 Gwyd morhwng, gallwch argyfwngi wneud anim i'r pwysig iawn oherwydd Gwyd CSU i ysgredd Prydwr Samsungol Cymru yn 2023. Ysgredd byw peth yn cyfan iawn o'r pwysig iawn o'r cwrddur ag yn digwydd a'r oedd yn cyflawniol Cymru i 23-24 oed. Fynaun iawn i'r pwysig iawn oedd bydd ar gynnig i kymru lleoedd yr oedd yn cymryddiol Cymru yn y taest y rai wnaeth aethau yn ateb yma i gyflymaeth Alex Paterson, cydwn yn ymgyrchu ar Gwyd Gwyd Scotland. Ian Monroe, chief executive of Creative Scotland, Donald Smith, director of the Scottish International Storytelling Festival and chair of the programmers group festivals Edinburgh, Chris Sherrington, policy and strategy support for music venues trust, Moira Jeffery, director of the Scottish Contemporary Arts Network and Sir John Leighton, director general of the national galleries of Scotland and thank you all for your attendance at committee this morning. Can I begin with a general question? In our pre-budget scrutiny report, we concluded that the sector now faces a quote a perfect storm as it struggles to recover from Covid-19 pandemic compounded by the cost of living crisis and falling on from longer term budget pressures. What is your assessment of how the Scottish budget for 2324 has responded to this perfect storm and how, if at all, has it outlook for the sector changed from the evidence that was presented to committee a couple of months ago? If I could begin by inviting Ian Monroe, please. From our perspective, I do not think that the Scottish Government budget settlement for 2324 has responded to that perfect storm that I was outlining to the committee. I think the risks to the future of the culture sector as we currently know and understand it have gone up enormously as a result of that budget decision to Creative Scotland. Now we are in a position where we've somewhat unhappily, I have to say, stepped in with national lottery reserves to offset that cut for 2324 and avoid passing on. The impact of those cuts in less than three months' time. But given what we're seeing and hearing at the moment about the years ahead, if those cuts are sustained because the use of national lottery reserves is a one-off for us, then we will have to be passing that on to the sector. Unfortunately, what that means is not a happy picture at all. I can give you some illustrations of that, but even understand still what we're going to achieve through the use of our national lottery reserves in 2324. It's still my estimate at the moment that a quarter to a third of the current 120 RFOs are at risk in the months ahead. If those cuts endure into the years ahead and we don't have the national lottery reserves positioned to offset them and we end up passing them on to the sector, it's my estimate that we will probably see no more than 60 organisations out of the 120 current RFOs funded. But if that wasn't troubling enough, we have an expectation that there will be 250 to 300 organisations beyond that interested in multi-year funding. They, too, would be unsuccessful in the way that the budget settlements look currently. It's not a happy picture, I think that's an understatement. I think that there's a lot of unhappiness that exists about the implications of that. I think that it's on the back of the last two or three years where things have been tough enough because of the pandemic, but it's on the back of sustained standstill funding, which we've acknowledged for some time is not a sustainable position in and of itself. In this environment particularly, with inflation, energy costs and so on, in real terms that's probably looking like a cut of 20 to 30%. That's before we've applied these hard budget equations and the decisions that we would ultimately need to make on multi-year funding. It's not a happy picture, as I say, and we will do our very best to try and keep things calm and stable in the funding offer that we've got in the year ahead, but in the years ahead I think it's going to be even more difficult. We are heavily reliant on our national lottery income stream to support the direct programmes for individual artists and for organisations that aren't in receipt of multi-year funding, but the pressures are going up exponentially as a result. I'm just going to come to everyone in turn for that, Ms Jeffrey. Do you want to respond? First of all, I'd just like to thank the committee for inviting us to give evidence today. I have 300 organisations and individual members across Scotland. I've met with many of them since the budget was announced and it's so important for their voice to be heard here. We've already mentioned the perfect storm. This creative Scotland has left my members without a lifeboat. There are 120 regularly funded organisations across Scotland, and as Ian has said, hundreds are out there looking for multi-year funding. That's 5,000 jobs within the RFO network alone. Those jobs are in places such as Portre, Lumsden and Huntley in Aberdeenshire, places such as Leibster and Caithness. People are creating a really uncertain future because of those cuts. That is on the back, as we know, as the committee knows, well of long-term standstill for the sector. My members are telling me that once those jobs are gone, they're not coming back. Mr Smith? Yes. Obviously, festivals generally across the country share a lot of the pressures, including other things such as the Covid hesitancy factor in terms of rebuilding audiences, a process that has, however, begun. The very low level of international tourism, knocking on posts, which I know is affecting galleries and so forth, as well as festivals. I think that the angle that I might add is that public support, while critical, is not the only factor in this crisis. A lot of us who are on the front line of this are now very much focused on how we can adapt to survive through this next period. I think that there is a very constructive dialogue begun with funders about maximum flexibility in the way existing funding is deployed, about focusing on what the key strengths of individual festivals, whether locally, nationally or internationally, are, rather than having a generalised tick box where all funded organisations are expected to do A to Z. It's a really tough picture. Festivals have taken a hammering, but we're hanging in and looking at how we can adapt and get through this. Mr Sherrington? I'd also like to thank the committee for the chance to speak today. It's been great to come up and speak with a view to how the grass-roots music sector is struggling at the moment in time. My colleagues will often talk about how to give a good picture of how the public funding cuts are going to have a real impact on that. It's very disappointing for grass-roots music venues who post Covid and have received wonderful support through that and have started to look at more public funding support beginning to emerge and look at that. Now they're faced with basically being told that there's not really much chance of them getting funding from that. The big concern from the budget for them is that, unlike in England and Wales, where they continue to receive support from business rates relief, is that in Scotland, only 10 of the 84 grass-roots music venues that we represent will be able to receive any rates relief at all. There's a real concern that that produces a lack of competition against both Wales and England, which means that they will in the end end up putting up ticket prices, which they find difficult to do. For the money that they're looking at, they're going to have to increase the income that they're going to have to get in to cover those costs by over five times. That is a real concern for venues because they don't feel as though with everything else that's going on and the cost of their energy costs that are going up as well, to have a fixed cost such as business rates being imposed on them, whereas their colleagues and compatriots in other countries are not having to face that as a real concern for them. We do see that there is a real opportunity to start going out into the commercial sector and try and get investment from that, and we recognise that there is a need to increase on that, and so it's good to see things around the overnight levies. We would also look to encourage that there needs to be more investment from further up in the industry. High ticket price events have very little impact upon supporting grass-roots music venues, and, unlike in football or other areas where the premiership teams all get to support the lower routes, that doesn't happen. We would encourage the committee to look at options around ticket levies on the higher end ticket prices to support grass-roots music venues, but the budget at the moment, unfortunately, is the same menu with the concern around business rates, and it really does put grass-roots music venues in Scotland at a disadvantage compared to the rest of the UK. The last time I appeared at the committee, I outlined a very stark position for the national galleries and national collections in general, and we talked about some of the generic issues that are faced right across the culture and arts sector, the lingering effects of Covid, the inflationary pressures, the loss of self-generated income, and so on. That's all very familiar to you. We also talked about some of the particular issues that are faced by collections of national importance. The high proportion of fixed and unavoidable costs when you're securing and caring for priceless world-class collections, the high costs of maintenance of the buildings and the state and infrastructure that goes along with that, all at a time when we're still all trying to rebuild audiences. That was a very stark picture and we faced, according to some of the projections that were in circulation at the time, a fairly massive deficit this year. I can say that the draft budget recognises those particular pressures certainly for the national galleries and I think also I can speak for the other two national collections. I can see a way to balance a budget next year, which is a rather different picture from looking at a budget of a deficit of seven figures or one and a half, 1.6 million as we were projecting before. That in a sense is something of a relief for us. I would say that the underlying structural issues that others have mentioned, they don't go away and we will also have to work extremely hard to keep on building those streams of revenue and income. We'll have to hope for the fair wins in the recovery of audiences and the return of those audiences and we'll have to keep on looking, as other organisations will, looking very hard at operating models and business models to see if we can maintain levels of ambition and access but do that as effectively and efficiently as possible. Particularly when the messaging that's coming through is that if you think this coming year is hard, then you'd better prepare yourself for much harder years to come in two or three years' time, so we take that messaging on board. However, I spoke to you this morning in a somewhat different position from the last time that I was in front of the committee, so I would acknowledge that the Scottish Government has recognised the concerns that we laid out. Again, echo my colleagues. Thank you for the invitation to come and speak to you again. I think that your question at the outset, convener, was, are the pressures still there? Yes. As I said in the last time, the impact of Covid has not gone away, though clearly easing, and the cost of living challenges or the general economic challenges for those to do with utilities or inflation or other fixed costs have not gone away either for us as an organisation or for the wider sector. That said, I would echo what Sir John said, and I would just acknowledge the support that we've had from the Scottish Government through the budget process. We've ended up with a grant and aid settlement, which is 5 per cent less than the resource spending review suggested it might be, given the challenging budgetary environment in which the Government is operating. As I said to the minister, I thanked him for a good settlement. Of course, we look at those things through different lenses, so I'm looking at it through the lens of Historic Environment Scotland, and that's our view. Of course, it's important to say when you're looking at our total budget for next year that the grant and aid is one component part of it and a major part of our income, and our budget is the income that we generate through non-grante rate sources, so access to our sites, admission charges, membership, all the other commercial activities that we generate. The evidence that we've seen this year is that the visitor economy has come back faster, stronger than we anticipated, and we foresee that continuing into 2023-24. When I add what we regard as a good settlement for the year from the Scottish Government with what we see as opportunities from the commercial aspects of our business improving, then, for the 2023-24 year, we are in a better position than we thought we were going to be when we embarked on the budget-setting process, which helps us to do a number of things. Obviously, as I said last time, we were expecting a very significant increase in our utilities costs. We still are, maybe not quadrupling, as I said the last time, but certainly doubling, which is quite significant. I'm delighted that my colleagues have got a very good pay settlement, but that adds to costs and so on. We carry increased costs before we do anything, but with the budget it will feed through into a number of areas where organisations and people across Scotland will see the benefits, so we will invest more in our estate, which is fundamental to our core business. I fully expect that we will invest more in our grants programmes, so all our organisations will benefit from that as well. To summarise the challenges and the pressures are still there, but, from my highest point of view, we thank the Government for giving us a good settlement through grant and aid, and we can supplement that through what I hope are realistic estimates for commercial income. Thank you very much. It was a mess of me not to thank you all for your previous written submissions to the budget process and the newer updated ones that have come in from organisations before today's session. I expect a bit of a free-flowing round-table discussion, so if you do