The gulf between the haves and have-nots of British arts institutions has been graphically illustrated after Arts Council England (ACE) unveiled the 26 successful applicants to its capital funding plan.
They included some of the most heavily subsidised performing arts companies: the Southbank Centre, which will receive £20m to refurbish three of its venues if it gets through stage two of the application; the Royal Opera House, which stands to gain £10m; and the National Theatre, whose proposed award is £17.5m.
The three institutions already receive £20m, £26.3m and £18.3m respectively a year in Arts Council funding.
The announcement came on the same day that theatre paper the Stage reported that more than 10% of the 206 companies who lost their funding in ACE's national portfolio review last March have since closed, with a further 22% saying they were at risk of closure. The cuts come into force at the end of this week.
Theatre director Max Stafford-Clark called ACE "absolute vermin", saying it had not adequately explained why funding for his company, Out of Joint, had been cut by 30%.
"I feel extremely bitter about the Arts Council," he said. "They produced an expensive pamphlet called Excellence for All in late 2010 and then instituted a policy which means excellence only for London and a few rich bastards in the country."
The capital funding programme will see £440m of lottery money distributed over three years. ACE's chief executive, Alan Davey, said the money was entirely separate from the coalition arts funding divided up in the National Portfolio Review.
"The capital programme is about refurbishment or adding things to existing buildings – it was always a different kind of money, if you like. You can't use lottery money for continuing investments – it's got to be for projects or one-off payments, so it's not a direct comparison."
Asked whether London arts organisations were over-represented, he said: "We took the view that we weren't going to try to regionally rationalise things but fund the projects that came to us. We're funding lots of good projects outside London too, such as the Richard Attenborough Centre [in Leicester, set to get £600,000] and the Norwich Writers' Centre [£3m]."
Sir Nicholas Hytner, director of the National Theatre, said the proposed £17.5m award would be 25% of what was needed to refurbish it, adding that £38.5m had already come in from trusts, individuals and the proceeds of its big hit, War Horse.
"You have to keep renewing the infrastructure," Hytner told the Guardian. "The last time we went through a tough period there was no lottery and there was a huge amount of infrastructure that was genuinely on its last legs. Look at the Royal Festival Hall. Nothing really happened to it for decades and when they were finally able to get round to its renewal it cost £111m."
He said that he hoped Thursday's announcement would encourage smaller arts organisations with dilapidated buildings to apply to a similar scheme.
Tony Hall, chief executive of the Royal Opera House, said the £10m it had bid for would "not be spent on chandeliers and red carpets but on things that make the building function properly and to full capacity in the most energy-efficient way".
However, smaller theatre groups whose funding was cut in the national portfolio review were less inclined to see the distinction between ACE's distribution of government and lottery funding.
The review saw ACE hand on a 15% cut to arts bodies after the government said ACE funding would drop from £452m to £350m over four years.
After the cuts were announced, some commentators praised ACE for rewarding fresh and innovative companies while removing the funding of those past their best, but Stafford-Clark said this was "complete tosh". He added: "Cameron said 'money should be put into films that will make money' and that's exactly what they [the Arts Council] are doing here."
He said that rather than being an arm's-length organisation, "over the last year they've become much more interventionist".
Davey denied that ACE was risk-averse: "Look at Bristol Old Vic – three years ago it was a basket case. A new [artistic director] came, Tom Morris, and with the National Theatre helping them to improve their private fundraising capability it's a great project, but a few years ago that would have been considered very risky."
He said large, well-subsidised organisations would be told they had a duty to help smaller bodies. The National Theatre has a programme which helps smaller theatre raise funds.
"I fear for the regional theatre's ability to respond to the government's – not the Arts Council's – demands that they do more fundraising in the private sector," said Hytner. "It is easier in London."
However, he said the council could not be blamed for having to implement a cut handed down by the government.
Davey said that while some of the organisations in the Stage survey had received funding through other Arts Council channels, he understood the anger of those that had not.
"It's hard for us to make that decision [not to fund] but it's even harder if you're the company, and no amount of soothing trend analysis is going to make that better for you."
Correction 30/3/12: This piece claimed that the Southbank Centre receives £26.3m a year from the Arts Council. This was the figure for the Royal Opera House; the Southbank Centre receives £20m. This has been corrected.