Private Sector Support Drops in 2012 for Major Performing Arts Companies

In its report released today, Tracking changes in corporate sponsorship and private donations, the Australian Major Performing Arts Group found that private sector support for the major performing arts companies had fallen in 2012 by 1.6 per cent ($1.1 million) compared with 2011.

Private Sector Support Drops in 2012 for Major Performing Arts Companies

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Private sector support, which in 2012 stood at $64.1 million, included funds raised through individual philanthropy, corporate sponsorship and fundraising events. Of the 28 companies surveyed, 16 reported a fall in private giving in 2012.

After sharp increases in 2011, income from donations (private giving or philanthropy) decreased $3.7 million (13.2 per cent) to $31.3 million.

On the other hand corporate sponsorship rose in 2012 by $2.5 million (8.9 per cent) to $30.4 million. This was the fifth consecutive year of growth in corporate sponsorship, but the first in seven years where growth exceeded CPI.

On average, private sector support in 2012 provided 14 per cent of total company revenue, compared with 15 per cent in 2011.

Over the past five years, private sector support as a share of total income has grown 1.9 per cent. Box office provided 43 per cent of income (40.2 per cent in 2011), government base funding 30 per cent (31.3 per cent in 2011), other funding 5 per cent and other income 8 per cent.

‘The drop in philanthropy last year may be showing that the philanthropic climate is becoming more cautious’, said Ms Bethwyn Serow, Executive Director of the Major Performing Arts Group.

‘It is certainly something we will be keeping a close eye on over the next 12 months.

'Private support is critical to how our member companies operate. It enables them to do things they could never otherwise afford—for example, better talent development, delivery of free or accessibly priced shows in communities and schools, or run mentoring programs with emerging artists’, Ms Serow said.

In 2012 philanthropy still represents the largest proportion of private sector support at 49 per cent compared with corporate sponsorship at 47 per cent.

Overall, 16 of the 28 companies reported an increase in earnings from sponsorship in 2012 with 12 companies reporting a decline. Western Australian companies are still benefiting from a strong mining sector, reporting significant increases in corporate sponsorship earnings. Queensland companies again reported the highest proportional increase in corporate sponsorship in 2012—up 17.5 per cent on 2011 levels.

‘A holistic view across the 12 years in which the survey has been conducted suggests larger companies and those with a wider national footprint can access higher levels of sponsorship and philanthropy than the small and medium-sized companies, although all companies have experienced some level of volatility across the years’, Ms Serow said.

‘Last year was no exception. Large companies reported a $4.4 million increase in total corporate sponsorship, philanthropy and net fundraising event income, whereas medium companies reported a fall of $1.7 million.’

Small companies also reported a decrease ($3.7 million) in total corporate sponsorship, philanthropy and net fundraising event income in 2012—mainly due to the normalisation of income levels of those companies that received extraordinary support in 2011.

Strong support from the private sector depends, to an extent, on government encouragement, and initiatives that demonstrate confidence in Australia’s major performing arts companies. The recent Mitchell review into private sector support of the arts recommended a number of government initiatives that would encourage more private giving.

‘The government’s introduction of a modest matched funding initiative for the broader creative industries is a positive first step in building strategies to strengthen the Australian environment for private giving to support the arts’, Ms Serow said.

‘However, at $7.1 million, the fund is inadequate in the longer term if it is to support the entire creative industries sector.

‘There are other reforms that would cost very little but would improve the outcomes for fundraising and private giving.

‘For example, removing some of the current barriers that impede tax deductibility for some fundraising events would simplify the environment for giving’, she said.

For further enquires contact:

Bethwyn Serow, Executive Director
Tel: 02 9253 5351
Mb 0417 754 472

Philanthropy and Sponsorship Results 2012

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