want to come in and answer a question, if it hasn't been directed at you by one of my members, please just grab either my eye or that of the clerks, and we'll try and ensure that everyone gets in if they want to contribute. I'm going to open with questions from the committee and if I could invite Ms Boyack. It is good to be able to follow up the discussions that we had last year. I want to pick up on the opening comments that we had from Ian Monroe from Creative Scotland, because your comments about the number of organisations that you fund and the potential impact on budget cuts, because it's having cuts, but also with significantly rocketing costs. It's looking at what the opportunities are, because we have raised things like percent for art and tourist visits are lively, but they seem a long time off and social prescribing seems a long time off. It's thinking about what do you think the solutions are now, because those organisations, and I think that it was in the SCAN report as well, there's already been a hollowing out and there's lots of artists and cultural workers have gone already. What would your solution be in terms of advice for what we should say in our budget report? I think that those ideas that you mentioned are, of course, ones that must be pursued, but what I would say is that they are supplementary to core culture budgets, which are the foundation or cornerstone of the business models of so many organisations. It's from the confidence of those public funds that they can build their relationships and their other earned income and their sponsorship and philanthropic giving and so on. At the very heart of this equation is a solid and confident public funding settlement that should be seen as investment. It's investment in those organisations for culture, but it's also the case that that investment translates into social impacts and economic impacts. I think that those wider impacts are also at stake here. When I mentioned earlier on the concern that I've got with these cuts enduring, it will undermine that confidence in public investment in those organisations that will have a ripple effect negatively in the eyes of others. The size, shape and diversity and the reach of those organisations is what I would predict if those cuts endure will reduce enormously, and that means that all that cultural, social and economic value contracts. I think that we can't lose sight of the fact that those other ideas are definitely ones that are to be pursued, but they are longer in the medium to long term in terms of when they might even come on stream. Until you can get to that point without core public funding at the heart of the equation, you risk losing those organisations that offer so much anyway, so there will be no provision to the extent that we currently see and understand it at the moment. It's self-defeating in that regard, but none the less those ideas and the work that's done in terms of cross-portfolio, so health and education and so on. All of that is important, but it's supplementary to core culture budgets. Moira mentioned earlier on the jobs position of the 120 RFOs. That's 5,000 jobs direct employment, but beyond that, it's also worth noting the millions of attendances to cultural venues that are associated with those 120 organisations, as well as the 25,500 support opportunities for individual artists that are associated with all of those organisations. That's just the regularly funded organisations. There are many hundreds of organisations beyond that that are similarly supporting individual artists, but there are also assets in their individual communities right across the geography of Scotland. There are also working in very important areas that are in cross-portfolio areas of health and education and so on, addressing matters of inclusion and diversity. The wider ecology and network of organisations that we currently see is what is fundamentally at risk without sustained, adequate levels of public funding from which they can build their other income streams. What's also being mentioned today, of course, are audiences. The pattern of audience behaviour is not yet a settled one post-pandemic, but it is the case that audiences' attendances are down in certain quarters, particularly for paid venues for performing arts, but not exclusively. However, they bring with them not just ticket sales through purchase, income through purchase of ticket income and so on, but barcatering retail and the wider visitor economy. The overall financial equation has to be grounded in a confident culture budget settlement for the years ahead. Unfortunately, the way that it is looking at the moment, I think that there are significant risks to that, and I think that we will see a major reduction in all of that provision in the years ahead if there is no fundamental change. I think that that is a really powerful warning to us. It is a budget cut that is going to actually have real impact, because I think that a lot of those venues have already started to dive into the reserves, so there is not going to be any spare cash left for organisations to keep going, never mind investing buildings. That is really powerful evidence. Can I follow up? Myra Jeffery, in your submission to us, you give us some really powerful case studies that cover those wider community benefits, the impact on the economy and the loss of jobs. If we lose people from arts and culture, we do not get them back. Do you want to say a bit more about that? Yes. A number of my members have provided case studies. If I could start with Devrim projects and Huntley, director Natalia Palumbo, who shares some information with me. In terms of impact on hospitality, business and education, the importance of core funding for culture is really evident in our small towns and villages. Devrim projects get less than £200,000 a year. I think that it is about £110 a year. It has a team of six people. It supports approximately 50 artists a year, so that core investment from residents to facilitators, researchers, etc. Audiences from all over the UK come to more than 200 events a year in rural Huntley. That has an instant impact on the renting of property, staying in local B&Bs, people shop locally, they go to bars and restaurants, they contribute to local schools and initiatives. Devrim projects also have a key role to play in the town centre. Since 2019, they have taken over an empty property in the town. They have built a space for the local community and for an international creative community. It hosts events, it has incubated two community businesses since it has opened, and it provides free space for community groups and is available for commercial organisations to hire. All of that has been built by artists and cultural workers from a tiny team with that core investment. It simply cannot continue with that core investment. Another really helpful example to understand would be Atlas Arts. Atlas is based in Portree and works across Skye, Razi and Lochalsh. It has income of £150,000 a year. Those are infinitesimal sums if we look at this across Scottish Government spend. This investment allows Atlas Arts to plan ahead. It supports four core jobs, but it also supports dozens of freelancers. Atlas has two boat-build cafes, a community boat race, a new Gaelic children's book, a Gaelic artist residency, two long-term artist commissions, and they are from Scottish Artists, a library of community-made books, film screenings and multiple partnerships across Skye, Razi and Lochalsh. What is really important to understand about this is how Atlas describes its mission. It describes itself as the connective tissue in this community. Working in partnership with local charities, with local authorities, it has created apprenticeships, worked with local restaurants, huge investment in local highlands and islands freelancers, it creates jobs and training opportunities for young people that have a huge effect in this location. That is what we stand to lose. That is on the basis that this is not coming back. The big question for me is that I just do not understand the strategic position that leads us. Those organisations are meeting the performance framework. They are meeting the outcomes that the Scottish Government is asking of them in communities right across the country. I cannot understand the strategic framework that suggests that this kind of reduction in investment is sensible or appropriate for those communities. I was wondering if, Donald, you want to come in because, in terms of festivals, you mentioned visitor hesitancy post Covid, but there is also cost to living crisis. Have you thought about what we need to do more to enable festivals to be successful? We have already lost film house and film building, which is impacting on the film festival. I was going to make the comment that we do not need to be predictive about all this. It is already happening. We have lost the international film festival and two venues, although I acknowledge that, again, there is an adaptability and resourcefulness in our sector that is going to be absolutely critical. I acknowledge that funders and activists are struggling to find a formula to take forward a new model for a film festival. I hope that the committee, acknowledging what both Ian and Moira have said, might urge the Government that, in the next funding round, our sector would not be picked out for a reduction. One wonders, pragmatically, if the existence of these lottery reserves left in this budgetary round, Creative Scotland would be a little bit exposed. I am not sure what the background to all that is. I hope that the committee, for all the reasons that have been outlined, would recognise that a positive settlement for the creative sector as a whole, including the festivals. I do not think that festivals exist in isolation. They work with organisations in localities, support creative artists and have strong connections with community networks, the health sector and, of course, schools and education. One of the things that I think is important to say is that, over recent years, in a combination of policy development, grass-roots activity and the way new, multi-purpose arts organisations have developed and emerged, the contribution of the cultural sector has grown enormously to the objectives of Scottish society, as expressed through Parliament, local government and the Government. The issue of local authorities is also pertinent here because, clearly, local authorities are also under enormous pressure and local authorities are another important backbone of investment in local and regional cultural venues of all kinds. I echo what others have said. I am pleased that the national collections and the historic and foreign Scotland have received settlements that address the real crisis issues. I hope that the committee will advocate that the broader cultural sector deserves similar treatment as we move forward. Is it possible to get just a sense from you, Chris, about what kind of money we are talking about in terms of business rates? There are only 10 organisations that you said have support, but presumably that is not a massive amount of money. I suppose that the challenges that go back to your point, Donald, about local authorities, are less income. Currently, looking at the information that we have been able to gather from venues and the rates, it would be about £1 million annually minimum. Depending on the views of it, it is either a lot of money or not. One of the big issues that has been mentioned is that, in England and Wales, retail hospitality and leisure relief, which a lot of the grass-roots music venues were able to receive, has not been carried on in Scotland and was initiated in England in 2018 as the thing that would carry on has been kept on as a temporary thing. Currently, looking at the information that we get, we would expect across the venues that we look after. I would say that there are also additional venues as well on top of that. We are looking at about £1 million that that would be covered to cost that. Talking about ways in which we are aware that local authorities are under pressure and we are not saying that we want to take away that money from them, but compared to the rest of the hospitality sector, venues in particular have extra costs on top of what hospitality would normally go through, as well as the usual bar and catering costs. There are the additional performance costs, which often they are having to supplement and invest into on many loss-leading performances and things like that, which then goes on to develop the grass-roots performances. For every £1.25 that we invest in two performances, we only receive £1 back from ticket costs and the rest of that is coming from bar costs to cover that. Having these additional costs on top of that really is going to be a struggle for them. One thing I would say is that there are opportunities within the music sector that probably are not available in other areas of culture. I mentioned about the ticket levels, and that is that at a grass-roots level, the average ticket price is £10.90. Being able to make up those extra costs, the £1 million that we are looking at there from that, is really not possible because we would have to increase ticket prices quite substantially, which would then mean that when it comes to bookings, artists would not want to increase the ticket prices compared to other areas of the country in the UK. However, if we were to look at increasing the ticket price on, as I said, the further end at the arena shows and things like that and looking at a ticket levy there, just the £1 increase on shows at the two arenas in Scotland would probably generate £1 million within the year, which would help offset the costs that we are looking at. That is something that we would really look at as a short-term solution and something that we would be able to implement quite quickly. It is the idea of a pipeline investment fund that would take money from the top end of the cultural ladder and invest it back into grass-roots. That is something that could be done—it does not necessarily have to be legislated. It could be done with opportunities to push towards and influence the arenas and other larger contributors. A £1 ticket levy there—the average ticket price is about £60 on that—makes much less difference to the person who is buying it. Often, there are