The Economic Meltdown: Arts Organizations Feel the Heat and Finance Minister Flaherty Seeks Ideas for Economic Stimulation
CCA Bulletin 49/08
November 25, 2008
Just the Facts As bad news on the economy keeps rolling in, arts organizations and institutions are beginning to feel the pinch as endowments are failing to generate income.
Endowment funds have been promoted by the federal and some provincial governments as a prudent way to build financial security and promote longer-term planning. In Saturday’s edition of the Globe and Mail, journalist James Bradshaw featured an extensive look at how the dismal performance of the stock markets is placing new pressures on arts organizations. One example amongst many: the National Ballet of Canada is projecting a $ 900,000. 00 shortfall in budgeted revenues due to the current market downturn.
It is not just front-line arts organizations that are dealing with income shortfalls. The Canada Council for the Arts dedicates a percentage of the income earned by its endowment to operating costs and grants. Several endowed Canada Council prizes will also likely be affected, perhaps resulting in lower prize amounts or in some cases, delays in the awards themselves. It is important to note that the Canada Council has not indicated how or if the economic situation has affected its operations, grants, or prizes.
Beyond the arts, the rest of the economy is also trying to cope with this major economic tsunami, to the point where the Minister of Finance, the Hon. James Flaherty, has asked for suggestions as to how best to stimulate the lagging economy. Given the fact that creating jobs in the arts and culture sector costs a fraction of what it costs to create jobs in the industrial sector, it would seem that a good strategy would be to invest in that important segment of the creative economy to see rapid returns.
The CCA is preparing a memo to Mr. Flaherty built around a number of key proposals, including:
What Can I Do?
The CCA would like to submit these and other ideas to the Minister of Finance and the Standing Committees on Finance and Canadian Heritage before Christmas. The Economic Update that the Minister of Finance will deliver this week will provide an excellent context for putting forward ideas to not only stimulate the economy, but also to put the arts and culture sector on more solid footing.
If you or your organizations have ideas that could be part of the Arts Stimulation Package, please either share them with the Minister of Finance and copy the CCA, or send them for inclusion in the CCA brief.
When the Minister of Finance goes looking for ideas, the CCA and the cultural sector don’t have to be asked twice!
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