Michael McGregor, director, Wordsworth Trust

Michael McGregor

Only time will tell if the Action Plan will bear fruit but in a time of financial austerity there is real need to do something and this is a serious commitment at government level to address the issue. As with many such initiatives, its success will depend in part on factors outwith its control, but it does offer a range of possibilities.

The £80m matched fund certainly has the potential to encourage more people to support the arts, but, as always, the devil is in the detail. How easy will it be to unlock match funding?

Accountability is obviously important, but it is also important to avoid an overly bureaucratic scheme that ends up discouraging donors and creating extra work for cultural organisations.

A headline sum of £80m sounds impressive, but spread it over five years and distribute it across the cultural sector nationwide and it starts to look a lot smaller. Also, one of the stated aims of the fund is to help those wishing to develop endowments.This will presumably involve handing out fairly substantial sums, which will quickly eat into the £80m.

Having said that, in terms of stimulating funding, the match funding scheme is crucial, along with promoting an increase in planned giving and supporting the long-term development of endowments.

It is encouraging that endowments are firmly on the agenda, with two substantial reports having recently been produced. As the Arts Council report rightly observes, endowments alone are not a solution, and need to be thought about as part of a longer term strategy. The challenge with endowments is that they involve substantial sums of money, particularly in a period of low interest rates, in order to get any significant return. And in our experience, it is difficult for smaller arts organisations to convince donors that they require a substantial gift.

Probably the best opportunity for many organisations to build an endowment is through legacies, and it is encouraging that promoting and increasing planned giving is part of the government’s Action Plan.

My experience of fundraising in the cultural sector is that the pool of donors that regularly commit large sums to cultural causes is very small. A major challenge will be encouraging serious philanthropy in a new generation of high-net-worth individuals.

The idea of more visible public recognition for philanthropy is interesting, and there are already schemes such as the Prince of Wales Medal for Arts Philanthropy that are endeavouring to do this. However, as the book Why Rich People Give identifies, self-actualisation is only one of a number influences on giving by high-net-worth individuals.

With regard to developing fundraising skills and capacity across the cultural sector, care should be taken not to duplicate work carried out by existing bodies such as the Institute of Fundraising, of which a number of arts fundraisers are members. Indeed, an organisation like the IoF can help achieve another of the objectives in the Action Plan - strengthening links between culture and other sectors.

With regard to encouraging more investment by the business sector, I am not sure what new initiatives can be created that have not already been tried and tested by Arts & Business over the past thirty years, but will await developments.

The reality for the majority of organisations is that individual philanthropy means relatively modest donations from a pool of committed supporters. Making it as easy and as attractive as possible for these donors to give tax-effectively is one of the most important things that the Action Plan could achieve.

Michael McGregor
Michael McGregor was appointed The Robert Woof director of the Wordsworth Trust in August 2008. Prior to this he held a number of posts at the Trust, including director of Development. Outside the Trust, he has worked in a fundraising capacity for a variety of arts organisations, including National Museums Liverpool and Arts & Business. He is a member of the Institute of Fundraising.

Wordsworth Trust
Tel: 015394 35544
Website:www.wordsworth.org.uk