already ticket levis in place for those particular arenas. If you buy a ticket for those shows, you will see that there is often a levy for the venues. We would decide to see that money being also used to invest back into grass-roots music. I think that there is an opportunity there. That is one way in which we could look at covering that extra million pounds. That is very helpful, because I do not think that we have had that issue raised in the committee before. I know that there are issues about changing ticket prices as you get nearer an event. You have mentioned £60. I have seen much, much bigger prices than that, so there is something about where does all that money go. That has been really helpful, because I think that stark issue about not enough money has been a long time when there has not been enough funding, but this year is going to be a crisis going forward. I appreciate that. I am sorry. We announced the Pipeline Investment Fund as an idea back in 2018. It has been a really good way of getting industry to be able to invest back into it. This year, we have launched a fund that we administer through MusicVenus Trust, which is giving out money to venues for them to take part in investment development. Currently, it is limited to £5,000, but I would say that, for a lot of those venues, £5,000 is a massive amount of difference, because it allows them to invest in production, improvements, sound desks and staff training. Even in the two or three months that has been opened, we have seen over 100 applicants for it, and we have been able to distribute £120,000 already in that period of time. That is money that we have managed to raise from national lottery events that we have run and have ticket income come back in. There is a framework for that kind of ticket levy to be put in place and for it to start the investment straight back into venues directly. I am returning to a familiar theme, Malik Patterson, about the opening of the state. HES has had an uplift, but I appreciate it. It is one that is needed, given the enormous estate that it has to maintain in difficult times and the lack of ticket revenue that it has. Can you say any more about what the plans are to move back to a model in more sites where tickets are being sold and what the number of sites that are presently closed are? I will not go over the whole high-level masonry that we discussed the last time. First of all, inspections are progressing well. We have done over 30 inspections at sites across the country now, which is good. We are doing them right through the winter because the weather has been quite conducive to that. The inspection programme is ahead of schedule and going well. Bear in mind that the whole rationale behind the high-level masonry project is health and safety, so we will only improve access or open sites where we are comfortable that the health and safety concerns that we had have been addressed. However, of the 70 sites that were in our concerned group, we have been able to open or improve access to over 30 of them thus far. That does not mean that they are all open, but it means that we have improved access. I was asking my team yesterday that, since I was last here in the last week of September, where have things improved? Just to give you a few examples, you might have seen about a press release this week to say that Dumbarton Castle will reopen, which is hugely important. I spent a day with politicians and with the stakeholders of Dumbarton in December talking about what we might do collectively, but the key there is opening the castle. We will get it open. We are suggesting that it will open in March. However, that is a good example where we had an issue and a concern. We did the inspection and found stuff that justified us taking the action that we took. Our teams on the ground were able to fix the problems that we identified and were able to say that we could reopen Dumbarton. Loch Leven, Aberdawyr, Pollywood Abbey, Coros Abbey, Andrews Cathedral and a number of others have said that we are going to reopen as a result of the inspection programme. There are others where we have improved access, so if you go to Dyrrltyn or you go to Driver Up, access has been improved. What that does in terms of income is that there are clearly some sites that we haven't benefited from the income over the last 12 months. When you look at our forecast commercial income, there are some assumptions in there. For example, in June last year, St Andrews Castle opened in August. We will have those sites for the full year, but then there are other sites such as Dumbarton, Aberdawyr and so on that we haven't had at all this year that we will be able to bring on and contribute towards our income. That is where we are, but to be assured, our focus and absolute priority is to get as many of our sites open as quickly as we can. The inspection programme, and we have done a lot of our big sites, some of the smaller sites will not happen over the course of this year. Our priority is to get the sites open as fast as we can because we know that it has an impact with local communities and so on, but we can only do it when we are certain that the health and safety issues have been addressed. I cannot sit here a year from now and say that we have opened some sites because we thought that they might be okay and actually we have had an issue, health and safety drives us, but we are making really good progress. It would be my thought to you. I think that there is some pretty sobering evidence this morning, so thank you for that. I wanted to ask you collectively about the policy that organisations have on reserves. Obviously, for Creative Scotland, there is quite a big impact for this year on your reserves, but in terms of wider reserves policy, does the budget and some of the headwinds that the cultural sector is encountering mean that there needs to be a rethink around reserves policy? Are there particular demands on reserves beyond this budget that organisations are going to be facing going forward? If I can maybe start with Ian, then we will go around the table. For us, as an organisation, I will start with on reserves policy and then talk about sector organisations. For us, as Creative Scotland Public Body, we have got that avenue of income beyond Scottish Government budget, which is national lottery, which has no annuality attached to it, which does mean that we can build up a reserves position. That is a good practice thing for any business anyway, in terms of being able to maintain a reserves position. We have been pursuing that for a variety of reasons anyway, much of which was about how we could use them to sustain the organisations through the headwinds of the perfect storm that we have talked about previously. Using our reserves to offset the Government cut means that it is not available to be used for those other purposes. In a way, it is a give-with-one-hand take with another. I think that there is good practice there for us to continue with that, but we are not allowed to build reserves in relation to Scottish Government funding because of the annuality point. What does that mean for organisations? It is worth recognising that we were really pleased to be able to negotiate and secure an enormous package of additional support measures from the Scottish Government during the period of the pandemic. Over two years, it was an extra £151 million in that period. It was fundamentally important to be able to sustain organisations through all the challenges of that period, but some of the later packages in particular enabled us to support organisations to build and strengthen their business models, including options to strengthen the reserves. Unfortunately, given the economic pressures that are part of that perfect storm, much of that has evaporated already. We are not just in a position now of there being no financial resilience left in many parts of the sector. We are now hacking into the bone of that. However, as many of those organisations are charities regulator, I am sure that we will be looking to organisations to have a reasonable reserves position. However, much of it has gone. We are in a position now where the fragility that pre-dated the pandemic is back tenfold because much of the good work that was done to help to strengthen organisations during that period has now gone, as I say. There is no opportunity to further tackle that. There are no financial safety nets in this current equation, like there were during the period of the pandemic. We will always want to encourage good business practice in the governance of all sector organisations, but their ability to secure that is deeply challenged in the current environment. My organisation, the members, are reporting that they are using their reserves simply to meet their wages bills. If we can take an example like the Fruit Market Gallery in Edinburgh, a hugely successful gallery, audience figures gradually returning to near pre-pandemic levels of 96,000 visitors in April. They have really effective fundraising mechanisms but rely also on funding from Creative Scotland at its core. That funding has been at standstill for well over a decade now. The cost of simply applying the living wage and its equivalent across their staff team of 53 people is £105,000. That is all coming from reserves. By the end of 24 to 25, they report that they expect to have used up all of their reserves on running the organisation. This is meeting the living wage. We are meeting increased costs in terms of artists' rates and permanent salary staff. There is an aspiration to meet benchmarks that everybody else would meet around the public sector pay deal. That is simply to meet wages. The organisation has experienced a doubling in its energy costs. The question of reserves is that reserves are disappearing fast. There are one or two pragmatics around the front-line organisations and the activists that keep the whole culture sector, particularly in its community aspects, going. Clearly, there is a huge raft of cultural organisations and all the individual artists and creatives who operate as one person businesses who have no reserves. That is simply not a relevant issue. It is a slightly corporate question. I will flip that for a second. I am also leaving for the positives. We have just finished the Year of Scotland stories, which was one of the most successful of the themed years that we have had in Scotland. The specific huge success was the small grants programme, which drew on Scottish Government finance and on national lottery funding. A huge number of local community organisations benefited in the report and evaluation that is coming out with the huge positive outcomes from a relatively modest investment, but that investment was in that sector of people who just are not operating on corporate models. That is a lot of the grassroots energy in the arts. That is where the public support programmes, wherever they come from, the public sector, the lottery and so on, are absolutely essential, because those people are just living from one project to another. On the organisational reserve, Ian referred to that as most of us are charities. We are under a cost to have enough money in hand to fund closure, to meet redundancy costs and wind down. That is a requirement of the charity sector. Quite a number of organisations will be on the risky edge of not being in that position to meet statutory requirements. That is the kind of vary from the pragmatic front line. You need to hold on to enough money to wind down, which sounds rather pessimistic. I think that that is what people will be looking at. I noticed in a Scottish Government culture department seminar that I was at was a kind of line of thinking about what is essential to save. Is that where we are really at? What is going to go to the wall? If that is the situation that we are in, can we have some kind of strategy or review around that about what is critical, or is it just going to be a process of attrition whereby different organisations and venues will go to the wall? We will not kill them, but we will not strive officially to keep them alive, as it were. That may sound a bit grim, but it is to a degree some of the corporate discussion about clets of investments. It is absolutely critical, but the pragmatic reality of running venues, festivals and organisations are the issues that are now survival on what basis to get through as Sir John was referencing there. I do not think that this is a one-off year that we are facing. It is not another question. I would like to put it in my mind that I would like to air how the cultural thing as a whole contributes to the international standing of Scotland. That is not an issue that we have really addressed and the innovation and all that, but we will come back to that just by addressing Mr Russell's question. One of the major issues in the grassroots sector that we are looking at with our members is that the majority of them, although they act in a not-for-profit fashion, are not set up in a not-for-profit structure. That is mainly because the fact that a lot of the venues are driven by initially a need in an area in a community, which is often driven by one or two people saying, we need to replicate this, we need to set up a venue, we need to do this. For many of those places, they will set up as sole traders, although they are set up in a limited fashion. I do not always say that because the fact that we are often seen as hospitality venues which do music, which is definitely not what they are, they often are set up in a commercial structure and so therefore do not actually look at that charity setup. We have been encouraging a lot of venues to transfer over to that thing, which would then involve them to look at reserves. The impact of that is that, as a result of that, many of them do not have reserve structures in place. Many of them were also ineligible for funding support during the pandemic, mainly because the fact that it was aimed at limited companies and it was aimed at those kind of prerequisites and we saw a massive issue with people not being able to partnerships and sole traders and not being able to receive funding through that. The other thing is, as I said, that many of them do operate in and off a profit thing as much as they are not making profits and also the rewards for the people involved are much lower than they