Business Sponsorship

Oral Answers to Questions — The Arts – in the House of Commons at 12:00 am on 10th February 1986.

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Photo of Tim Yeo Tim Yeo , South Suffolk 12:00 am, 10th February 1986

asked the Minister for the Arts what is the present level of business sponsorship for the arts.

Photo of Mr Richard Luce Mr Richard Luce , Shoreham

The Association for Business Sponsorship of the Arts estimates the figure at about £20 million.

Photo of Tim Yeo Tim Yeo , South Suffolk

Does my right hon. Friend agree that the level of business sponsorship could be substantially increased if companies were allowed, along the lines of the American model, to deduct their donations to charity up to an agreed limit of pre-tax profits? Does he further agree that that would be cost effective, because, for each pound of tax revenue forgone, expenditure on the arts would increase by almost £3?

Photo of Mr Richard Luce Mr Richard Luce , Shoreham

It is important to acknowledge the significant contribution that the business sponsorship incentive scheme has made to increasing the amount of money for the arts in the last 15 or 16 months. It now amounts to £6·7 million. That is a great deal of additional money for the arts, and I have increased the amount in the financial budget for the forthcoming year. My hon. Friend knows that a number of positive tax changes have been made in the last few years. They are designed to encourage additional business sponsorship of the arts, and I hope that there will be further improvements. My hon. Friend's specific question ought to be addressed to my right hon. Friend the Chancellor of the Exchequer.

Photo of Mr Clement Freud Mr Clement Freud , North East Cambridgeshire

I thank the Minister for looking further into the question raised by the hon. Member for Suffolk, South (Mr. Yeo). Will he tell the House how many applications, under the business sponsorship incentive scheme, were turned down last year because it had run out of money?

Photo of Mr Richard Luce Mr Richard Luce , Shoreham

The scheme has not run out of money. It is continuing throughout this financial year. I have already announced that there will be an increase in the taxpayers' investment in the scheme to the tune of £1·75 million in the coming financial year.

Photo of Mr Norman St John-Stevas Mr Norman St John-Stevas , Chelmsford

Since business sponsorship has tragically failed to raise the small sum of money needed to keep the Sadler's Wells theatre open, what plans has my right hon. Friend for finding the £250,000 that would save the nation from a major cultural disaster?

Photo of Mr Richard Luce Mr Richard Luce , Shoreham

I acknowledge the importance of my right hon. Friend's question, and I am glad to be able to tell the House that the Arts Council has made an announcement on that important matter today. It has called a meeting with Sadler's Wells and the three companies which regularly use the theatre to discuss a possible solution. That would involve the Arts Council giving the companies additional funds to enable them to pay an economic rent for the theatre. I hope and believe that in that way the theatre can be kept open.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

Is the Minister aware that the figure of £20 million for business sponsorship is only an estimate, and I believe that it is far less than that? Will he take steps to ensure that the recording of business sponsorship money for the arts is more accurate than the present guesstimates, otherwise a misleading impression will be given?

Photo of Mr Richard Luce Mr Richard Luce , Shoreham

I take the hon. Gentleman's point. In fact, I suspect that that is a conservative estimate. We work in conjunction with the Association for Business Sponsorship of the Arts, which exists to encourage the sponsorship of arts organisations by business. I accept that it is difficult to put a precise figure on it. It is a guesstimate.

Photo of Mr Alan Howarth Mr Alan Howarth , Stratford-on-Avon

I strongly endorse the thoughts offered by my hon. Friend the Member for Suffolk, South (Mr. Yeo), but, in the meantime, will my right hon. Friend look at some of the anomolies in the present business sponsorship tax regime? In particular, will he consider whether sponsorship of capital projects could be made tax-deductible, as is sponsorship of revenue projects? Will he ensure that the rules governing the provision of entertainment facilities at sponsored events are both sensible and sensibly administered?

Photo of Mr Richard Luce Mr Richard Luce , Shoreham

I know that my hon. Friend takes a close interest in finding ways in which we can encourage further sponsorship and support for the arts. I know that some of those ideas have been put forward by ABSA and submitted to my right hon. Friend the Chancellor of the Exchequer. At the end of the day it is for him to decide what further improvements he can introduce.