The New South Wales government has been accused of creating “a Hunger Games atmosphere” among 84 arts organisations over its $50m Covid-19 arts bailout, which remains shrouded in secrecy.
Announced in May, the $50m Rescue and Restart program was to be run in two stages, with the first $25m to help organisations through the so-called “hibernation” period; the second tranche of $25m was to enable companies to restart.
In June, the application process was criticised for its lack of transparency, as organisations were left in the dark over who was eligible and how the money would be dispersed.
Guardian Australia now understands that the money has begun to be allocated, and smaller players fear that the major arts organisations are being favoured. NSW arts minister Don Harwin’s office would only confirm that recipients will be kept confidential.
Concerns that the money has been or will be funnelled exclusively to the major companies were aired on 1 July, during the NSW parliament’s public accountability committee inquiry into the state government’s management of the Covid-19 pandemic.
The reason behind the confidentiality, the minister’s office told the Guardian, was that arts organisations were concerned future streams of funding could be compromised if they publicly admitted to Covid-caused “economic strife”.
Harwin confirmed that 84 arts organisations applied for urgent financial assistance, but refused to reveal whether any of the hibernation or restart money had been allocated.
But Guardian Australia has confirmed the Sydney Theatre Company, after suffering significant losses in 2018 and 2019 that were unrelated to the Covid-19 shutdown, has been allocated a large slab of the pandemic rescue package.The STC went from a $5.8m operating profit in 2017 to a $7.75m operating loss in 2019, which is close to the sum of $7m the company is rumoured to have received from the rescue package.
The company’s executive director, Patrick McIntyre, will not confirm this figure.
“We are extremely grateful to the NSW Government for making an investment into the company as part of its Rescue and Restart so that we are able remain solvent into 2021 and we can plan our way forward,” McIntyre told the Guardian in a statement.
McIntyre said once income and expenses relating to the Walsh Bay redevelopment project were taken into account, the operating loss for 2019 was more like $2.6m.
He said the potential of further operating losses had been flagged by the auditor in the 2019 annual report, suggesting the bailout was in fact for Covid-19-related losses.
“[The auditor of the annual report] clearly states that the closure of theatres in March owing to the coronavirus pandemic resulted in a sudden loss of revenue which, if prolonged, would create uncertainty as to the organisation’s ongoing viability,” McIntyre said.
The annual report’s financials however, cover only the results up to December 2019, some three months before the lockdown began.
With the STC bailout rumour circulating among arts boards across Sydney, there are misgivings among small-to-medium companies that the NSW government has elected to watch them drown, while the major flagship companies – a few with healthy reserves to ride out the rough seas – are thrown multimillion-dollar lifelines.
The scepticism of preferential treatment was stoked by the ABC’s “arts rorts” revelations in May, when a trove of freedom of information documents revealed that Harwin and the deputy premier, John Barilaro, had funnelled all but $3m of a $47m arts funding pool into Coalition electorates in the months leading up to the 2019 state election.
“There’s palpable anger out there, this appalling and unprecedented lack of transparency,” one senior former arts administrator and current arts board member told Guardian Australia.
“But nobody wants to go public because it could cruel their own chances at getting anything from the [NSW] government under the rescue package … everyone is fearful of retribution.”
NSW Labor’s spokesman for the arts, Walt Secord, told the Guardian the lack of transparency over the fate of $50m in public money was “despicable”.
“[Harwin] is creating a Hunger Games atmosphere where arts organisations are fighting each other for scarce resources,” he said.
The public accountability committee inquiry heard in July that 11 major arts organisations based in NSW had effectively been given a head start on access to the $50m Covid-19 emergency fund.
The Sydney Theatre Company, Opera Australia, Australian Ballet, Sydney Symphony, Australian Chamber Orchestra, Sydney Dance Company, Bangarra Dance Theatre, Belvoir, Bell Shakespeare, Australian Brandenburg Orchestra and Musica Viva were all brought to the table to discuss the rescue package before it was announced, the inquiry heard.
“The concern is that the majors have a rails-run on this,” the inquiry’s chair, David Shoebridge, put to Department of Premier and Cabinet official Kate Foy.
“They are already at the table and they will get the bulk of the $50m because there has already been engagement with them and there will only be crumbs left for the rest,” Shoebridge said.
“You would have to be living under a rock not to realise there are concerns about the transparency of the allocation of grants money.”
At that hearing, Foy justified the lack of transparency as a way to protect the recipients: “This is about the financial distress of companies,” she said. “We also need to think about the financial position of those companies and be sensitive to that.”
Secord said Create NSW’s decision made in the midst of the lockdown to cease multiyear funding to bodies such as Writing NSW and Red Line Productions at the Old Fitz – a company that tackled the pandemic lockdown head-on by live streaming play readings featuring artists such as Alec Baldwin and Rose Byrne that attracted worldwide online audiences – was “doubly offensive” during the Covid economic crisis.
“Sadly, the arts has become a fickle plaything for the arts minister, Don Harwin, where he preferences the larger, traditional and established inner-city institutions over the fledgling and emerging groups,” Secord said.
The Greens’ arts spokesperson, Cate Faehrmann, said the clandestine atmosphere surrounding the disbursement of the rescue package was concerning and unprecedented.
“The government has been incredibly secretive about this [new] funding process leaving organisations with no idea of where funds are being allocated,” Faehrmann said.
“It’s a complete betrayal of the arts community during this crisis for a so-called rescue fund to be directed towards a few major organisations while many smaller independent arts organisations are literally at death’s door.”