would be. We found that when we asked venue operators what their average salary was in comparison to the rest of the arts sector, which is usually around for venue managers, about £35,000, for most of them it was £20,000. In fact, the answer that we mainly got was, I haven't taken any money at all with salary. Reserves, it was interesting when, during the pandemic, we hope that lots of venues were encouraged to receive funding and apply for funding and for many of them the question that was asked was, what are reserves? Because they were able to apply for reserves within that and I would further answer what Ian said. I would thank the Government for their support during the pandemic. It was a wonderful strategy of support. Unfortunately, a lot of venues were unable to receive some of it and, as I said, they are not living off reserves at the moment. They have never really had them because they are often investing straight back into what they want to do. If they have the question of, should I invest in a new sound system or should I invest in the next artist, they will take that as that is where they should be focusing before they put reserves in place. That is nothing against the business nuance of these people. It is just the idea that they have never had the excess money in the first place and often have been unable to apply for public funding which requires them to have reserve structures in place. We have seen an increase as there are tax breaks and we are encouraging venues to take part in it but that is also why, as a result yet, why I mentioned about the business rates is that, unlike a lot of charities that work in the sector who are already receiving reliefs around business rates, most of those venues are not eligible for it. Unfortunately, most of those venues have not had reserves and any of them did have all wiped out during the pandemic. I echo what colleagues have said. In a situation in which the sector faces reserves is not the answer. In business terms, it is obvious that reserves are there for, if they exist at all, for short-term crisis funding. Issues that we face are not short-term, they are long-term. In relation to the National Guard of Scotland, as an NDPB, we do not tend to hold reserves or build reserves within the NDPB because of the annuality that Ian referred to. We do have the support of an independent charitable foundation in which philanthropic funds can go. Those tend to be used not as reserves but to support long-term projects that require multi-year funding, which is harder because of the annuality of NDPB funding to do. Is it possible in a Scottish context to look at something like an American model in which you would build up an endowment fund? Those are not reserves, but would be an endowment fund that would help to relieve some of the funding pressures. The capital sums involved are huge before you start to generate any income that would be of interest. Endowment funds are exposed to the very risks across the economy that we are all familiar with. I do not think that it is something that we are going to be able to pursue with any great degree of success. I agree with what my colleagues have said. We know organisations in the heritage sector who are using reserves just to stay afloat or to try to stay afloat, and that is not the purpose of reserves. I concur with that. Through our grants programme, one of the things that we are trying to do is support organisations to be sustainable and resilient, and, of course, they have all their costs and other pressures, just as any organisation has. The issue of reserves is very significant in the fact that they are diminishing or not there. From a HES point of view, we are an NDPB and we are not allowed to carry our bill reserves, so we have that same restriction. We also have a foundation into which some philanthropic funds are put and managed. However, when I was here back in the end of September, I floated the idea that the business models of my organisation of other NDPBs need to be revisited, because the challenges of Covid would not have been offset by any reserves that we had built up, but the fact that we are not able to or to do other things in a world where things have changed a lot, might be that there are some flexibilities around the NDPB model that we would be worth considering. We are discussing that with our minister and our sponsor team. It is hard to find a solution to the challenges that we have all discussed this morning that do not come down to money. That is the bottom line given Covid and given the economic and the cost of living challenges that everybody is facing. If you take a slightly longer term view, and I said this the last time, but I take every opportunity to say it, we have to think about what end of the telescope are we looking at culture and heritage through. If we look at it just as a very narrow part of what we all do and consume and enjoy, but it is always going to be quite squeezed for cash, that is one way of looking at it. However, Moira's intervention a week while ago was really powerful. It is what I said the last time. If you look at the contribution that heritage and culture and historic environment and all those related elements contribute museums and galleries, it is not just to the narrow definition of culture and heritage, it is to the economic development. The historic environment sector contributed £4.4 billion to the economy in 2019 and supported 68,000 FKE jobs. That is not small. In Ian, the numbers for the wider creative sector comment about wellbeing. An awful lot of what we do in our sector collectively is at the heart of communities, not just in Edinburgh but in Kirkwall, Lerwick and Stornoway, it is geographic across the whole of Scotland. Seeing what we collectively do and those we represent do through the lens of economic development, the jobs that we create, the skills that we invest in, the community building that takes place, the contribution to net zero that it all makes, that is quite critical. I have been able to think, well, let's not look at it just from a narrow perspective, let's look at the wider contribution that we make. We reckon that we as an organisation contribute to all bar one of the national performance indicators, and the same could be applied to other organisations around the table. I will reflect on what my colleague Mark Ruskell said, and I think that I used it at the last session as well. That is incredibly sobering. Donald Smith, you must have read my notes. My first quote that I wrote down was from Sir John Layton when he came last year to give us evidence, and he described the role of the national galleries and other cultural organisations in Scotland as being mini ambassadors for Scottish culture. My question was going to be along the lines of how you see the impact of the current settlements impacting on the international standing of Scotland, but also closer to home with regard to HES and the work that you do across Scotland, and how you can ensure that the reopening of buildings involves communities. As my colleague Alasdair Allan talked about, it was the timetable of that. I will be interested here, Donald Smith, since you raised it initially about the international side of this. I know that the committee has considered that in other sessions, but in a post-Brexit world, the culture and, in its broadest sense, including heritage and culture is an integral part of culture has become critically important to Scotland's standing. We can look at that in terms of intellectual, academic or cultural, but that has the impact on tourism as well. I think that one of the things that has to be remembered is that the culture sector in its broadest sense is a platform for innovation. In my own festivals area, we have literary festivals, we have the science festival, including festivals in Edinburgh, and it is an arena of ideas and of innovation. At the end of the day, one of the questions that the committee has to keep asking itself and asking the Government is what kind of image, what kind of Scotland are we projecting internationally? I would argue that that has become more important than ever. I know that it is in the thinking of the big organisations about that international aspect, but there is a resources issue around that. We cannot do creative Europe, which, to my mind, was a bizarre decision. We cannot do Erasmus, so there is a funding issue there where we have lost funding that we previously performed disproportionately well in Scottish terms. There is the whole trading and customs issue, and there are visas. You are all familiar with that, but the conclusion of that is that this is not the moment for Scotland in its international standing to let slip on culture, because I would say that it is central to people's perceptions of Scotland, institutionally, diplomatically, personally and in family terms. We just do not want to lose that strong position that we have had in those regard, and there are these extra challenges. I know that the work that you do involves international artists, as well as the whole thing that Donald touched on there, and Alex, about the fact that you have heritage, but you also have culture that is moving forward. Again, from an international perspective, how are you going to be impacted? The greatest pleasure in the role that I have now, and in over 20 years' previous career as a journalist writing about the visual arts in Scotland, is the incredible impact of Scottish visual artists, visual artists who have lived or trained overseas. Artists from Scotland are known from New York to Beijing, and they are telling a story of Scotland, they are telling a story of modern, innovative Scotland, and they are telling often difficult stories, important stories. One of the greatest joys of last year, for example, was attending the Venice Bien Allee, which is a huge international focus, the most important international forum for visual art. To see the Scottish Barbadian artist, Alberto Whittle, who will be showing at the national galleries in April, showing in the context of her international peers and talking about many of the things that the Scottish Government is asking us to address every day around legacies, for example, of slavery and colonialism in Scotland. Having those really powerful, difficult conversations amongst international peers is the kind of Scotland that we want to be and that we need to be. The organisations that I have been talking about, even on really tiny scales, like four people in Huntley, are working internationally all the time. For example, at Devrin Arts, we are seeing artists from East Africa, for example, living and working in partnership in Huntley, a gallery like the fruit market that I have already mentioned, constantly co-commissioning with international artists, building international partnerships. That is absolutely vital. We really do know the impact of Brexit. It has been astonishingly severe. This is around the movement of goods. It is around the ability to export. It is around markets for small makers. It is around the costs of attending international art fairs and exhibitions. There is no significant initiative to replace any of this lost work. One of the things that we have called for for some time through cross-sectoral bodies such as culture counts is for an office of international exchange that could support this kind of working across the cultural sector. It is the absolute lifeblood of culture as those international conversations are vital. They are really at this moment in our history in Scotland to lose this. It would be a critical failure. John, since I quoted you at the start of my question, you highlighted the fact that you can loan out pieces of work from Dumfries to Shetland, but you were concerned that that might be impacted as well. I think that both Donald and Moira have articulated the dangers and risks extremely well. If there is one thing that Scotland wants to be known for across the world, it is for our culture, our heritage, our arts. It is an RDNA, a really rich, vibrant culture across all sectors, grass roots, local, regional, national and international. That is what we do. That is why we are really good at it and why we are jeopardising that. There is huge interest, as Moira has articulated so well. There is huge interest abroad in Scottish art and Scottish culture. We work internationally to bring all kinds of visual arts abroad, whether it is the old masters or the Scottish historical, as well as the contemporary. To use that phrase, it is an ambassador, but it is also a platform for all kinds of further and deeper interests in Scotland. Culture paves the way for other types of interests, whether it is economic or commercial. I think that it is extremely important, but there is a, I suppose, getting back to the nub of it. I think that the frustration that you are hearing and you have heard articulated by many people in different hearings is that you are seeing the impact of what, if you turn the dial a little bit negatively, the huge impact that that is having right across this sector, you have heard that very forcefully. Of course, the reverse is true, that if you turn that dial just a little bit the other way and invest, that too has a huge impact. One of the things that has concerned me in listening to sessions like this and the sessions with round table discussions, which have been organised to discuss crisis, is that we are being sucked into a resonance that culture is somehow a problem, that culture is a problem to be solved. Where it is not, culture is the answer, it is a solution, it is an asset to be exploited. And two of the words that have been used already this morning are investment and confidence. It does not require bold or radical decisions to turn that dial just a little bit. It is nothing bold or radical about that. It is a sensible decision to invest that little bit more to have that huge impact and to unlock those benefits across so many different areas of life. That includes, to get back to your question, the international working and the international standing. What it does for us if we are seen to be proud, confident, bold and investing in our cultural life, that is what it is about. Alex, I will go back to opening up. Just very quickly on international, I think that we know that the reset was done again pre Covid over half of the international