Private investment in arts reaches record high, as global recession threatens fundraising in the cultural sector
 

The total figure for private sector investment in culture reached a record high in 2007/2008, climbing 12% (above inflation) to £686 million in the UK. However, investment from business declined, falling 7% from the previous year, according to new research published by Arts & Business, the charity dedicated to creating sustainable relationships between the private sector and the arts. Business investment now stands at £163 million and accounts for 24% of the overall contribution from the private sector, says its report.

In 2007/2008, investment from Individuals reached £382 million, a 25% increase that continues the trend of fast-paced growth that began to accelerate in 2005/2006. The amount of support from Trusts and Foundations also continued to increase, reaching £141 million, a 7% increase from last year and accounting for 21% of the total private investment in the cultural sector. According to the respondents of Arts & Business' Private Investment in Culture Survey, private investment (PI) in 2007/2008 accounted for an average of 13% of their organisation's total income. Public sector funding, including funding from the arts councils, the UK Ministries of Culture, other governmental departments, local authorities, other public subsidies and lottery funding, made up 54% of the total income of cultural organisations. The remaining 33% was raised through earned income, including ticket sales and trading. Creativity Colin Tweedy, Chief Executive of Arts & Business, described the background to the survey and the outlook for cultural organisations: "The overall figures show the remarkable achievement of the UK's arts fundraisers. But in this economic climate the challenges facing cultural organisations are immense and the cultural sector cannot remain immune in a global recession. "With a squeeze on public investment and a reduction in some private giving imminent, the key is to maintain long term relationships, so the cultural sector can weather the storm. Great creativity can grow from times of hardship."     With £477 million, London was again the largest recipient of private investment, accounting for 70% of the total amount of investment received by the cultural sector throughout the UK in 2007/2008. Of the top fifty organisations in the UK (according to private investment received), thirty were based in London, accounting for 55% of the total private investment received in the cultural sector. Decrease In 2007/2008 private investment in culture increased year-on-year by 12%, reaching an all time high of £686.7 million. As PI is nearing the £700 million mark, says the report, there are early warning signs suggesting that this will be the peak of the boom, at least for the foreseeable future. Business investment (BI) experienced a 7% decrease from 2006/2007, resulting in a total of £163.4 million. BI accounts for almost a quarter (24%) of total private investment in the UK, most of which comes from business sponsorship. However, the decrease in business investment could be misleading, if immediately attributed to the challenging economic climate. "Though this may have been a contributing factor for the decline in business investment (mainly cash sponsorship)", the report comments, "we cannot afford to ignore the biannual decline of business investment since 2002, which suggests that there is a 'natural cycle' for this".