Nosheen Iqbal and Eleanor Turney explain what the Spending Review will mean for the arts

 This afternoon’s highly-anticipated Spending Review announcement has reiterated that the government will maintain free entrance to museums and galleries, and confirmed that funding extensions for the Tate and British Museum will still go ahead – valued at almost £350m. Arts Council England (ACE), however, has been hit with a 29.6 % budget cut, amounting to a real-term reduction of £100m – from £450m to £350m by 2014. Local government also faces funding cuts of 7% a year, reducing cash by 28% by 2015. The double whammy of grim news is likely to hit the arts hard, as provision of cultural services is not a statutory duty for local authorities and ACE has already declared itself to be operating at its most streamlined.

Overall, the DCMS will lose almost 25% of its funding over four years. Chancellor George Osborne has ordered that 41% of this budget cut is to be shouldered by a reduction in the department’s administrative costs. The DCMS currently receives £1.6bn grant-in-aid, which will be slashed to £1.1bn by 2014/15. Osborne also declared that front-line arts services” and “specific projects” are to be cut by not more than 15%, with the remainder of the savings to come from admin costs. ACE has been told to cut 50% of its own administrative budget in order to protect front-line services.

Alan Davey, Chief Executive of ACE, said that the cuts “will inevitably have a significant impact on the cultural life of the country”. The Creative Partnerships programme for instance, administered by Creativity Culture and Education and long-rumoured to be heading for the chopping block, has been cut entirely. While Davey has “agreed to try and limit the effects on funded organisations and any cut in the first year to less than 10%”, ACE’s National Council will meet on 25 October and further announcements are expected shortly after.

Secretary of State for Culture, Olympics, Media and Sport Jeremy Hunt said: "To deal with an unprecedented financial deficit we have been forced to make some incredibly difficult decisions. But, in the current economic climate, this is a good settlement for DCMS’s sectors…by cutting bureaucracy and waste and prioritising the services valued by the public we will be able to protect our sporting and cultural core for the long term."  

The Olympics will not suffer budgetary constraints, and will receive the full £9.3bn currently ear-marked.