The long term affordability of taxpayer funding for the Lichfield Garrick “must be considered” according to a Lichfield District Council report.
An overview and scrutiny committee meeting will hear recommendations that a strategic partnership agreement replaces the current concessionary services agreement which expires on 31st March.
Introduced in 2019, the agreement allowed the Lichfield Garrick Theatre to recover VAT in a bid to improve their financial position.
But report by Cllr Richard Cox, cabinet member for leisure, parks and waste management at Lichfield District Council said the change would be a chance to “restate the outputs sought from the Garrick theatre”.
The local authority’s current financial commitment to the venue stands at £250,000 a year.
“Although substantially less that the initial grant of £663,200 in 2012, this remains a significant cost for a discretionary service.
“Recent benchmarking indicated that Lichfield District Council’s culture and heritage spend – principally the Garrick theatre grant – was 23% higher than the average of Lichfield’s statistical neighbours.
“The budget consultation exercise conducted between October and December 2020 ranked the Garrick as one of only two areas where the majority of residents were in favour of reduced spending.
“The longer term affordability of the grant must be considered alongside the longer term management arrangements.”Cllr Richard Cox, Lichfield District Council
The local authority’s financial plan has already budgeted for funding to the Garrick to gradually drop from £250,000 a year to £75,000 by 2025.
Cllr Cox’s report said the move would save £290,000 by that point – but added that the final yearly figure would likely remain in place until the lease for the venue with the Lichfield Garrick Trust expires in January 2029.
After this date, the council would be able to either extend the lease or seek a new operator for the venue entirely.
“The £75,000 figure is considered the steady-state funding level for the trust to secure ongoing theatre operations.
“This funding profile reflects the trust’s aspiration to continue to meet more of their operating costs from income generation.
“This increased income generation has already seen the trust’s reliance on Lichfield District Council funding drop by more than £400,000 per year since it was established.
“It is also worth noting that the £300,000 commitment over the period from 2025 to 2029 is considerably less than the £1,000,000 that would be required if the current funding level was retained.”Cllr Richard Cox, Lichfield District Council
The coronavirus crisis has seen the curtain remain down at the Lichfield Garrick for much of the past year.
In August 2020, chief executive Karen Foster said she had been forced to make “very difficult and painful decisions” in order to ensure the theatre could survive the pandemic.
But there was some financial hope when a £280,000 Government grant was awarded to the city venue to help it survive the coronavirus pandemic.
Cllr Cox said uncertainty remained for smaller venues.
“Benchmarking with the Theatre’s Trust – the national advisory public body for theatres – has indicated that theatres of the size of Lichfield Garrick are unlikely to be able to operate without some local authority subsidy.
“Covid-19 has had a profound impact on the performing arts industry.
“Required to close in both the first and second national lockdowns, most theatres have effectively not traded since early March 2020.
“Without a clear exit path from Covid-19 restrictions, theatres and performing arts venues are struggling to assemble programmes for 2021.”Cllr Richard Cox, Lichfield District Council
The report will be heard at the meeting on Thursday (1st April).