the show go on, no matter what, but it has been hammered by Covid-19 – mostly unable to operate at all for most of the last 15 months. If the pandemic is allowed to steal a significant part of our creative and cultural sector it will have impoverished us indeed.”
The PAC report noted that DCMS had claimed the Culture Recovery Fund had “definitely been value for money already” on the basis that no “culturally significant” organisations that received funding and had failed. But it said DCMS was unable to explain how it would be measuring the value for money achieved by the fund.
MPs said the pandemic had given DCMS a lot of new information and understanding about the arts and culture sector that presented a “huge opportunity” for build its economic potential, both domestically and internationally.
They called on DCMS perm sec Sara Healey to set out in writing her vision of the key challenges facing the sector following her department’s Culture Recovery Fund investment; how the fund can make DCMS a better advocate for the sector; and how it will realise future cultural and economic impacts from its investment.
A DCMS spokesperson said the Culture Recovery Fund was the “biggest ever single investment into arts, culture and heritage” and had already protected tens of thousands of jobs and helped create work for almost a hundred thousand freelancers.
“We're pleased this report recognises DCMS' achievement in delivering this record investment quickly and accurately,” they said.
“More help is on the way following a £300m boost to the Culture Recovery Fund at the Budget and we continue to explore what further support, including issues around securing insurance, may be required when the culture sector is able to reopen.”
DCMS said that supply-chain businesses and commercial organisations supported by the fund included Wakefield’s Production Park, Mansfield’s Entertainment Sound Specialists, Nimax Theatres and Michael Harrison Entertainment.
It said a range of festivals had been supported, and cited Glastonbury, Hay Literary Festival, Buxton Arts Festival and Shambala.