The Scottish Government

Culture Minister Michael Russell

Creative Scotland

April 2, 2009

Presiding Officer, as members know well, the level of debate about this Government's intention to establish Creative Scotland is significant, and has been intense.

That is to be welcomed. Open dialogue about state support for the arts - not just what and why, but also how - is central to a modern, free-thinking democracy. But there is a moment when the talking has to stop - a moment when the focus switches from structures to substance. After a decade of debate I believe that - for Scotland - such a moment has come.

Scotland's artists are key contributors to the Scotland of ideas that we all should seek. They help us to frame the wider questions about what we want to be, and how we can achieve our aims. As two of our artists, Alexander Moffat and Alan Riach, have recently observed:

'All art…represents and interprets the world. It resists the numbing of the senses, it helps us to live more fully, engaged with the world and critical of it.' For me, that is just the type of creativity we should nurture and value in our country.

But there should be no doubt about this Government's continuing commitment to artists and creators of all kinds. Resources available have been increased and in our approach to structures we have made it clear that we want to secure a body that is fit for purpose and able to support, sustain, develop and underpin Scotland's creativity.

That body will be the new Creative Scotland and I am very heartened by the high quality of work that has been and is being done to establish that body by, first of all, my predecessor Linda Fabiani as well as the Transition Board led by Ewan Brown, the existing Joint Board led by Richard Holloway, the two Chief Executives of the existing organisations, Jim Tough and Ken Hay and the people who work in those organisations, whom I have met over the past couple of weeks. The wider arts and creative community is also deeply engaged.

I am particularly pleased that the Transition Board now has a Transition Director working with it, and I welcome Richard Smith to that role.

Creative Scotland will now come into being in the first half of next year, subject of course to the final decision of this Parliament. But in order for it to be much more than the sum of its parts; in order for it to be the living, dynamic, forward looking , informed and supportive organisation it must be, then it will need more than just Parliamentary approval. All those I have mentioned are needed at this time. All must be part of the process of change. We must engage their enthusiasm, learn from their experience and keep them fully informed of the bigger picture. I intend to do so.

But paramount, in the decision making process is of course, this Parliament so it is to this Parliament that I now wish to outline the final details of the cost of establishing Creative Scotland.

I am making this statement today because I recognise not just the continuing high degree of interest in this issue - an issue that was central to the difficulties the project experienced in Parliament last year - but also the need for any debate on Creative Scotland to be based not on press speculation but on well established and well researched fact.

The context in which Creative Scotland will be established is one where this Government wishes to expand access both to funding for arts and culture, and participation in arts and culture. For that reason, we increased the money available for culture in the plans for this Spending Review period by £33.6 million - a 14% increase in cash terms.

That type of support is what we want to continue but I should enter an early caveat here. In common with all other areas of Government, we may need to review our plans for 2010-11 in the light of the heavy cuts being imposed in that year by the UK Government on the Scottish block grant. I have already intimated such concern to the National Companies and the National Institutions and will continue to keep the matter closely under review.

Whatever the financial situation, of course, the establishment of Creative Scotland will require to be paid for. Such a task could never have been undertaken at zero cost. This is not just a transition for the two current bodies, Scottish Arts Council and Scottish Screen. It is actually a transformation. It means taking the best from both of the current organisations - where there is much to praise - and creating a unified organisation with skilled, confident leadership from the sector's best. In so doing we aim to create a new force which will set a national - and perhaps international - standard as a vibrant, forward-thinking organisation. A new force which is much needed in this time of rapid change and strong financial pressure. A new, fitter and leaner force for these times.

Presiding Officer, after detailed work from the two current bodies, with the Transition Board and within Government, my expectation is that the total cost of this transformation will be just over £3.3 million. I am publishing today a summary of what this figure includes, and I have also talked this morning to the relevant Trade Unions about these costs. This marks the start of a detailed period of consultation with them before presentation of figures to Parliament in the Financial Memorandum for the Public Services Reform Bill, and throughout the transformation programme.

The £3.3 million represents our rigorous present best estimate of the full costs that arise because of the transition. It is, in essence, an establishment cost for a new body and we should see it in that positive light.

Presiding Officer can I also say that the figures that we are publishing today including two footnotes about a couple of other costs which do not directly arise from transition but which should be noted.

The first is a one-off payment which may be required to the pension provider of Scottish Screen as part of pension arrangements required for Creative Scotland at some stage after vesting.

The second may arise from the expectation that Creative Scotland will not have charitable status. (and indeed would never have had even under the previous government's plans). I intend to discuss this matter directly with the Charities Regulator before a final decision takes effect.

Presiding Officer, this major transformation of our national delivery infrastructure for the arts will result in a major return on the investment I am outlining today. I expect the skilled leadership of Creative Scotland to set up lean, intelligent systems which help its staff to help Scotland's creativity in the widest sense. In funding the arts, the Government intends the money for just that - for the arts by means of supporting the artists.

Consequently whilst artists and creators will benefit from this investment I want to confirm that they will not pay for it from grants that are intended for their support and assistance.

Let me say, therefore, unequivocally that the cost of setting up Creative Scotland will not come from frontline grants to artists - either existing grants administered by the Scottish Arts Council and Scottish Screen, or new initiatives such as the extra £5 million over 2009/10 and 2010/11 for an Innovation Fund which was announced last year to support new arts and creative practice.

The Scottish Arts Council and Scottish Screen had already made provision for costs incurred to date during 2007/08 and 2008/09 on the groundwork for transformation. Those figures are included in the costs summary I am publishing today. The Government will meet the remaining transformation costs from within my portfolio budgets. That will be challenging, but it is the right thing to do.

