The future of cultural funding rests in tax — but will the Treasury listen?

Parliament Live TV is not a channel that Athena generally watches with much hope of enlightenment. Last week, however, the Communications and Digital Committee of the House of Lords took evidence from Margaret Hodge on her refreshingly honest review of Arts Council England (ACE). Broadcast of the session wasn’t gripping, but how refreshing to hear a thoughtful, informed and positive discussion on the theme of culture from Westminster.

As regards ACE itself, Baroness Hodge first made clear what she thought it should be: a non-governmental body responsible for funding and offering access to excellence in the Arts. It should, furthermore, be focused on the needs of those it supports — artists — and those it serves — the public — and have its character as an arm’s-length body reaffirmed. This was, she argued, necessary to avoid creativity being ‘stifled by political whim’. Later in the hearing, she made explicit reference to the now notorious intervention by the former Culture Secretary Nadine Dorries in ACE’s last funding round.

As well as touching on the frustrations felt by many who had recently sought funding from ACE, Baroness Hodge also spoke about the need to simplify the process by which it operated. She characterised its application process as ‘box-ticking’ and pointed out that there was now an industry simply in filling out the necessary forms, some of it actually paid for by ACE itself. The organisation’s approach, moreover, was characterised as ‘instrumentalist’. ‘Rather than celebrating excellence,’ she observed of ACE, ‘it’s trying to change society. Now, we all believe art changes society; we all believe it has an absolutely crucial role to play in that… but that shouldn’t be its focus and underpinning principle.’

Other suggested reforms included staggering application rounds, longer funding cycles and a division of responsibilities within the organisation to engage with national and local institutions; and that the first scrutiny of applications should involve artists so that there was an informed response to proposals. Local Arts could be encouraged by funding of individuals and there should be more support for regional tours by larger cultural organisations — all very sensible.

On the subject of funding, two themes emerged. One was that there was an urgent need to encourage private philanthropy outside London and the South-East, which currently enjoys the lion’s share of such support. In this regard, Baroness Hodge deprecated the effects of cancel culture and the way it discourages corporations from supporting the Arts. More generally, she acknowledged that, in the present circumstance, the Government was not going to provide extra money for the Arts. Consequently, she argued — surely correctly — the most promising means of improving Arts funding is reform of the tax system; tailor tax relief correctly and it becomes a mechanism both for incentivising philanthropy and reducing the costs and overheads of cultural institutions. Athena couldn’t agree more. The problem is, will the Treasury listen?

This feature originally appeared in the April 22, 2026, issue of Country Life. Click here for more information on how to subscribe.