How will theatre survive in a post-subsidy world?

In his 2017 Philip Parsons Lecture at Belvoir, award-winning lighting designer Nick Schlieper asks: how can we turn the anti-subsidy trend around?
How will theatre survive in a post-subsidy world?

Nick Schlieper. Photo by Lisa Tomasetti.

This is an edited version of Nick Schliper's Philip Parsons Lecture, 'Where to next? When subsidy subsides...' presented at Belvoir on Monday 20 November. 

We missed the bus.

Subsidised theatre stopped being subsidised and we didn’t really notice. To the point where we now need to find a new term for it.

‘Not for profit’ unfortunately sounds a bit like a charity, but if we’re not careful, then that’s exactly what we’ll be.


A worthy cause. To be patronised. Occasionally and only when it suits.

We didn’t look the other way, as that implies an active decision, a choice. We’ve just never been a very politically engaged bunch. We tend to be too busy making theatre and simply surviving, to have time, energy or inclination to step back and ponder the bigger picture.

I don’t intend to offer any grand solutions – would that it were so easy. Rather, I hope to provoke a conversation, because if we don’t start talking about this really bloody soon, then we’ll miss the bus again, in which case I can’t help but be very pessimistic about the future of what we think of as subsidised, or let’s call it non-commercial, theatre in this country. Because the reality is that we are approaching the post-subsidy age – arguably, we’ve embarked on it already and if we, as theatre makers, don’t start talking about this amongst ourselves, then we’ll be in even less of a position to influence the shape of our companies in the future.

Governments are quick to claim that subsidy levels have not fallen. That’s not true, even just on pure numbers. Between 2012 and 2015, combined Federal and State core funding for theatre fell by $8.6 million to $57 million. In the same period, funding for Opera and Music Theatre fell by $7.9 million to $47.4 million. And this doesn’t even begin to take into account inflation and overall rising costs. Nor does it factor in the things that some of this money is tied to: some companies are obliged to return large proportions of these grants in the form of theatre rental, others give almost all of it back in payroll tax. And then there’s that Kafka-esque creation of the Hawke government, the perversely titled ‘Efficiency Dividend’ which according to the 2016 budget was forecast to save, i.e. take back, no less than $1.4 billion in subsidy over just three years.

The declining percentage of actual running costs covered by subsidy says it all. To take just the two biggest examples: STC’s subsidy in 1980 covered 47% of costs, by 1996, that had plummeted to a little over 9% and it now represents a measly 6.9% of the company’s running costs. The tale at MTC is much the same – as of this year, their subsidy represents just 8% of turnover.

Flawed income streams 

So where does this leave us? What are our options for survival, in a Post-Subsidy world? Our three current alternative income streams are well established and familiar, but all three are at the very least, inherently flawed and in many ways downright dangerous. I refer of course to those other three pillars: Box Office, Corporate Sponsorship and Private Philanthropy.

The risks entailed in excessive reliance on box office are obvious. In essence, it’s actively deleterious to the whole idea of developing an art form, in that the tacit contract with the vast majority of your audience is one of continuity and predictability. They keep buying tickets and turning up, because they know what they’re going to get. In this way, you end up not serving, but rather servicing, your audience, as opposed to leading them to new pastures. What must eventually happen when you depend on an audience for your survival is stagnation, because it hamstrings your ability to lead from the front. The tail ends up wagging the dog. Audience driven theatre is by definition conservative. In the long term, this has to lead to stasis in any art form. This dilemma is epitomised by the subscription model. Your regular subscribers get to ‘know’ your work (or at least think they do) and as long as they continue to like it, they’ll keep stumping up. By implication, if you change the nature of your work and start serving up different fare, they will in all likelihood, vote with their feet and go elsewhere. 

Classical opera and ballet also evidences this. Both forms still revolve almost entirely around very small pools of standard rep or mainstream works. Every now and then, a company will stick its neck right out there and radically program a modern work (which generally means it was composed only one hundred years ago) only to then watch dejectedly, as their loyal subscribers sit that one out. The same applies to vaguely contemporary realisations of this sacred repertoire. I must hold some sort of record by now, for working on productions for Opera Australia that have seen only one season of six or so performances, before being ignominiously retired to the great warehouse in the sky.