visitors who come to Scotland have on their list of reasons to come visiting a cultural heritage venue or experience, so there is that important international mention. Of course, when you look at how we market Scotland across the world, cultural heritage is a fundamental part of it, so that is important. Flipped side of it is the international visitors. We have seen through our state this year a big increase in international visitors coming by, particularly from North America but elsewhere as well, nothing from the Far East particularly, but international works both ways. It attracts people here and it is an important part of how Scotland positions itself and markets itself around the world. On reopening sites and the involvement of communities, I would say two things in response to that. One is that over the last 18 months or so we have reshaped the organisation and out on the ground you will now find regional heads for the north, south and central in Edinburgh. We spent a lot of time coming up with those geographies, but they make sense. We now have a figurehead who leads for us in each of these regions, but underneath each of those regions we have put in place visitor and community managers. The community bit is really important because their role is to engage with the communities in which our sites are located. That is an investment that we have made in that engagement. Beyond that, one of the things that I have been doing, particularly around the high-level masonry, is getting out and talking to partners and stakeholders. Wherever it has been, Llythgo, Dunblane, following our last conversation, we have been up there and I think that that has moved on down Dumfriesshire, in Dunbarton, East Lothian next week. It is all about engaging with the local politicians and the local stakeholders to say how can we work together. If a site is reopening like Dunbarton, that is great because we can talk about how we work together with the local authority, the football club and so on, to make the whole offer better. At an earlier stage, like the Llythgo, the conversation was that if we have access restrictions at the palace, how can we work together with the museum and others to make sure that they are joined up offer there? There is a whole range of things that we are trying to do at engaging local communities, including putting more investment into our teams to engage with those local communities. The final thing that I would say is that it is not always just about where we have sites or about the sites. For example, we have a number of junior guide programmes that we supported. Yesterday, we announced a new learning programme that is about a site around creative collaborative work with organisations down in the Dunfriesshire area and a whole range of educational learning and engagement type activities. I said that the long answer to your question, but engagement with communities will be a higher priority given the resource that we have put into it. Particularly around sites where we have restrictions, engaging, explaining and looking at opportunities with the local communities is absolutely what we are engaged in. I am looking forward to going to three of the sites that are in Argyll and Bute, which are on the high maintenance site. Mr Shen, do you want to go in? To answer the question regarding the importance of ambassadors, if that is all right, I can follow on from that, but that is okay. One of the things that I want to reiterate on following from Mr John's point is the exponential effect that the investment can have. Some of the ambassadors are advertisements for people to come to Scotland and people to invest in it. Artists are the best ambassadors for that, mainly because of the fact that they have the opportunity to reach places that any of your advertising campaigns about Visit Scotland cannot reach. They will be on international TV programmes and they will be ambassadors across the world. They are also very vocal and can be both positive and negative at points, but I do think that it is important that showing the support to them and showing the investment in that can have such a massive effect. A small investment, you look at some of the current artists that are currently from the music world that are out there and whether they are vocal or not. I look at artists like Lewis Capaldi who have got reach on a massive international basis. Being able to get that message out there that art is important in Scotland is amazingly important. We know that there is a lot of international tourism that is based around music and art and that it is bringing people to this country, but it is more than that. It is also the fact that these people are prone to how wonderful Scotland is for Scottish culture and Scottish life and bring further investment into the country. That has done a very low cost to Scottish Government. As I mentioned, the advertising budget for tourism is quite large and is a very important part of it. Small investments in artists like that and the organisations that support them and create them are amazingly important and can have a much bigger exponential effect. It is very hard to quantify, I think, the most difficult thing for it. We cannot really say what the benefit of that is, but one of the biggest concerns is that we see that although there is a lot of talk about how wonderful and amazing culture is in Scotland, it feels as though the Scottish Government is almost penalising it compared to other countries. There is a lower spend compared to many European countries and across the UK. It is important that, in order to get those ambassadors and to have them to have a positive conversation about Scotland, we need to invest in that. I have two areas of questions. The first is principally for Mr Paterson and Sir John, who have both spoken about a more positive budgetary position than expected. I suppose that my question is given that more positive picture. What do you see that enabling you to do? Do you see it enabling you to open more sites if you are HVS, perhaps reverse the closure of the modern two gallery, turn the dial a little, invest, expand, whatever it might be, or is it more a case of just batting down the hatches and being able to balance your budget? I am just quite keen to understand where the additional funding goes. I will start with Sir John and then Sir Paterson. Thank you. It is a very good question. It is very much the latter in that I would describe it as a potential year-long breathing space. As I said at the beginning, instead of having to somehow deal with a huge deficit, I cannot see a way to balance. Of course, as we have also talked about at this committee, organisations like the national collections, like Historic Environment Scotland, have to think across many years. We develop skills, knowledge, expertise that has to be nurtured across years. We have programmes and projects that have to be nurtured across many years. Short-term funding cycles are very difficult to manage. I think that the short answer to the question is that it allows us time to see how patterns of visitor behaviour will settle. Suddenly, there has been an increase last year, will that continue? On average, around about 70 per cent, 75 per cent of pre-COVID levels, will that continue with the associated income? It allows us also to look at other operating models, levels of activity, levels of programme and see other things that we need to stop doing in future years or do in different ways or do in partnership, etc. I would say that it is a breathing space. Without a perspective of what happens 24, 25, 26, it is very hard to predict, but the messaging that we are getting is to prepare for harder times. That is what we are doing. Just before I turn to Mr Paterson, I take it that you have not changed your view on multi-year funding that you expressed to the committee in September. It is highly desirable, but not in sight at the moment, as far as I can see. I can appreciate the difficulties and uncertainties that the Government has to deal with. I know that the cabinet secretary expressed the strong desire to do it, but we are in the position of now having a budget that will be finalised shortly for a financial year that begins at 1 April. It is harder to imagine shorter-term cycles of funding. I will pick up on your point about modern 2. The closure of modern 2 was always temporary. The draft budget, if approved, would allow us to reopen modern 2 and hope to make an announcement about that very soon. I would echo John's comments about multi-year budgeting. The reality is that, as John said, we commit budgets over multiple years because a lot of the projects that we do, a lot of the organisation that we support through grants, are multi-year commitments. Even if we do not know what our budget is, we are making commitments. The more visibility you have in terms of multi-year funding, the better. The resource spending review, the capital spending review, early this year or last year, was helpful in giving some indicative figures, but that makes sense. A couple of other comments in relation to your question. One, yes, I did say that we are pleased with the setum that we have through grant and aid. Of course, the flipside is that we carry a risk on the commercial side of things, but if we can realise the commercial income alongside the grant and aid, then a few things are possible. I caveat all of that by saying that our board has not yet met to agree how we allocate our budget, but there are two or three things. One is that it allows us to continue with the vast array of things that we do. Most people associate us with castles and standing stones, but we are a regulator and we do a whole range of other learning and outreach activities. It allows us to continue with a lot of the things that we have in train. What might we be able to do over and above that? I would say three things. One, bear in mind that we all carry increased costs. The pay award, which I am delighted with, we were able to put in place, added an extra couple of million over what we anticipated based on the pay policy this time last year. Our energy costs will probably go up by 88 per cent, as I figure in my director of finance gave me yesterday, so we need to increase the income to cover the cost. However, we will be looking to make additional investments into our estate. That is into the fabric of the estate. It is into the visitor experience, the visitor infrastructure estate, because that is fundamental. The investment in decarbonising the state, the climate agenda that is really important to us, and the final element where we will probably put more funds into our grants programme. We reluctantly reduced the grants programme through Covid, because grants is a component part of our overall funding. That took a major hit. We maintained grants at a very high level, but we had to reduce them. Our aspiration would be to get our grants programme back to pre-Covid level. We can make all the top-level income work, particularly on the commercial side of things, continuing with the range of activity, but probably prioritising more into our estate, trying to enhance the grants programme and covering the fixed costs that are increased before we turn the key in a lock anywhere. My second error question is to return to the points made at the very start of the session, principally by Ian and Moira. That is to address the cuts that are being implemented. I think that it is of 10 per cent to Creative Scotland, which is around £7 million. Ian, you spoke about it at a standstill level that puts a quarter of your RFOs at risk. If the cuts were to endure, you suggested that around half of your RFOs would be in grave danger. I suppose that what I am interested in is what conversations are you having with your RFOs and the organisations that many of you represent here. What anxieties are they telling you that you feel that you should perhaps pass on to us? I am sorry to say that my understanding is correct. Even on standstill, just because of the cost pressures, there is no standstill funding. It is a material cut. Our estimate is that that is between 20 and 30 per cent in real terms, which is why at least a quarter, up to a third potentially of the current 120 RFOs are at risk in the immediate months ahead, should nothing else change. We have achieved standstill by backfilling the Government cut through national lottery reserves as a one-off. Without those national lottery reserves on the basis that those cuts endure, you are right. I think that there is a risk to half of the current RFOs as a minimum, but there are many more hundreds of organisations beyond their seeking multi-year funding that also want to make a case and rightly should be given the opportunity to, but we will not have the budget to respond. There is no commitment to anybody beyond 23 or 24 at the moment, as far as the RFO is concerned, and long-term planning on multi-year budgets is a fundamental point. People have worked really hard over recent years, particularly through the pandemic, to sustain their operations, their activities, their programmes that touch the lives of so many people in different communities across the country. They are in many ways exhausted, but what I am hearing is despondency and disaffection with the very clear public statements of support by the Scottish Government of the extent to which culture and creativity are valued in the country and the stark reality compared with how that is translating into the budgets. They are worried about the future, but they are, as Donald mentioned earlier on, are inventive. To pick up with John's point a wee while ago, the extent to which I have said before that our budget is 0.1 per cent of the Scottish Government budget is tiny in terms of the value that it ultimately delivers. Disinvesting in that leads to a lack of confidence. That lack of confidence sees the risks that I have talked about in terms of the reductions to the sector, but it also holds below the water line. The engine of creativity that comes from art and artist into the future would see the cultural sector thrive. I think that shifting the dial, as John was talking about, in the opposite direction, is not enormous amounts of money in terms of the overall Scottish Government budgets. I absolutely accept finite resources, but the value that is already delivered and at now at risk