Does 'Arts Funding Bring in £4 for Every £1 Spent'?

I was interested to see, in a moan about the Labour party's lack of intention to reverse Conservative cuts to arts funding, this punchy statement:

But does arts funding 'bring in £4 for every £1 spent'? And just what does 'brings in' mean? The website had picked the statement up from a Local Government Association Press release, which itself referred to a report called 'Driving growth through local government investment in the arts' which referred (keep up) to a 2013 Arts Development UK Report. (Phew.) And here we find that magic number - but it certainly wasn't about what I expected.

Saying arts spending 'brings in £4 for every £1 spent' and I suspect most people would think that if you spent £1 of public money on the arts, £4 would flow in either directly from ticket sales, merchandising etc. or indirectly from extra tourism to your town/city etc. That's certainly what I assumed it meant, as did a straw poll I did on Facebook - and as, presumably the ranty person with the headline meant. But it wasn't that at all.

Arts Development UK kindly provided me with their 2013 report from which this 'statistic' was taken. What the report actually says is 'For every £1 spent by local authorities on arts service, leverage from grant aid and partnership working brings in £4.04 of additional funding.' So, when a local authority spends £1 it gets that additional money from grant aid and partnership - which is largely partnership with other authorities and with bodies like Arts Council England. In other words, £1 of local government spend brings the local authority another £4 of public money. Excellent for the local authority, but hardly supporting the argument to spend more on the arts.

To be honest, this 'statistic', which I suspect we will see used plenty more times, is wrong on just about every count. What the numbers refer to is being misrepresented (accidentally, I'm sure). And it's entirely the wrong way to argue for funding of the arts.

We should fund the arts. But not because they're a good return on financial investment - they rarely are, at least in the short term. It's very difficult to show that there are significant financial benefits. The tourists may well have come even if that £1 hadn't been spent (most come for the sights and commercial entertainment, rather than publicly funded arts). The money spent on the tickets, brochures, CDs, etc. etc. is likely to have been spent with someone else anyway. As one of my straw pollers, Richard Carter put it 'I used to assess business cases for a living. You can get them to say pretty much anything you want.'

Instead, we should fund the arts because they are important to what makes us human. You can argue about how much they need funding, and how we do that funding, and I would argue that it's a disgrace to spend so much on elite establishments like the Royal Opera House when regional arts funding is nose diving. There is also lots of money wasted on silly things. But one of the problems with the arts is that one person's silly thing is another's true artwork.

So here's the short version:
  1. Yes, keep some art spending (redistributing it with less to big London institutions) but 
  2. No, don't use misleading numbers and 
  3. No, don't argue it's a money spinner. It's not. It's more important than that.