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The air is heavy with rumours of an arts shakedown. Nothing to do with the fate of the Culture Secretary Tessa Jowell whose stay in office has barely scratched the creative surface. No, it is the Arts Council of England that is on the brink, awaiting one last internal reorganisation at the end of the month, and this time it’s really the last. Abolition of the Arts Council is no longer a question of whether, but when – and how soon, this government or the next. The 60th anniversary of its foundation by royal charter will fall in August, by which time every colour of the political spectrum will have accepted that the system by which public money is fed into arts has outlived its usefulness to such an extent that it constricts art and contradicts its founding purpose. The writing is on any wall you care to read. Demos, the Blairite think tank, is putting on a symposium at the end of the month around the premise that our ‘cultural system’ faces ‘a crisis of legitimacy’. Translated from wonk-speak, this means that New Labour has written off the Arts Council. The symposium will be launched, in his official capacity, by the ambitious David Lammy, minister for culture. Somewhat to the right of centre, the Policy Exchange group chaired by fomer Daily Telegraph editor Charles Moore has published a manifesto, ‘Culture Vultures’. It describes the ‘ruination’ of the Arts Council and, less radically, advocates its replacement by single-art funding centres, one for music, one for dance, and so on. Last month, the Welsh Assembly was narrowly thwarted in an attempt to take over direct funding of national arts companies; the Scots are thinking along the same lines. Nobody likes Arts Councils any more and few see them as politically independent, democratically accountable or even good for the arts. Yet amid the rising tides of disavowal, the thread of what has gone wrong is getting dangerously obscured and, unless we are careful, what comes next may be no better at all. The British method of arts funding – a system subsequently adopted by Australia, Canada and other countries – was invented by Maynard Keynes at the end of the War as a means of stimulating the latent genius of a bankrupt nation. Keynes proposed that ‘modest funds’ should be fed to the arts through a buffer organisation which should hold itself at ‘arm’s length’ from government. Its role was to nurture creativity and nag for higher levels of investment. For three decades, the formula worked brilliantly. In the 1950s, Arts Council support propelled the Royal Ballet to world fame, created the Royal Shakespeare Company and boosted kitchen-sink theatre at the Royal Court. In the 1960s, it boosted the Royal Opera to international rank and established a National Theatre. In the 1970s it fostered English National Opera and Opera North. Most companies received as much as three-quarter of their revenue in Arts Council grants. Such generosity ran, however, against the backdrop of industrial decline and, when Margaret Thatcher came to power in 1979, the system was modified into a mixed economy in which state and corporate funding were evenly balanced. This version, cloned by several European government’s (latterly by Berlusconi’s in Italy), worked reasonably well by rewarding energetic fund raising with all the usual baubles of official appreciation. The price for acquiescence to market efficiencies was an accusation from the left that the arts were funded by and for the middle-classes and had lost touch with a changing, multicultural society. A flood of Lottery money to glorious new buildings exacerbated the perception of privilege run rampant. When New Labour took power in 1997, it tied arts funding to political strings. Education and integration targets became key funding criteria. The Arts Councils of England, Scotland and Wales, newly devolved, dropped the pretence of arm’s length and became target enforcers – so much so that the forthcoming Demos pamphlet is forced to admit that arts professionals became ‘too focused on satisfying the policy demands of their funders.’ No longer nurturing the arts or fighting their cause, Arts Councils were viewed with suspicion and hostility. Gerry Robinson, the quality stripper businessman who removed cultural programming from independent television, recast the English Arts Council as a strategic overlord - only for its best advice to backfire as the RSC, ENO and South Bank stumbled into Arts Council-led disasters. Robinson's successor, Christopher Frayling, is an academic ‘populist’, an expert on spaghetti westerns and horror fiction. Artists with initiative looked elsewhere. The Shakespeare Globe was built by Sam Wanamaker mostly with American gifts and is sustained by the income from its museum and box-office. Year on year, the Globe makes a profit without receiving a penny from the public purse. Matthew Bourne’s independent ballet company draws the same intake of breath around the world as the Royal Ballet once did. Glyndebourne makes opera at a profit, as does Raymond Gubbay with an exhilarating Boheme at the Royal Albert Hall. The entrepreneurial Jill Fraser, who died last month, turned the Watermill at Newbury into a scintillating theatre with productions that run to the West End and Broadway – a success achieved all the faster for not having to spend months in committee rooms tailoring her vision to Arts Council checklists. At Southwark, the Menier Chocolate Factory theatre supports itself on the covers at its restaurant. There are many and varied ways nowadays of running an arts company that do not depend existentially on state funding. This is not to say that subsidy is unnecessary. On the contrary, it is needed more than ever to sustain standards and challenge convention. Our booming arts economy is wonderfully mixed up. Glyndebourne, for all its self-sufficiency, employs two orchestras that rely on subsidy for their year-round concerts. The West End habitually takes in shows which the National or the Donmar has developed in rehearsal for six months, a level of preparation untenable in the commercial theatre. Abolishing the Arts Council, whether by this government or the next, does not mean the end of state subsidy. National companies, like national galleries, will in future receive their grant direct from the Department of Culture, cutting out the middleman. The rest of the process ca be devolved back to local authorities who know better than London bureaucrats what their region needs. The Keynesian idea was right for its time. But in an age of economic diversity and media convergence, the Arts Council model has become irrelevant at best. At worst, it is an intolerable burden whose impending abolition will be celebrated across the arts. To be notified of the next Lebrecht article, please email mikevincent at scena dot org Visit every week to read Norman Lebrecht's latest column. [Index] 
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Visit every week to read Norman Lebrecht's latest column. 