For this very reason, many companies around the world are now pondering moving away from this model, but when you’ve got a shitload of tickets to sell every year and your very survival depends on selling a massive percentage of them, the risk factor is enormous! It also curtails a company’s ability to forward plan and when this occurs, the first casualty are always the artists and by extension, the art.

As to corporate sponsorship, all the indications are that it’s already had its day. The amounts of income from this source flatlined several years ago and show no signs of improving. I think the reasons for this are fairly clear. Corporations used to regard arts sponsorship as an investment in the kind of advertising that money can’t buy. They derived considerable kudos by association and were able to parade as ‘good corporate citizens’. But they’re only interested if your work is perceived by them to align with their ‘core values’ (which is unlikely at best) and mostly, their contributions are easily financed from the petty cash tin.

There was a time for instance, when Esso contributed sizeable sums to Opera Australia – presumably because they saw this as a way to offset their public perception, which was already a bit on the nose. A classic example of an industry trying to offset its dubious public persona by association with a perceived higher cause.

But to be fair; we took their money. In fact we took it just as fast as they could hand it over! AND, tarts that we are, we sold ourselves very cheaply. Imagine my amazement when I discovered that the company who was billed above the title of one opera as ‘Generously sponsored by’ had kicked in a mere $200 grand – this at a time when that production cost ¾ of a million to make!

But the less meaningful our role in society becomes and the more we’re perceived as elite or a niche-market luxury only, the less likely we are to be interesting or useful to corporates.

Nowadays, a large percentage of corporate sponsorship takes the form of ‘sponsorship-in-kind’ usually in the realms of pro bono legal advice or management and financial consultancies, so technically speaking, they’re not even giving us any cash! In return, we become ‘client entertainment’ or ‘networking’ opportunities for these companies. Pathetic, really.

The growth of philanthropy

Private philanthropy is the great growth area for arts funding. Since 2001, it’s increased by over 300%. We’re all terribly excited about it! So I’m going to talk about it quite a lot.

The principal problem here is also pretty obvious. As soon as you’re using someone’s own money to make any form of art, you give that person the moral right to have a say in what that art is. It’s as simple as that. The minute you use that money to make something they disapprove of, disagree with, are offended by, or just simply don’t like, then they have absolutely every right to withhold that money. My first personal experience of this was back in the mid-80’s. Production sponsor comes to opening night and is horrified to discover that his money has been used to stage a slightly controversial production of an opera. The very next morning, he submits a list of changes to the company’s General Manager with the full expectation that they all be implemented before the second performance. What an arsehole, I hear you say, (I did at the time) but in a way, isn’t it his damn good right?

The increased amount of time, money and other resources that companies are having to devote to chasing these funds are massive. Flick through the administrative positions listed in subsidised companies 20 years ago and you’ll find a relatively small number of jobs with titles along the lines of ‘Development’ or ‘Sponsorship’. (My personal favourite has always been Director of Individual Giving!) Do the same exercise now and you’ll find that without exception, such titles outnumber those under the heading ‘Artistic’; often by a country mile. Furthermore, the people that do these jobs, come from the real-world economy, because that’s where we’re needing to get them from if they’re any good at it. Meanwhile, we who produce the ‘product’, we who actually make the theatre, continue to more or less happily subsist within our cottage industry economy, because that’s all we’ve ever known. This imbalance of sheer numbers, both human and financial, will I believe, over time lead to some kind of breaking point.

Another sometimes overlooked side-effect is the make-up of boards. It’s long been perceived wisdom, that the members of a theatre company’s board need to include a money person and a legal person. Much the same as any other not-for-profit organisation. Over time, this grew to include a fund-raising person. Now in addition to these, all board members are not only expected to be well connected fundraisers, they’re expected to personally contribute, out of their own pockets and via their friends – a bit of a quandary if you’re the token ‘artist’ on a board. What hope, under these circumstances, of more theatremakers ever getting a seat at the table that in many ways, determines the nature, or at least the viability, of a company?

