Exclusive:Scottish Government and Creative Scotland in crisis talks to save jobs and organisations

Creative Scotland hopes to secure critical new investment for the industry within weeks after warning that a number of organisations have reached financial "cliff edges" due to the impact of rising costs and uncertainty over their future funding.

The government said the talks were aimed at protecting jobs in the culture sector and helping organisations facing “immediate challenges.”

Creative Scotland chief executive Iain Munro told the Scottish Parliament last week that “financial and human” resilience in the cultural sector had reached rock bottom, and predicted the country would feel “the cold winds of a cultural recession” without urgent intervention from the government.

Theatres, arts centres, festivals and other organisations - who have no confirmed government funding beyond March - have been expecting Creative Scotland to reveal its next long-term funding programme for six years in October.

However fears have been growing that they could be left in limbo over their results of funding applications until January or February over the government's refusal to commit a budget for the three-year programme.

The company which runs Dundee Rep and Scottish Dance Theatre last week revealed it was having to plan for “drastic consequences” for next year. It warned the Scottish Parliament of a potential "domino effect" sweeping across Scotland's cultural landscape before Christmas if organisations did not have more certainty over their future funding by then.

The Centre for Contemporary Arts in Glasgow revealed at the weekend that it may have to temporarily close before the end of the year due to "unprecedented financial precarity" and a business model it described as "unsustainable."

It is nearly two years since Creative Scotland previously delayed its whole decision-making process by at least 12 months due to a lack of clarity over how much funding would be available.

Although the government has since promised to "more than double" arts spending in Scotland last October and has repeatedly promised £100m in new investment in Scottish culture for the period covered by Creative Scotland's next programme, it has not given the arts body an indicative figure for its next budget.

Its three-year programme is heavily over-subscribed, with a projected funding gap of around £47.5m if it is left on a standstill settlement when the government sets out its spending plans in December.

Creative Scotland has had £2.2m worth of cuts imposed by the government since last year’s Scottish Budget was announced.

The arts agency also said it had been left with no option but to shut down its open fund for artists last month due to uncertainty over a further £8.4m in government funding which was earmarked in its budget and annual plans.

The open fund will reopen next month after the government backed down in the face of a furious arts industry backlash, but it has also announced that it will be reviewing Creative Scotland’s “remit and functions” as part of a wider review of how Scottish culture is supported.

However the ongoing talks between the Scottish Government and its arts agency have offered hope that a full-scale crisis could be averted.

A government spokesman said: “Discussions are ongoing with Creative Scotland to help protect culture sector jobs and ensure support is available for those organisations facing immediate challenges.

“Despite the challenging budget situation, ministers have increased culture sector funding by over £15m this financial year, as the first step to achieving the First Minister’s commitment to invest at least £100 million more annually in culture and the arts by 2028-29, with the aim of providing at least an additional £25 million for the arts and culture in 2025-26.”

A spokesman for Creative Scotland said: “We continue to work to the published timelines for the multi-year funding programme and to discuss future budgets with the Scottish Government.”

Scottish culture was plunged into new turmoil last month when Creative Scotland submitted a bleak dossier to Holyrood’s culture committee warning that the arts industry was facing the prospect of years of “managed decline” and revealing that it had been targeted with funding cuts as part of a new Scottish Government squeeze on “non-essential” spending.”

Given evidence at the parliament last week, Mr Munro said: “We are working very hard behind the scenes with a number of organisations who are in crisis and are on cliff edges. That is increasingly happening.

“The resilience within the sector, financially and human, is essentially at rock bottom.

"I’m not going to name any organisations, but people would be very concerned to know who they are.

"They are significant organisations, in different communities and parts of the sector in terms of what they represent. Some of them are nationally and internationally significant.

"That is the reality of the challenges which have been eroding the business models of these organisations for some time.”