The Arts Council is keen to engage in the debate and has asked us to host a response, which we are delighted to do. Roddy Gauld, the National Portfolio Director sent us the following:
In the current environment where funders and arts organisations alike need to demonstrate clear results in return for public funding, Key Performance Indicators (KPIs) are way of measuring our collective performance.
The Arts Council doesn’t see KPIs as a pass or fail measure, instead we hope arts organisations can use them as a tool for self-improvement, which allows them measure the extent to which they have achieved their ambitions. Demonstrating achievement, rather than just reporting data, is an exceptionally powerful argument for investment in the arts and our discussions with NPOs are helping us learn the extent to which it’s possible to reflect these achievements.
The majority of the Arts Council’s funding for the portfolio comes from the Treasury – so we need to be able to report convincingly on what our investment will achieve. The Arts Council is looking to National Portfolio organisations (NPOs) to be accountable for the funds they receive, with greater self performance management playing an important role in this.
We do realise the difficulty of standard KPIs, and that putting together one-size-fits-all measures of success for 700 very different organisations is an ambitious and challenging thing to do. Our ongoing conversations with NPOs are revealing areas where the Arts Council knows it will need to be flexible in both the design and the assessment of KPIs.
The finance KPI is a good example. It reflects the Government’s private giving agenda and also challenges NPOs to increase in the proportion of income they generate from non-Arts Council funding. We want these KPIs to be ambitious as we all consider how NPOs can make significant steps towards becoming more resilient. But we know that in some cases organisations will not be able to increase income for other sources, and for others it would be unrealistic to expect a year on year increase. Biennial festivals, for example, would not be expected to increase their non-Arts Council income in the years the festival isn’t running.
That’s why final funding agreements will contain KPIs agreed through discussion and negotiation with NPOs. Final figures should reflect the individual circumstances of organisations and be adapted if these circumstances change during the funding period. This process is based on working with NPOs to reflect our shared goals. It’s the first time the Arts Council has worked in this way and we are learning about how we can best use KPIs for the benefit of both the Arts Council and the organisations we fund.
We will continue to reflect as the process goes on, and we will decide if we need to change or adapt any KPI, or simply improve the explanation and guidance behind it. Whatever we decide, it will be based on the feedback we’re receiving from the discussions we are having with NPOs across the country.