Bear in mind that these are the same people who choose the company’s next artistic director…

Also not to be underestimated is the sheer amount of time and energy devoted to identifying, wooing and finally landing prospective donors. Alone the discussions around which donors should be invited to which productions – in other words, which show will they like and more importantly, which they won’t, take up enormous amounts of time and resources. In all this, the idea that a board is a group of like-minded people who might actively support the ideals of an arts company becomes somewhat illusory.

Meanwhile, the more we become reliant on a small number of wealthy donors, the more disconnected we become from the wider audience, to the point where we’ll end up being an indulgence. A plaything afforded themselves by the very rich. Until such time, of course, as the stock market next goes south…

So all three alternatives to greater subsidy are less than palatable. Even at current subsidy levels, there are already obvious effects on the theatre landscape.

These include:

  • Increasingly conservative programming and ‘balanced’ seasons in order to not lose or alienate too sizeable a chunk of your audience. Nothing new about the principle – there’s always been a balance in programming between comedies and tragedies; easier entertainments and more thought-provoking works; big/expensive and small /cheaper shows. But the decline towards cautious programming is of necessity increasing apace.
  • Smaller cast sizes. Six is now generally considered a big cast for a new work. A whole generation of Australian writers has grown up in and been constrained by, this environment, otherwise their plays simply won’t get on. The deleterious effect this has had on Australian playwriting, arguably at the very time where a whole new generation of Australian writers were starting to hit their straps, is showing. Any form of bigger canvas in our theatre has virtually disappeared.
  • Parochialism in casting – both of performers and production teams. Ridiculous budgetary hoops are jumped through by companies, just to ‘import’ a single actor, director or designer from interstate. This, in the context of a country whose talent pool is of necessity fairly small in any given centre, means an even further restriction on companies being able to choose the best horse for any given course. It also serves to increase a sense of internal stagnation, as the opportunities for all to work with a wider range of colleagues is reduced. This does nothing to broaden peoples horizons or ensure a fruitful cross-fertilisation of differences in approach. It’s also led to some pretty shonky practices in terms of companies leaning on people to ‘consider themselves Melbourne-based for this production’ all in order to save on the dreaded Living Allowance. I’m not suggesting that any company is being rapacious in doing this – merely that it amply illustrates the tightness of the budgets that all are forced to work within.

Another effect is the increasing incidence of co-productions. In principle, there is again nothing new about this and there are instances where this can be a beneficial thing, particularly for companies based in smaller cities. However in the vast majority of cases, there is no shared philosophical thinking underpinning co-productions at all – they are simply about companies having to get into bed with each other in order to be able to produce a year’s worth of work. They are predominately marriages of convenience, not co-operation.

The opera example

The landscape of opera in this country is a salient example of where this can lead. All four state opera companies used to produce their own annual seasons in addition to hosting performances by the national company. Throughout the late 80’s and into the 90’s, as burgeoning costs began to bite, the Co-Pro was increasingly seen as THE FINANCIAL solution and was enthusiastically embraced by most companies. In effect, it proved to THE FINAL Solution. Within a mere decade or so, this has led to a situation where all of Australia gets to see only one version of any given opera at a time, because that’s the only production of that piece in existence. It just does the national rounds.

I worked on a production of Verdi’s Il Trovatore which opened in Adelaide in 1999. Initially a co-production between State Opera of South Australia and W.A Opera, it has since been revived on numerous occasions in Sydney, Melbourne, Perth and Brisbane and to my knowledge, remains – 18 years and counting, the only production of this bog-standard mainstream work to have been produced in Australia. Now I’m perfectly proud of this production, although none of us like being publicly reminded of where our work and our taste was at, 18 years ago, but the fact that it remains the only production of this work available to the entire country is scandalous and surely the fastest way to ensure stagnation of an artform that’s imaginable!

This is but one of many such examples and is a direct result of the need for companies to pool their meagre resources in order to survive. Lest you think this situation is unique to the cost-heavy business of producing opera, the last five years have seen an unprecedented increase in the number of co-productions between Australia’s theatre companies. We’re well down that track.

