Wednesday, 11 August 2010

Artists' Loan Questionnaire

From: Variant Magazine>

Date: 6 August 2010 13:04:53 GMT+01:00

To: Gwilym Gibbons>

Cc:,,,,,,,,,, [cut]

Subject: Re: Artists' Loan Questionnaire

Dear Gwilym

Thank you for your prompt reply and thanks too for the additional information about your research exercise on loans to artists. However, our concerns at Variant still stand. The key issues we see are the gathering of policy-based evidence and therefore, the questionable quality of your research project and the compromise of the arm’s length principle.

Clearly there are tremendous pressures to find ways to support artistic and cultural activities as we face government cut backs in public sector finance. Sadly, officials often assume that the public interest is synonymous with the mores of the government and bureaucratic agendas which, in this instance, seem to be all about more money lending. However, the public interest is not served by gathering 'policy-based evidence' in line with political thinking – something which has become notorious in policy studies in the UK. Such studies have shown the same construction process going on in everything from justifying military invasions to magnifying the socio-economic benefits of the arts.

We at Variant do not see any justification for singling out artists for special loan arrangements. More significantly, your commissioning partners, Mission Models Money (MMM), appear to have a diversity of in-house expertise yet the researchers you appointed have failed to explore alternatives such as investment in credit unions or how complimentary currencies are used by businesses elsewhere in the world. The researchers appear to have unquestioningly adopted the narrow national comparisons offered in your tender pack which, it must be said, appears unduly biased towards what is done in the United States. Consequently there are major oversights which suggest either a lack of seriousness in the research, a lack of resources for it, or both.

There is also no basis for suggesting that loans will not be a wedge into existing grant funding. A more pessimistic view is justified. The use of Lottery funds points to the real possibility that targeted credit systems would operate as the thin end of a wedge into grants. So this "suspicion" mentioned on the last page of your tender pack is not unsubstantiated.

As far as we can see, the research you have commissioned about financing artists in Scotland is not striving for objectivity and therefore it is not being conducted in the public interest. Needless to say this is a serious issue in public research financed by tax payers.

Shetland Arts' criteria for shortlisting potential research groups rightly included the following point: "[2] The robustness of the methodology - Has the individual/team added to/developed/challenged the brief in a way that demonstrates an appropriate degree of rigour?" We see no evidence that BOP has met this criterion in a survey which they describe as "the main body of the research".

Let us be clear about our own motives for challenging this research exercise. Variant voiced opposition to the formation of Creative Scotland on the grounds that its terms of reference, and particularly its adoption of an entrepreneurial ethos, was an erosion of the arm’s length principle. Creative Scotland has been formed under what many of our writers and readers believe is a faulty economic rationale coming from government and being imposed on the cultural sector. Nevertheless, this does not mean that the arm’s length principle is up for grabs as well.

Successive ministers have pledged support for the arm’s length principle and to the best of our knowledge no elected politician has openly refuted it. If Creative Scotland is to be informed by entrepreneurial imperatives so be it, these will now have to be dealt with transparently if the new organisation is to serve the broad public interest. In terms of conducting rigorous research about alternative funding for artists this would entail a detailed assessment of the deferral and adoption of risk though additional micro-credit systems.

Indeed we see from your tender pack that risk was discussed at length in a meeting with your partners from MMM. But there is no sign of this problem being addressed in any depth by your researchers. Evidence from other countries already suggests that micro-credit systems are not always benign, they can be highly exploitative, and they may well become more so. Although you say the sums of money involved in complimentary financing are small -- despite the survey propounding loans of £20,000+ -- accumulated they would be a significant addition to the already heavy burden of individual debt.

The alternatives to furthering a culture and economy based in usury are simply not examined in the research you commissioned from BOP. Yet they say that responses to their surveymonkey questionnaire will be "the main body of the research" and "will help form a strong body of evidence concerning the finance and support needs of Scottish artists and creative practitioners."