Presiding Officer, since I took over this portfolio some six weeks ago I have met with a wide range of arts and cultural bodies and with many individuals within the sector. I have said to all of them that I do not regard it as the job of the Government, still less of a Government Minister, to define what should, or should not, receive money. I respect and understand the arms length principle.

But I believe that we need to be honest about what the principle means. It is not just a principle that stops interference in detail - it is a principle that insists upon Government playing a key role in defining the structures, setting the broad parameters, and then devolving the key day to day decision making.

In short, Presiding Officer, Government must set the overall context within which our arts and culture can thrive. And for me a successful context means four things:

§ Encouraging and sustaining artists and creators of all kinds

§ Ensuring their work is accessible to all

§ Ensuring that as many people as possible can participate in creative activities

§ Extending and increasing the wider benefits of arts and culture, including their contribution to the promotion and development of our unique national culture and its place in the wider international sphere.

Those aims will be enshrined in the legislation that sets up Creative Scotland. Their implementation will be the fruits of the national investment. I have outlined today.

Presiding Officer, this statement is not just about process. Whilst work continues to establish Creative Scotland - work that will also come to fruition when this Chamber gets an opportunity to shape that organisation through modern legislation - much good work in the arts continues.

I want to draw attention to some of that now.

Firstly members will recall that some weeks ago I made a promise to expand the Board of the transition company the first new appointment has just been made and I am very happy to welcome Broadcaster and cultural commentator Sheena McDonald to the organisation. She attended her first meeting last week. One more appointment remains to be made.

Secondly, members will know that I have a particularly strong interest in ensuring that Gaelic is at the forefront of how we present our national story. I am pleased therefore to be able to announce today that Gaelic will be an integral to the work of Creative Scotland and that funding has been agreed for the appointment of a specialist arts officer to implement the Gaelic Arts Strategy within the context of Creative Scotland. This support will be provided jointly by the Scottish Arts Council and Bòrd na Gàidhlig,

Thirdly I am very mindful that Scotland's Creative Industries sector makes a huge cultural and economic impact. It already contributes over £5 billion in turnover and supports 60,000 jobs. My predecessor brought forward an innovative Framework Agreement on support for the Creative Industries involving the key players, including Scottish Enterprise, Highlands and Islands Enterprise and COSLA.

I am pleased to be able to tell the Chamber that last Tuesday Cllr Harry McGuigan of COSLA and I jointly chaired the first meeting of a short life group to put flesh on the bones of that framework. I look forward to a new partnership in support for the creative industries, a partnership which will fully involve Creative Scotland and COSLA as lead players.

Fourthly I want to confirm today that the emerging structure of Creative Scotland - which is very much a work in progress - will continue to have a sectoral and subject focus. This issue has concerned many who are involved in all the arts and creative industries and who have been worried that experience within the organisations might be lost, and that inappropriate models might be used to replace successful support structures.

I am determined that we build on what is good, and I regard the sectoral approach as having succeeded. Certainly it needs modernised and developed and I look forward to some new thinking about how it might evolve. I have asked Ewan Brown and the Transition Board to let me have proposals for projects which can be developed using the Innovation Fund we announced last year, for example. But the basic idea of sectoral leadership is sound and will be retained.

However, there are some sectors where progress has not been made ad where there are shortfalls between ambition and policy. Two sectors in particular have given cause for concern.

In one of those - the traditional arts - we have already put in place a working group, led by David Francis, to recommend the best national arrangements to support and develop this vital area of interest. The conclusions of this group will feed into Creative Scotland and inform final decision making about the issue.

I believe the literature is another area where we are underachieving in terms of national policy. Accordingly I can announced to day that I have established a similar working group, to be led by the Literary Editor of the Herald, Rosemary Goring and which will include writers, publishers and academics. I want that group to review what we are doing and make radical recommendations about what we should do as a nation in order to support existing talent, promote new talent and encourage books made in Scotland as well as those who publish and sell them. This group will inform emerging policy within Creative Scotland.

Presiding Officer, I hope that today I have put some more flesh on the bones of Creative Scotland. Much remains to do and I once again welcome the input of all those who are joining with us in Government and with Ewan Brown and his colleagues to make the idea a reality.

Creative Scotland will happen. It is time it happened. Then we can devote our national energy and our national resource to the really important task ; the task of encouraging the artist, widening access to the art, securing participation in the arts and by so doing making our national culture deeper, richer and more connected to the world.

[1]A one-off payment to the pension provider may also be made, subject to the value of the deficit at the time of transfer of staff It is not a consequence of transition, but is shown here for completeness. If it is required, it is likely to be in the range £250,000 to £340,000, based on current estimates. Along with the requirement to meet any remaining deficit when the last active former Scottish Screen employee leaves employment with Creative Scotland, it is covered by the Scottish Government's guarantee on the fund. There will be reducing, recurring pension costs from 2013/14 associated with levelling-up payments for transferring staff and on-going additional employer pension contributions. These will be offset from recurring savings generated by the transition.

[2]Costs met by the Scottish Arts Council and Scottish Screen, amounting to £233,924 in 2007/08 and £438,137 in 2008/09.

[3]The Scottish Arts Council currently has charitable status, which will not automatically transfer to Creative Scotland. Although it will be open to the new body to apply to the Office of the Scottish Charity Regulator for charitable status on its own account, this is not guaranteed and Creative Scotland may therefore not have access to financial benefits that the SAC enjoys at present. The net impact is estimated to be around £300,000 per annum.