could be reversed with an adjustment in the opposite direction. It would unlock confidence, it would unlock in an exponential way so many different benefits culturally and socially, as well as economically. It feels like we are about to go beyond the tipping point. When much of the reduction that I am talking about is to take place, it could be a retrievable. There is an awful lot at stake in terms of the realities of what are yes significant sums of money, but relative to the whole, small and with just some adjustments that could unlock an enormous return on that. That would bring confidence back to the inventiveness and innovation that would come back. It would ensure that we have a thriving cultural sector. One final point, if I can connect it back to the international point, is fundamentally important. It remains as one of our four priority areas. It is part of creating the conditions for a thriving culture in Scotland. We do not get any direct resourcing from the Scottish Government for this, by the way, but the news of our cut, when it broke for Christmas since then, I have had many of my international network contact me with astonishment about the implications of that. They understand immediately and it is partly because we have such a strong international and internationally confident reputation. That, too, is at risk in the current financial equation. Really to follow on from what Ian has said when he is talking in those numbers about potential loss, those anxieties are simply existential. I think really to follow on around the question about international benchmarks and the scale of cultural funding in Government spend and the ability to reap havoc, but reap very little reward from those cuts, but strategically that does not make sense to me. Beyond that, I guess the anxieties that my members are showing is beyond this group of RFOs, those organisations that are waiting in the wings, who have been building up their skills and resources and who are ready to step up to the next level. The pipeline for future employment and, in particular, a huge concern for young people. At the core of all of this, we are nothing without our artists as a sector. That is what we are here for. We surveyed our members in the autumn around the cost crisis. This is not just about the announcement of the budget cut, but about the impact of the cross-crisis. One quarter of artists and freelancers who responded had already been forced to seek additional work. 40 per cent told us that, if help was not coming, they would seek work outside the culture sector. Those anxieties are huge, but, to reiterate what Sir John has said, they are easily fixable. They are not huge amounts of money in order to invest in support appropriately. We can do this. I just wanted, if possible, to give an idea of a case study just to support this, which is that, as a charity music venue trust, we have identified one of the key issues that we have with venues is infrastructure. 93 per cent of all venues are owned by commercial landlords, the actual physical bricks and mortar. As a result of that, we had installed a programme called own our venues, which is an investment opportunity for anyone through community benefit shares to invest and raise money to buy these properties so that we can then offer fair rents and basically stop money that is going to commercial landlords to be reinvested into the sector. The reason I raised this is because the fact that when we have looked at this in England and had conversations with DCMS and Arts Council have been able to supply investment and they have just invested £500 million into this scheme, which was the core bit of it, was to raise £3.5 million. Similarly, again, we have been able to have conversations with Creative Wales as a result of that and they are looking to invest in it. One of my key things was to have conversations with Creative Scotland to be able to do this, but we are very much aware that from the conversations that we have seen before and from the conversations that we have had today, it is very difficult to go to someone, a funding body, with a new development plan like that and say that this is a solution because the fact that they are with cuts like this, they are in a point where they are going, well, that is lovely, we would love to do that, but we are having to really focus on making sure that what we are doing at the moment is available and so we are really aware of them having those discussions. What I would say is that a project like that, when we announced the £500 million investment from Arts Council England, then meant that all of the investors who had previously invested in it and our new investors came in and went, well, we will invest with that, and this is one of the things we really, is that funding is not just there to do things by itself, but it encourages other investment and that is one of the key things and that brings further investment into the countries, into the infrastructure. As I say, from a case study for ourselves, we have great concern about whether or not we could go to Creative Scotland and go to the Government and say, well, we would like you to invest in this project just because the message at the moment is, well, we are making cuts, and I think it is important that that is reversed. As John Innes said, it is only a small change the other way to make these organisations be able to say, no, we want to take risks, we want to improve, we want to make things better for artists across the country and just return on what Moria has said. This is a culture and an area sector where it is not easy to replace people and that is at all levels. Whether it is organisations at the high level where people have been invested and have had a big background and worked in the structure for 30-odd years, we have just gone through a pandemic where people have started to have to move to other areas to come out of that and then be told that funding is going to be cut, that actually investment, and whether it is funding, as I say, or just investment in general in culture, that there is a view that that is not important really is kind of the straw that race comes back and makes people want to move to other areas. Unlike other industries, they are not replaced easily at all. We need to inspire more people to want to work in this area and to be told that it is not important. From a funding point of view, it just makes people go, well, I will go and get a job elsewhere. That is just a case study from what we are looking at. I have found that the various case studies that we mentioned today are really helpful. Can I finally tend to Donald Teele to add anything to that? I run an RFO. I am a case study. We have an international festival, we have a venue and we have projects and networks running in every local authority in Scotland. You then sit and, how are we going to get through the next year? Our two biggest areas of expenditure are staff and direct support to artists and local creative groups. Those are the two big. We also are trying to look at how we can maximise things like other sources of project funding. We have benefited from the culture collective programme, which has been another success story in culture investing directly in locally led community projects. That is Scottish Government money that has not come from the culture budget from elsewhere, as far as I understand it. We will keep trying to keep that local support model going. We will have to lose staff. That is the only way to get through this. I suppose that the worry and looking ahead in that is how do you recruit and attract, and Moira's point about young, the next generations of staff, the next generations of artists, if there is a kind of hand of doom atmosphere brooding over the whole damn thing. We are just a wee bit in danger of slipping into that at the moment. I shift the dial, seems to me, the catchphrase of this session. We need a positive trajectory. We are adaptable, we are resourceful, but to create the future that we want for our society, not for some removed arts thing, for our society, for Scotland, we need to have a positive trajectory. At the moment, I cannot see it. You have a sympathetic audience in this committee about the fact that you need, as you have just said, a positive trajectory in terms of funding. I thought that the only rider to that would be, and it is not meant to take away from what you have said, that the Scottish Government could probably do with a positive trajectory too, and probably some notice or say over what its income is. Everything that you have said rings true, and I suppose that where it leaves us, given those constraints, is cross-portfolio working. The committee has asked about this many times, not just to the culture sector, but to other parts of government as well. This is one for everyone to chip in on. How do we make this thing that we talk about all the time real cross-portfolio working? We have often talked in this committee about things like social prescribing, cultural prescribing, but you quite rightly pointed out that this is supplementary to your budget. The health boards tell us that it is also supplementary to their budget. I do not know what the answer is, but I genuinely would be keen to hear from people how we make this a reality, because we have talked about it many times. It is clear from the pilot studies that have been done around the country that the health service and society more generally could save money, could be healthier and happier if we were doing more of this, but how in those difficult circumstances do we do it? It is an important, on-going concern to make sure that we can unlock all those opportunities. They are already in existence in certain quarters, and I think that we should recognise that. It is just how they become embedded more fulsomly across the public sector landscape. We are not coming from a standing start. All the evidence is there about the effectiveness of this work. My view on this is that I do engage in cross-portfolio conversations. I am sure that they are happening, as the cabinet secretary has also said. Ultimately, we can embark on negotiations, but everybody is in the same constrained environment and becomes protective of their own agenda. It takes more radical thinking to go beyond that, to understand how you can unlock those opportunities. Ultimately, that can only be unlocked through political direction at the highest level and agreements that have been achieved at the cabinet level about pursuing those opportunities. As I said, we are all very committed to enabling cross-portfolio conversations to happen, but at the moment they are happening on a very slow burn and are not going to release resources in the short term. However, they have an important role to play in the make-up of the value of the work of the culture sector. Ultimately, stronger political leadership to unblock some of the challenges in those negotiations would ultimately determine it. If I can give you one illustration of that, which is Screen Scotland, that has become an enormous success story. Even in those challenging times, yes, there is a kind of fortunate set of conditions around streaming platforms and so on, but ultimately Screen Scotland came about through a combination of political will and determination to make it happen, with the right people in Creative Scotland and Screen Scotland with all the expertise that they have got, being brought to bear, with modest pounds. It was less than £10 million, which has been applied alongside our national lottery funding for Screen, to unlock that opportunity. It is already, as per the published data last year, £1.5 billion in the strain Scotland. Yes, with a view to increasing that by 2030 to double that. The combination of the three Ps, political will and determination, the right people and the modest pounds has unlocked an enormous opportunity there. I can see that writ large across all other parts of the culture sector in the right conditions. Ultimately, political leadership is going to be a key part of unblocking that. As I said, that was for anyone to chip in on. That is what those roundtables are really for, for anyone else of a view in that rally. I will add another P to Ian's 3, just in a second. We have talked about mainstreaming a lot over many years. I am not sure that it gets much beyond the talking. That is part of the challenge. We also submit information as part of our reporting to Government, business cases to Government, on the key themes of climate change, child poverty and so on. I do not think that we can see the connection of how all of that is bringing together of what we all do around key themes. How does it feed through into the budgeting process? That seems to me to be the same sort of budgeting process that we have had for a long time. Three suggestions. One is a particular thing for the historic environment sector, which is we will have a new strategy for the historic environment sector ideally in April of this year. One of the things that we have tried to do as we have done the consultation on it is to make sure that we speak to lots of people outwith what might be normally defined as the historic environment sector. If we are going to grow the sector, it needs economic development agencies, skills agencies, funding councils and others to come together. I think that there is an opportunity around the new strategy. Under the current strategy, some of the working groups have been quite good at bringing together lots of different interests well beyond the sector to work on key things such as skills and climate and so on. My second suggestion is that, as new structures are put in place—at the moment, I am not as close to it as I used to be—there are proposals for new regional economic structures to be put in place. The sectors that we represent should be around the table in the new structures so that we are not a bow, taller and afterthought for all the reasons that we have all talked about, the contribution that we have made to lots of agendas outwith our narrow one, if you like, making sure that we are at all those tables. A new tourism industry group was set up recently. One of my directors is on it, but it took some effort. We need to get the operator of the biggest tourist attractions in Scotland to be on the national tourism leadership group. Ensuring that we are around the