We do not know what methodology supports this sampling exercise but the research questionnaire itself seems poorly thought out and hastily put together. It appears to be little more than research into a new market for credit. This does not address many of the key issues that have been touched on by you and others involved in commissioning the research. It is therefore far from transparent. Nor do we understand why Shetland Arts - as a funded body - is playing a lead role in commissioning national research for which one would expect the SAC/Creative Scotland to take direct responsibility.

We therefore ask that this survey is closed down because it is gathering evidence in line with a well rehearsed political agenda. It is not investigating the broader issues in keeping with the arms length principle and the public interest which that principle is meant to protect.


Leigh French, Owen Logan

Variant coverage in the context of

broader social, political & cultural issues.

1/2 189b Maryhill Road

Glasgow G20 7XJ

t. +44 (0)141 333 9522


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Begin forwarded message:

From: Gwilym Gibbons>

Date: 2 August 2010 16:28:10 GMT+01:00

To: Variant Magazine>

Subject: Re: Artists' Loan Questionnaire

Dear Leigh

Thank you for your email and bringing to my attention your concerns and views. There is, in my view, nothing that intriguing behind my involvement in commissioning a study on small loan finance for artist/ and or makers. The origins of Shetland Arts exploring this idea was in response to a expressed need by several artists who just wanted a small amount of money to fund enhancement of their work. Framing of work was one example in which an artist wanted control of their final piece and to add value to the sale price of that work. Much of the discussion at that stage has been around finance of around £500 to add value to work that could be repaid after that work had been sold at an enhanced price.

I have attached the Tender Pack for the study which includes the initiating document I wrote in May 2009 that informed the development of this piece of work and the attraction of funds to pay for the research. I would like to stress that this piece of work was initiated by Shetland Arts and is in part supported by the Scottish Arts Council but pre dates Creative Scotland or my interests as a Board Member of this new organisation. It was simply a response to an expressed local need. I felt that the need may have relevance further afield which triggered the further exploration of the idea.

I understand that the 21st Century Financing Project was delayed but is now in delivery stage. The Steering Group for Creative Financing is working closely with the team working on 21st Century Financing Project and indeed the team working on Capital Matters .

The Creative Financing Study has been collecting pros and cons from a variety of stakeholders in the sector and your views will be added to those of others who have attended consultations and responses to the questionnaire. I recognise some of the concerns you raise and indeed have discussed them at length internally at the early stages of initiating this project. At no point has this piece of work proposed that loans should be offered in place of grants.

The Board of Creative Scotland meets for the first time in mid August I can not therefore comment on the position of the Board on the issues you raise. However, your comments are noted and with others will be fed into the report which will be made available to all those interested including Creative Scotland when it is complete.

I trust this allays some of your fears and thank you again for your comments.



Gwilym Gibbons


Shetland Arts Development Agency

Toll Clock Centre, Lerwick, Shetland. ZE1 0DE

Direct telephone: 01595 743731

Mobile: 07824 335502

Reception: 01595 743843


PDF : Creative Financing Tender Pack - April 2010


From: Variant Magazine>

Date: Fri, 30 Jul 2010 13:27:16 +0100

To: Gwilym Gwilym>

Subject: Fwd: Artists' Loan Questionnaire

Dear Gwilym

I am intrigued that you as Director of Shetland Arts and also a Board Member of Creative Scotland should commission a Scotland-wide survey "looking at the feasibility and potential benefits of providing loan style financing to artists, creative practitioners and small creative organisations".

Can I ask when you, as a part of the public sector, will also be commissioning a balance to this market positivism by examining the potential damage of "loan style financing"?

Moreover, can I ask where the assessment is to prove the viability of "loan style financing", which would include a comprehensive risk and impact assessment that one would expect prior to any attempts at justifying demand? I would hope that you would agree that post-2008 we should all be aware that fostering a culture of carelessness with regard to markets is a failure of responsible regulation and oversight we can ill afford again.

