At the very heart of any cultural policy are the various ways in
which government supports the country’s imaginative and creative life. This
life is expressed through the production and consumption of art in all its
forms, and through other ways in which we think about who we are, in particular
by engaging with our movable and immovable cultural heritage. So we can define
the ‘core’ of a cultural policy as comprising, at the very least, arts and
heritage policy.

Looking at the arts, the current government’s arts
policy includes a tendency to be reactive rather than proactive, to be
steady-as-she-goes rather than expansionary, and tends to suppress rather than foster the arts’ role as social critic.

Although current levels of support from the Commonwealth for the arts are
by no means insignificant in per capita terms, it is becoming apparent that
they are insufficient to guarantee a sustainable arts sector, measured in
either quantitative or qualitative terms. The Government’s own reports on the
financial circumstances of performing companies and of other areas of the arts,
as well as research highlighting the meagre financial rewards to artistic
labour, indicate that the future is bleak
without more money, and that there is a lot of creative potential in the arts
that could be unlocked if only more funding were available.

It is worth
remembering that the case for supporting the arts in a free-market economy such
as ours does not have to be seen as special pleading, nor as rent-seeking by a
favoured cultural elite. On the contrary, there is ample evidence that the arts
give rise to generalised community benefits that are valued even by those who
do not consume the arts directly themselves. For example, as long ago as the
early 1980s Glenn Withers and I demonstrated that Australian taxpayers
recognised these benefits and were willing to see their taxes spent on
producing them.

I have no doubt that, although
dollar amounts may vary, a similar result would be found, were we to repeat the
survey today. Even the driest economist will concede that when markets fail, as
they do in their failure to provide the public-good benefits of the arts, a
presumptive case exists for collective action to remedy the problem, in this
case most immediately via government subsidy.

It is not only these public-good benefits of
the arts that are important in making an economic case for support. There are
also other economic and social effects that may be the focus of government
policy, including the arts’ contribution to employment creation, wealth
generation, urban revitalisation, social cohesion, and so on.

But, although the
economic case may be strong, there is a danger that it may become the only
basis on which governments intervene, conveying a sense that the health of the
arts is reflected solely in their financial performance. So, for example,
publicly-supported theatre companies, orchestras, dance ensembles, art
galleries etc. may feel that funding authorities look to economic sustainability
rather than cultural vitality, as a basis for continued funding.

In the international arena these concerns
have led to a debate about how to introduce cultural value alongside economic
value into the making of public policy towards the arts and culture. In the
United Kingdom, for example, government obsession with laying down performance
targets for cultural organisations is argued to have subverted the
organisations’ cultural purpose; the measurable economic and social benefits
that they provide have become more important to policy-making than the artistic
or cultural activity itself.

In the United
States, a recent report by the RAND Corporation on reframing the debate in
America about the benefits of the arts
discusses the wide range of economic and social benefits that the arts bring to
individuals and to communities, but calls the intrinsic value of the arts ‘the
missing link’. This report argues that the intrinsic benefits of the arts have
become marginalised in public discourse, in part because they are difficult to
measure. Both of these influential reports call for a new approach to public
policy formulation with respect to the arts and culture, one that makes
explicit the full range of value created by these activities. It is important that
this debate be carried forward here in Australia.