right tables, particularly regional economic structures that have been set up, is good. However, my additional P to add to Eons is that we need to continue advocating for the mainstreaming and how do we get cross-portfolio working, but we need to do some pilots and pick some geographic areas or pick one or two other ways of defining pilots and say, can we do it? We had one property that we were looking at recently where social prescribing, community engagement and all those things were potentially coming together into a project. There are others out there that that could be done. We need to do something. We need to run a couple or three pilots and see how it works and what it looks like and learn from them. That might take away the high hurdle that I think is often perceived about how the mainstream culture and heritage into all the other things demonstrate how it actually happens on the ground. I think that there are a few good communities around Scotland where we can do that. I think that it is key what Sir John said earlier that we need to look at culture as an opportunity. This is not a problem when we are talking about funding that needs to be done and it is a solution to so many problems across the country and across many different strategies and portfolios. I think that there does need to be more of the fact that we need to be in conversations with other areas, whether it is education, whether it is healthcare and there needs to be more representation from groups represented here today at those committee meetings as well. I think that that is a really key and important part of it. I think that one of the key things at the moment that we can focus on is education, because there is a real benefit there that can be brought into it. One of the things that I was most heartened up with a cross-party meeting group was the sheer amount of music education that goes on and the availability of that to youngsters across it. I think that one of the key challenges there is that it is viewed more as a pastime or a hobby. There is not a lot of around career development of getting people from taking what artistic performances are but also to look at the other areas of things around crew, around promoters, around running organisations and setting them up. There is not a lot of education that is done around that and there is also not a lot of career development that is put in place through and we find that most people that are involved in the arts at that level, particularly at a grassroots level, have not got a business background, have an artistic background or are involved and often fall into the business side of arts. I do think that there needs to be more conversations between culture and education particularly as to how that can benefit it. Also, the fact that a lot of these people are doing portfolio careers does mean that what we tend to find is that in the real world people are working in multiple areas. I know a number of people who are working in the arts bar are also working in education particularly in healthcare and I think that that thing of working at a local level enabling that kind of networking at a local level as well is really important. We often find the challenges that are local government levels getting creatives involved in other areas such as education. To be fair, even getting them involved in talking to local government about culture is very difficult but we do think that there should be more regional networks which then can have an impact on education in the city. My background is as a venue owner in York and we soon found that being able to get into those conversations at a local level and have venue owners and organisations and arts organisations talking to local government meant that actually they were able to say well actually we've got a problem in education where we want to involve children in we need spaces or we need and suddenly getting people involved at that level with local government means that those councillors and people involved at local government can say well actually we have problems in this area maybe these other sectors can be involved and help provide solutions so I think it's saying that it needs to look at regional and local government as well and I think that's going to be a key thing because that's where as you mentioned Don mentioned earlier a lot of arts investments and also other investment actually happens so more facilitation of regional networking for culture and cultural hubs is really important. Yeah just before I move on we had actually hosted the Scottish Youth Film Foundation here last night which started in Armadale working in schools there and it was a great example of of an organisation that's going on to and the development and the feed through into the arts people now working in that area was was quite profound so quite timely to have that last last night. Yeah Donald do you want to say a little? Good evening. So what's common to the the last couple of contributions is the importance of working from community base up and I think there's more cross-budget collaboration and co-operation actually going on in that level than we maybe realise and the central policy making is important to that because there's emphasis on sustainability and community place making and I think that culture's got a big contribution in that level and that that is beginning to happen and that's something we need to see how can we strategically support that you know the kind of more overall budget level and just on a specific within that as well we do sometimes speak about heritage and culture as being two different things but at local level the heritage and the cultural side absolutely belong together and I know that we've been reviewing and we as traditional arts and culture Scotland, historic environment Scotland are involved in this I've been looking at the whole area of intangible cultural heritage which is an internationally recognised category and there's a possibility that the UK might consider joining UNESCO convention on intangible cultural heritage and that's just you're looking at what is what are the assets of an area in terms of music and story and creative energy and all the rest of it and we're very rich in that in Scotland so I think we're back here to this thing there are huge positives that these kind of cross budget cross organisational working I believe is happening and will grow and therefore it's it's back to that positive trajectory that we're not snuffing out something that I I think is happening and could happen on a on a larger and very fruitful scale and when you do all that the other critical thing is citizen support there is huge public support for this kind of community-based and creative working and for creative opportunities for young people that that's a huge we're not talking about something here that's obscure and narrow and is only supported by a certain set of organisations and corporate bodies people want this people want this for their families and their kids for the future okay I think we need to move on to mr golden thank you thanks convener I just want to pick up around the topic of net zero and maybe start with alex paterson because you've mentioned in respect to some of your previous answers clearly net zero is going to remain a focus but given the budget settlement and particularly around the capital budget what progress are you likely to be able to make in this area particularly around the states and buildings I hope quite a lot I mean I think I wrote to the committee after we were last year with a range of things we were we were doing practical interventions we were doing ranging from improvements to the state to waste strategies to responsible tourism initiatives that we want to try and roll out so we want to continue doing that and it is a top priority for the organisation that we deliver our climate action plan I think that one of the things I said the last time and I'll say it again here because it's very relevant to this is that achieving the net zero ambitions for Scotland requires things to be done across the historic environment state so the whole reuse and retrofit of buildings making them energy efficiency making them energy efficient is vitally important and again as I said last time one of the key contributors to that is skills and we can't we're not going to achieve what we want to achieve as a nation in terms of our net zero aspirations without the skilled and people that would need to deliver these sort of things so my very basic example is we can improve the energy efficiency of historic properties but if the fabric of them is not right then you know you're compromising the energy efficiency so stone masonry traditional skills investing in those is critical and again said last time those things are a real challenge at the moment for the sector we've taken on the largest apprenticeship intake that I think we've ever taken on this year but there are challenges around the wider sector around stone masonry and other traditional skills and we're doing a bit of work on it just now with the view to trying to find a sustainable future so various aspects or dimensions to my answer we as an organisation hugely committed to to the net zero agenda as it manifests itself in various ways on the state where we can make investments that deliver that we will do it the most recent one was solar panels at Edinburgh castle but our team are working on other interventions across across the country but beyond that how do we back to the mainstreaming point how do we get the message out there that you know reuse and retrofitting of historic properties with the right skilled tradesmen to do the work and improving energy efficiency that's a huge contribution to the national aspirations for net zero thanks sir john did you want to come in on this as well thank you yes well like historic environment in scotland we're also completely and hugely committed to the path to net zero and as the the guardian of five grade a historic buildings we we have still some work to do to make those as energy efficient as possible so and I think I touched on this at the last hearing I think the three things that would be part of our planning would be what we do with our own infrastructure and estates and how we make that as efficient as possible what we have to do secondly then to protect the collection in the future from the effects of climate change which we're already seeing quite dramatically and how we operate as a as an organization to minimize our impact on the environment thinking about travel international loans and so on and a project related to that which is very important to us is the project to create a new collections facility in north Edinburgh which would do away with the need for a number of really inefficient stores but but create a new hub built to pacify standards that would allow us to look after the collection properly but also to distribute it both locally nationally and internationally in efficient ways and then a third strand which I think is also incredibly important is how we in our programming introduce and raise awareness of issues relating to climate change and I think I used the phrase the last time that artists are in some ways the canaries in the coal mine of society and many artists particularly contemporary artists feel extremely strongly on very engaged with issues to do with climate change and providing a platform for them I think helps generally in the whole construction of arguments and raising awareness across society about the urgency for for action so there's in in short some of the the key factors of our planning ahead thank you thanks that's very useful I don't know Chris I want to raise one thing which is that whilst there is a massive commitment in the grassroots music sector to doing that and many operators are doing things in the ways that they can say about recycling and around uses of materials the biggest challenge that we have is ownership of the infrastructure as I mentioned earlier 93 per cent of the venues are not owned by the people that operate them or are owned by just commercial landlords and so the challenge there is that they're not able to make changes whether or not they want to put better insulation in or improve this by or even add so the panels look at other energy challenges they do not have the opportunity to do that and that's something that is very much aimed just at the grassroots music sector because they say I think one of the biggest challenges here is that not everything works for all areas of culture because we have decided different operations to other areas and that's why we say we're looking at support for being able to purchase those spaces and we're not looking at the fact that we're looking at investment we're not looking at kind of overall just purchases of all and safeguarding of all these venues we are looking at being done a responsible community led way and so I think further support for that whether it's through actual funds or through helping with the mechanism of being able to move these venues from commercial ownership into a more community based scheme would be better one of the challenges we're seeing around that we've had previously worked around asset of community value which has had some success but in general honestly it's not very easy to implement one of the things that would be good to look at in the future is being able to look at compulsory purchasing and ways in which that we can recognise these cultural sites because one of the biggest challenges we find is that venues last for five ten years and then are lost and for many of these spaces it's very difficult to find spaces that are suitable for performances like this so we are really concerned that once we lose these venues we won't be able to replicate them we haven't seen a new grassroots music venue being built for many a year so it's quite important that we look at that and it allows then these venues who are very much driven to make these changes to come as usual to be able to look at that so that's one of the biggest challenges we find at the moment. Thanks for that, yes. Just to say a practical point a lot of arts venues in Scotland are not energy efficient and need investment to get up to the whole carbon revulsion agenda. If you take money out of the arts lottery funds to prop up revenue funds to keep for