The SAC / government collaboration dropped its tender for '21st Century financing for the arts and creative industries in Scotland Study'. I am not aware of any other publicly-commissioned academic research in Scotland into Creative Industries loans or IPR exploitation or independent research on financing that takes into account the depth and effect of the economic crisis in Scotland. If this absence of a crucial evidence base is the case, which it appears to be, then Creative Scotland / Scottish government have no new or existing contextual, evidence-based research to facilitate the introduction of loans, but appear, circuitously, to be seeking to do so regardless of the risks to the sector(s) which they to date have failed to properly investigate.

If Creative Scotland / Scottish government do not even have such fundamental information on which to base the decisions it has already taken -- see Public Services Reform (Scotland) Bill: 29 Grants and loans (4) "Creative Scotland may make grants and loans to such persons as it considers appropriate for the purpose of, in connection with, or where it appears conducive to, the exercise of its functions", which the abandoned proposed study would lead us to believe is the case -- is it not negligent to continue to propose such impositions as loans?

It is again worth drawing attention to what recently happened in Catalonia, where the imposition of loans in place of public grants for arts organisations failed dramatically even in pre-crash conditions. The hard evidence of the failure of such neoliberal economic instrumentalisation of culture already exists internationally, and the Scottish Government (and the sector) would do well to examine it. A Creative Scotland profit-orientated approach to culture / information management belongs to a pre-financial crisis set of cultural / developmental policies. We all need to contextualise Creative Scotland with regard to the deeper policy issues such as the paradoxical responses to the financial crisis; a crisis which has discredited the 'Anglo-American' model of finance-led capitalism, yet the Scottish Government continue to pursue the main planks of that neoliberal agenda, including labour market 'reforms' and financialisation as is exemplified in what we know to be one focus of Creative Scotland.

To be clear: loans and IPR exploitation do not constitute a positive spending injection into the real economy, they contribute to finance restructuring leading to a concentration of wealth and centralisation of banking power -- this should come as no surprise to anyone when Creative Scotland was / is controversially being structured by bankers and financiers. Loans serve to increase public debt overnight (see the disaster following the introduction of artists' loans in Catalonia for details) and are part of a spiralling debt crisis, part of an approach that is at the core of the global economic crisis. And for those of us who believe in defending a public sector, fundamentally, the introduction of loans is to extract user fees for public services.

To reconfirm our objections to Creative Scotland proposals from 18 months ago:

- The proposed exploitation of Intellectual Property Rights and the introduction of loans coupled with an effective cut in 'arms length' grant aid, will all act to reinforce artists' poverty. The case of Catalonia shows that increasing artists' debts has been disastrous for all concerned.

- We feel strongly that this bureaucratic process has not concerned itself with representing artists' needs, nor does it address UNESCO declarations on culture and freedom.

- We have no confidence in the process of the formation of Creative Scotland, or the confused and inappropriate proposals that have arisen. We are simply not convinced that the proposals will promote the development of and entitlement to culture in Scotland.

I look forward to your response.

Yours sincerely,

Leigh French

co-editor, Variant


Subject: Fwd: Artists' Loan Questionnaire

We are currently supporting a comprehensive study looking at the feasibility and potential benefits of providing loan style financing to artists, creative practitioners and small creative organisations across Scotland. The study was commissioned by Shetland Arts and Mission Models Money who are interested in how loan financing might complement existing means of financing the creative industries such as grants and burseries.

As one of our valued members, we would be very grateful if you could follow the below link and complete an on-line survey, the responses to which will form the main body of the research:

The survey should only take no more than 15 minutes to complete and doing so will help form a strong body of evidence concerning the finance and support needs of Scottish artists and creative practitioners.

By way of thanks, BOP Consulting (the consultancy contracted to deliver the research) are offering respondents the chance to win one of two £20 Amazon vouchers.

Please note that all responses to the survey will be stored securely and kept completely anonymous.



BOP Consulting

20 Margaret Street

London, W1W 8RS

DL: 020 7307 3099

M: 07973 412 047