A further side- effect of the co-pro survival model, is an instant shrinkage of employment opportunities for all theatre-makers. Ergo, an even smaller pool of companies to make work in and even more reduced opportunities to ply our trade, hone our craft – and earn a living! It also leads to a greater sense of commodification of productions, because they are no longer the exclusive property of the originating company. Instead of any given production being thought of as a piece of work, handmade for its moment in time and place, the tendency becomes to think of productions as an ‘asset’; a recyclable commodity, to be hawked around to the highest bidder, often shoehorned into totally inappropriate or unsympathetic spaces. Do whatever you need with it – as long as we continue to re-coup our investment. This is hardly in the spirit of good theatre making and it actively undermines the individual identity of companies. Rather than each company having its own clear cut image as a maker of theatre, it further serves to create an environment in which all companies are seen to be merely presenters, rather than originators, of distinctive works. This sense of sameness or lack of individuality leads to a vastly blander canvas. Meanwhile, a smaller pool of artists are engaged in making a smaller pool of new works – a steady erosion of the art form and evidence that the business model is broken. We’ll soon be running on empty.

A further side effect of the lack of money is increasing cannibalisation between companies and institutions, namely our culture palaces. Recent governments have displayed interest in funding institutions, rather than the art that these are intended to house. However, once you’ve built a Sydney Opera House, you have to constantly fill the thing with stuff, but partly because of its well-known shortcomings as a venue, any companies that can, will be quick to present their work elsewhere, leaving the venue short of product. That venue then has to finance the production, or usually purchase, of its ‘own’ work to fill the gaps. They partly fund this by overcharging their major (subsidised) hirers outrageously. Technicians are routinely charged out at double the wages they actually receive and it’s often cheaper to hire in equipment at commercial rates, than it is to use the gear that supposedly comes with the venue – such are the hidden costs. This sets up a cycle where government gives a subsidy to a producing company, which then pays a whack of that back to a venue, which has in turn been subsidised by the same government. A classic picture of a cash-starved industry turning on itself.

The future

Who will run such companies in the future? The less theatre companies are seen as subsidised or publicly funded entities, the greater the pressure becomes to see them being administered by ‘safe pairs of hands’, aka ‘responsible business people’ as they are no longer playing with nebulous public money, but people's own, hard-earned cash. This is not a conspiracy theory. Since the 80’s, there has been a steady trend towards the currently ubiquitous ‘Co-CEO’ model. It is truly ironic, that people from the corporate world that I’ve discussed this with, find that principle ‘scary’ or at best ‘unwieldy’, but that’s the way it’s rapidly gone. How much longer will it be before our arts companies are no longer run by artists? Unless we are all vigilant on this score, I believe it will be not too long at all and I further believe this would be the end of theatre as a true art form, in this country.

I’ve said why I think the likelihood of an increase in subsidy is slim and indeed, perceived wisdom has it so. There will be many shaking their heads patronisingly over these words But unfortunately it’s the only sustainable option. Only with greater levels of subsidy, can we continue to rise above the level of light entertainment. None of the alternative sources of funding are viable, without its underpinning. Have you ever wondered why a country the size of the U.S produces such a minute amount of good theatre? A virtual absence of public subsidy and an attendant dependency on private philanthropy would go a very long way towards an answer.

So the question becomes, how do we turn the anti-subsidy trend around? Every year that we continue to survive and manage to make work and raise our own money to do so, has further strengthened the hand of a political class that don’t actually want to fund us. Every opportunity we miss to make our case, reassures them that we don’t really need the money anyway and that we’ll go quietly. The longer we continue to just go with the flow and adapt to circumstances, as is our wont, the deeper the hole we dig for ourselves. We may in fact find that there simply aren’t enough Australians who want us either – at least not enough to pay for us. Therefore we need to become better and more strident advocates for subsidy and for our theatre. All of us, not just the leaders of our companies, need to be much more vocal about this. Many of those who run companies or sit on their boards are scared to speak out, fearing retribution by governments and their funding bodies, but I believe this is a risk we simply must take.

And we must take it together.

And we must do it now.

Lest we miss this bus too.

Nick Schlieper

Monday 20 November, 2017

About the author

Nick Schlieper designs for all of the major performing arts companies in Australia, and works regularly in Europe and USA.  He is one of Australia’s most highly awarded designers having received six Melbourne Green Room Awards, four Sydney Critics Awards, the inaugural 2013 Australian Production Designers Guild Best Lighting Design Award, as well as Helpmann Awards in 2004, 2009, 2011 and 2014.