organisational grants you're actually depleting what is probably one of the key potential sources for investment in improving the arts infrastructure environmentally. Thank you. Last Q9 took a group of artists to the SCVO's annual gathering. We took three artists to meet. I think it was about 50 charitable organisations who were working in the area of carbon reduction and net zero. Those three artists demonstrated to the potential partners just the way that they're leading the conversation. We had artists who were working on articulating the amazing resource that we have in Scotland's own rainforest in Argyll. We had a curator from Oban who was talking about the imperative in a kind of beautiful landscape of Oban. It's quite often difficult to understand and articulate the climate crisis. It seems it's damp, it's beautiful, it's green. How do you articulate those issues? The curator there was building a coalition of local organisations to have that conversation. Then we had an internationally renowned artist, Robin Wilson, who was talking about the work that she was doing. For example, she's based in the highlands, but she was working in Texas talking about the oil economy and showing a major exhibition at the University of Texas. Artists are really leading those conversations. Investment in artists is investment in that. Canary in the coal mine is exactly the phrase that I was going to use, so John got there first. That's really critical. For members who are organisations, many of them are working in found buildings, in historic spaces, in heritage buildings, talked about people working in town centres, for example, where they're taking over buildings that have fallen out of use. Those organisations are desperate for support for carbon adaptation. Part of the conditions of funding from Creative Scotland are that organisations are carbon monitoring, they're committed to carbon reduction. Every year we fill in a form to say how much we're reducing our waste. We're doing this work, but it is going to require support around buildings. That's not reaching us. There are no clear mechanisms for us. Artists themselves and organisations generally lead low-carbon lifestyles. I'm often saying that one of the ways that you can really support artists is through, for example, active and sustainable travel. I work in a building where we've invested—the landlord wasps has invested in cycling facilities. We can do it and we are doing it. The culture is at the vanguard of this conversation, but it desperately needs the support around capital adaptation. Thanks for that. Ian, would you like to come in? Thank you. I mean, it's just to reinforce a few points. If I may, Creative Scotland and the sector is very committed to this agenda in the way that you've just been hearing about. Last year we published our climate emergency and sustainability plan, which is drawing on 10 years' worth of work that we've been doing where we can have picked all the low-hanging fruit and is intended to now move us on because the strength of feeling around this agenda is very strong in terms of the commitment that we and the sector have got. In that plan, there's a combination of things that we'll be doing, some of which is about how we can look at carbon budgets, how we can look at funding criteria, how we can look at practical support. However, the adaptation point is a critical one within it, and it's very under resourced at the moment. It will be key to achieving that path to net zero for the cultural sector. In summary, for us, this has three layers to it. There's what we do as an organisation in our own carbon management and climate sustainability. There's what we then can translate into the second layer, which is the organisations and the people that we support in the work that they do and how they do it. The third is an important one to recognise, which is the work of those artists, the work of those cultural organisations, go on then through the work that they do to inspire and influence and inform and change behaviours around this whole agenda. There's a ripple effect there about taking care of the hard nuts and bolts, but the softer dimension to it, which is about how it informs and influences public opinion and behaviours, is a really important one to not lose sight of. Yet again, we'll need investment to be able to achieve that. I think that this has been an excellent discussion. I took out of our last session the phrase, the perfect storm and the challenge of keeping the doors open and the lights on. Today I'm taking culture and heritage as in our DNA, but we need to avoid the culture of doom. Is there a need for us to have rescue plans for organisations, given the cuts that you've been talking about from the very start of today, to keep organisations viable? I'll give the example of Filmhouse. Nobody saw that coming. It came as a total shock. The organisation totally went into administration. There's no space for a potential rescue plan. There are still discussions, but the minute you're in administration, that's a very different trajectory. It's much easier to save a project than to deal with the wider negative impacts of loss because everybody's talked about the benefits of culture. Is there something that we need to do in terms of a crisis plan so that we can get wider cross-government support? In the Filmhouse, you potentially lose to cinemas massive impact on the Film Festival in Edinburgh, international film festival, jobs, economy, culture and education. We deal with crisis, but here we're potentially walking into crisis. Is there something that we need to do now to ask for government support coming out of cuts? You either sort the cuts, but from what you've talked about earlier, particularly in the opening contributions, we're moving into a very difficult position for many, many organisations right across Scotland. I'm looking at you and sorry, because we started off with you. You've got the big cuts coming up. Indeed. I'll go back to a couple of points that I made initially on this. I think that this is borne out of systemic underinvestment in the sector for many, many years. We're now about to go beyond the tipping point. When things are gone, they're gone, as you've said, and it's very hard to recover from that. It's much better to take a strategic approach that seeks to manage that with everybody involved, whatever the budget situation. As we've noted before, for just a little bit more, you could reverse the prospects and fortunes of all that we've been talking about here by way of negative outcomes. The positive contribution that the sector makes is enormous and understood. We need to unlock that opportunity. Our ability to navigate that has now been severely curtailed by us having to use national lottery reserves to offset the cut. Those national lottery reserves will be part of us helping to manage that strategic context to a different outcome than the one that we're currently facing. I haven't used them for the cuts. It's no longer available to be used for those purposes. Where do we afford it from? I think that people are at risk in the immediate short term. We have no financial flexibility. There are no financial safety nets in place to be able to address those potential outcomes. That's why I said at the outset that I'm very concerned about the short and the medium and the long-term future here. I don't think that this is at all about a recovery agenda, this is about survival. The energy and focus from, as I mentioned earlier, an already exhausted sector being turning their attention to survival is energy that is not being channeled into creative output and creative work that delivers all the positive benefits and value that we know. I am struggling at the moment to see beyond trying to bring people together for practical conversations. I can actually oil the wheels of change that is going to be necessary to understand how we can take ourselves towards a more confident future and take control of that rather than let it happen by default. There are 11 months until there will be a new Scottish budget. I support Sarah Boyack's point that I think that Grace of Scotland needs to lead on coming up with some kind of rescue plan for the art sector, which takes into account the difficulties that are being faced, the severe risks that are being faced, but perhaps we have just that window of 10 or 11 months to get a handle on the specifics of that and to present a case to the next. The interim period is where we are at, but we have to use this time to try and look forward in a tough but hopeful that we can take a core base through this next very difficult period and make sure that all the positives that we have discussed are held on to. I hope that the committee will not go away from the meeting on the presumption that there is nothing to be done. I think that we have to get our sleeves rolled up to get an exact dimension in this and see what the potential for getting through it and potentially shifting the dial is. I think that that was maybe what was behind Sarah Boyack's question. I am not sure. This is about money, but it is clearly also about strategic leadership. Our organisations, our artists are hitting all the aspirations of the cultural strategy. They are working doubly hard under challenging circumstances and at the moment it feels that they are operating in a strategic vacuum. There is a lack of clarity about who would be saved, why they would be saved, because they are meeting all those outcomes across the performance framework and they are performing extraordinarily well under really difficult circumstances. There needs to be a plan and there needs to be a clear sense of strategic vision for the future. I think that one of the key things that Sarah Boyack mentioned was when she said that no beast saw that coming for that particular organisation. That is one of the challenges that we have identified. Particularly with a lot of our organisations being commercial and not charities and not having reserves in place, is that they need to have a support structure to be able to tell people that they are in trouble. One of the major issues that we have had as a charity that has just become registered in Scotland is that we have been unable to support a lot of members because the fact that we are unable to get funding for co-ordinators to be representatives of these venues and be able to talk to it is one of the reasons why I am here today, rather than having a Scottish co-ordinator in my charities, because we currently are not able to put that in place. I think that is one of the key things is that we need to be able to support organisations to also bring up what is going on at the grassroots level and at any of these arts organisations to be able to bring that to Governments. That is one thing that we need. It does not take a lot of investments to do that. One of the key issues that we have there is that we, again, unfortunately Scotland compared to the other nations in the UK, are not able to be represented. We have co-ordinators ring and we have them in place, which is what Wales has had, and that is just mainly down to funding. That is not just, again, not just looking at Government but also investment from other areas and investment from the sector. I think that that is key and important. One of the things that I mentioned previously is that it is also for those venues and for those organisations is being able to say, look, what can we not pay at the moment? We are very aware that we are in a tough situation. How can we reduce those costs down? I mentioned earlier that it is a bit about the business rates and that is our major challenge because it is something that is just for our sector compared to the rest of the culture, really, due to the way that a lot of our organisations are done, but the cost of that, and in order to make that £1 million back in ticket prices, it is going to be £5 million, because of the fact that in order to make that money back, we have other costs. If we were to make it back from hospitality sales and from retail sales, it would be £3.5 million, whereas it is just easy to say, well, do not pay that £1 million. Whether that is done at a national level or whether it is support that is given to local authorities, we mentioned earlier that local authorities are key to culture in their areas and they know exactly what is going on. Give them more discretionary powers to be able to say, well, look, we understand that you are not able to afford this cost at this point in time, but you will be able to next year, so let us not pay that for the moment. Being able to give more discretionary powers to authorities is key to that, because they will be able to identify. We are aware that some venues can afford to pay these things. Some venues are in decent situations and there needs to be more discretionary power given to local authorities around that and being able to offer relief against some of those costs. It is not just about funding and giving out money to public funding, it is about making it easier for organisations to not have to pay as much for the other things as well. I think that there needs to be more interaction so that we do know in advance. One of the key things, I think a lot of organisations at the moment are so busy fighting fires that they do not have time to ask for help. I mentioned the fund that we set up. It is £5,000 in money to venues, which is a 12-question application form. I would have thought that every venue in the country would be biting our hands off to get some money, and yet we are still finding that venues are struggling to find the time, because they are too busy fighting fires. We want to give people as well time. That has happened through creative networks, where people are supported to realise that instead of just dealing with the day-to-day of what is going on, they need to focus on the future and they need to be given that time and the opportunity to do that. I hope that that will happen. I think that that may have exhausted questions and contributions for today. I thank everyone. It has been a really important and interesting session to have had prior to the budget. Next week, we will have the cabinet secretary in front of us on the budget. The Swedish ambassador is coming on the priorities of the presidency of the council of the EU. On that note, I will close this meeting.