Kilkenny Arts Festival is one of Ireland's cultural highlights, yet it's wrestling with tight budgets and financial uncertainty, writes Rosita Boland.

The 30th Kilkenny Arts Festival was opened, in the city's Design Centre, by John O'Donoghue, Minister for Arts, Sports and Tourism. For once, nobody worried about an opening being outdoors.

In his speech on Friday evening Mr O'Donoghue described the festival as one of the most important in Ireland, noting: "This position is reflected in the fact that it has attracted strong support from the Arts Council, to the tune of €300,000 this year alone."

The festival did indeed receive that sum from the Arts Council this year but, like Galway Arts Festival, it is now at the end of its three-year cycle of funding, and neither Kilkenny nor Galway knows yet what will happen next year.

Sharp-eyed readers of Saturday's newspaper may have been puzzled by the photograph of German artist H.A. Schult's installation of Bin Soldiers in the ground of Kilkenny Castle. There were a lot of soldiers in the picture, but not as many as was originally reported.

The festival's advance publicity had billed the installation as an army of 1,000; a figure repeated in Saturday's paper. However, only 250 Bin Soldiers marched into Kilkenny - there was not enough money to transport the other 750.

The life-sized soldiers have been on the Great Wall of China, in Moscow's Red Square and at the Pyramids in Cairo. In Kilkenny, once the official opening was over, the red tape that surrounded them was finally removed, and curious children in their scores got to poke and examine the sculptures, which will remain in the castle grounds until the festival ends on Sunday.

The main festival event of the weekend was the Tower of Light fireworks display in the castle grounds on Friday evening, performed by an English company, Walk the Plank. An estimated 4,000 people turned up, while more camped outside the walls, hoping to see the fireworks from a distance.

The company constructed a tower on the castle lawn, which became a lighthouse as darkness fell, a beam of light circling the grounds. There was a very slow build-up to the show, which began with a soundtrack on the history of lighthouses and a performance on the ground, bemusing many of the audience, who were expecting only fireworks.

Maybe we haven't seen enough fireworks displays in this country to appreciate the additional performance element in some shows: Irish audiences seem to like their fireworks served straight up as a main course, without the distraction of starters.

The audience finally got their fireworks some half-hour into the show, and they were spectacular enough to wake up the small children who had fallen asleep waiting for something to happen, and to please the restless adults.

However, apart from the slow start, there was also some unhappiness about charging for this event: tickets cost €6, with a limited number of family tickets for €12.

There was a feeling locally that the firework display, billed as the festival opener, should have been free of charge, no matter what the state of the festival's budget.

As is traditional, on Saturday several visual arts shows opened. The craft school at Grennan Mill, Thomastown, was the venue for two major shows: interactive artist Anna Hill's Auroral Synapse and Edward Carey's etchings and installations. Hill's show, a beautiful multi-media piece on the midnight sun and aurora borealis of Lapland, was accompanied by an original soundtrack from singer Iarla Ó Lionáird.

Ursula von Rydingsvard's exhibition of large wooden sculptures, entitled A Psychological Landscape, was opened in the Butler Gallery by Patrick Murphy, director of the RHA. In Butler House collages made by the late Armenian artist, Sergei Parajanov, went on display. His films can be seen this week at the Parade Tower in Kilkenny Castle.

This year a number of artists are exhibiting alongside the main festival, collectively entitled Full Circle. These include Ross Stewart, Michael McGrath, Caroline R. Baker, Joan Brennan, Mary Butler, Richard Coghlan, Etaoin Holahan, Jacqui Dempsey and Lindsey Perry.

The enterprising Dempsey and Perry hired an open-top bus on the first day of the festival and literally took their audience with them to see their show, which consists of several photographs hanging at locations around the city, including the cinema and the Watergate Theatre.

Other highlights included the Small Theatre of Vilnius's production of Lermontov's Masquerade; the Stuttgart Chamber Orchestra; and the Kopelman Quartet.