Culture Recovery Fund - Repayable Finance Programme
Loans are available for charitable, not-for-profit and commercial organisations operating within England’s arts, museums and heritage sectors (including independent cinemas) that were financially stable before the coronavirus/COVID-19 crisis but are now at imminent risk of failure.
Funding body: Department for Digital, Culture, Media and Sport (DCMS)
Maximum value: Discretionary
Application deadline: 09/09/2020
The Culture Recovery Fund is part of the £1.57 billion support package for the UK’s culture and heritage sectors that was announced at the beginning of July 2020 in response to the economic impact of the COVID-19 crisis. The scheme is funded by the Department for Digital, Culture, Media and Sport (DCMS) and administered by Arts Council England; the national development agency for creativity and culture.
Objectives of Fund
The Culture Recovery Fund – Repayable Finance Programme is intended to support cultural organisations that have been affected by the coronavirus (COVID-19) crisis to stay afloat. The scheme will help maintain England’s cultural ecology by supporting culturally significant organisations which were financially sustainable before COVID-19 but are now at imminent risk of failure and have exhausted all other options for increasing their resilience.
The central aims of the scheme are to:
Enable cultural organisations to reopen/restart their operations, where appropriate.
Operate on a sustainable, cost-efficient basis so they are able to reopen at a later date if, for example, reopening under social distancing is not permissible or does not represent a value for money approach.
The investments made through the programme are intended to ensure that organisations can return to sustainable operations no later than 31 March 2022.
There is a total budget of £270 million to be awarded through loan finance.
Applicants may apply for a minimum of £3 million. There is no upper limit.
The majority of applicants are expected to be awarded loans which include a payment term of up to 20 years, an initial repayment holiday of up to four years and a 2% interest rate per annum.
Match Funding Restrictions
There is no minimum match funding requirement.
Who Can Apply
Cultural organisations in England that are properly constituted with a governing document may apply. The kinds of organisations that are eligible include:
Private companies (either limited by shares or guarantee) registered at Companies House.
Community Interest Companies (CICs), either limited by shares or guarantee, registered with the CIC regulator.
Charitable incorporated organisations (CIOs) registered with the Charity Commission for England and Wales.
Charitable companies or charitable trusts registered with the Charity Commission for England and Wales.
Limited liability partnerships registered at Companies House.
Partnerships established under a partnership deed/ agreement under the Partnership Act 1890.
Community benefit and co-operative societies registered with the Financial Conduct Authority.
Royal Charter bodies.
Statutory bodies and other public bodies including universities and museums that run or maintain cultural services.
For the purposes of this programme, ‘cultural organisations’ refers to charitable; not-for-profit; and commercial organisations operating within the arts, museums, heritage (including built, natural and intangible heritage) sectors, including independent cinemas, comedy clubs and nightclubs.
The Arts Council will not be able to consider applications that include:
Costs that are eligible to be covered by other strands of Government support, for example, furloughing.
Costs beyond the point recovery plans demonstrate a return to financial sustainability, no later than 31 March 2022.
Repayment of debt used to finance the business including bank loans, shareholder or owner loans.
New projects/activity during a prolonged closure period that are not essential to continued operations.
Reflating reserves beyond the equivalent of up to eight weeks’ turnover.
Non-essential building maintenance or capital expenditure.
Covering costs/losses already supported through other sources, including but not limited to any other Arts Council funding.
Costs related to the promotion of the beliefs of political or faith organisations.
The following organisations receive their funding from DCMS, so therefore cannot apply to Culture Recovery Fund – Repayable Finance:
The British Library
Imperial War Museum
National Portrait Gallery
Natural History Museum
National Museums Liverpool
Royal Museums Greenwich
Science Museum Group
Sir John Soane’s Museum
The following organisations receive their funding directly from the Ministry of Defence, so therefore cannot apply:
National Museum of the Royal Navy
National Army Museum
Royal Air Force Museum
Library services are not eligible to apply.
The finance provided should be used to support the costs to achieve financial sustainability, where possible by 31 March 2021, but by exception until 31 March 2022. Applicants can use the investment to help prepare for re-opening and re-starting work. Proportionate redundancy pay outs are eligible, where decisions have been made to reduce staff.
The Arts Council will support a combination of:
Costs to support sustainability through the preservation of the organisation’s critical assets, people and financial resources whilst the organisation has reduced operations, if that is the most cost-effective route to safeguard for the future, including:
essential business expenditure, such as staff salaries and fixed/operational costs.protecting cultural assets by:
maintaining buildings and other assets (including collections) while closed (including environmental monitoring and conservation);
stabilising collections at immediate risk;
temporary storage for collections, artefacts and documents;
supporting the retention of specialist skills and expertise.
security to ensure buildings and sites are secure over the closure period.
proportionate redundancy pay-outs where decisions have been made to reduce staff.
costs to prepare for reopening, including hiring staff and building working capital.
debts incurred as a direct result of the COVID-19 pandemic.
costs that may prevent the need for additional, unavoidable, public investment further down the line (for example, assets which may revert from third parties to public ownership in the event of insolvency, or otherwise need saving or protecting), or a future failure to deliver any statutory duties.
Operational costs incurred to enable the organisation to remain open, reopen or partially reopen, where this represents a value for money approach, does not constitute unnecessary risks and involves organisations trading. Eligible costs include:
essential business expenditure, such as staff salaries, freelance employment and fixed/operational costs.
equipment to ensure compliance with social distancing and other public health requirements.
any up-front costs for preparing to restart activities that will drive future income, such as performances, exhibitions and marketing.
redundancy pay outs where decisions have been made to reduce staff.
advice from professionals, for example on risk, safety, how to support staff or on new business models.
operating losses the organisation has incurred as a direct result of the COVID-19 pandemic, since 1 March 2020.
costs to ensure the value for money recovery of the organisation’s financial sustainability, including:
running risk management reviews and testing any identified actions to safeguard the organisation as needed.
reconfiguring business plans, governance and activity needed to help safeguard the future of the organisation.
considering or implementing organisational restructures and mergers where these have been identified as the most cost-effective way of sustaining an organisation.
reflating reserves up to the equivalent of up to eight weeks’ turnover.
How To Apply
There will be just one round of this programme, with applications accepted from 21 August (12:00 BST) until 9 September 2020 (12:00 BST).
Applications must be submitted through the Arts Council’s online application portal Grantium. Organisations that do not have a profile on the system yet will need to set one up as soon as possible, as it can take a few days to validate profiles.
Guidelines and FAQ documents are available on the website of Arts Council England.
The Arts Council will review applications, with input from other bodies including the British Film Institute, Historic England and National Lottery Heritage Fund.