As we have reported previously, for the year 2015-16 Creative CNZ covered its shortfall from Lotto from reserves.
Lotto stumps up with around 64 percent of Creative NZ's funding. Government is good for around 31 percent and 5 percent comes from other sources. The problem is that Lottery funding to Creative NZ has fallen around 10 percent a year for the last two years. Lotto is now paying less than it did in 2008 ($27.4 million) and has indicated that there will be a further reduction for the coming year.
Setting aside any ethical implications to the arts largely being funded by gambling (NZ Lotteries started in 1987) what's Creative NZ going to do? In his email Chief Executive Stephen Wainwright outlined CNZ’s plan.
1 Bury its head in the sand
'assumes our revenue from Lotto for 2016/17 is $30 million'
It's hard to see what this assumption is based on as Creative NZ has faced cuts in Lotto's contribution year after year: 2013/14 - $37.5 million; 2014/15 - $31.07 million; 2015/16 - $26.31 million. Surely based on this record of continuing 10 percent cuts it would be more realistic to expect around $22-24 million in the 2016/17 year rather than $30 million.
2 Whistle in the wind
'brief the Minister for Arts, Culture and Heritage on the consequences of the lower revenue'
None of this will be news to the Minister. The Government has barely increased its share of Creative NZ's funding for over eight years (2008 - $15.5 million; 2015 - $15.7 million). From the Minister's perspective Creative NZ's job is to manage the sector and protect its Minister when people send some angry emotions her way (like when their funding is cut). Job well done CNZ.
3 Pass the buck
'we would encourage you to run a series of budget scenarios including one that assumes up to 10 percent less financial support from Creative New Zealand.'
Let’s face it, if the reduction in Lotto’s funding for the coming year is only 10 percent on the 'budgeted' $30 mil it will be champagne all round.
4 Miss the point
'This shift in financial circumstances will be a major challenge for the Arts Council.'
... but not half the challenge it will be for a sector facing another round of cuts. Maybe this time Creative NZ itself will take some of the heat and reduce its 51-strong staff. Hmmmmm.....ok..... maybe not.
