Demands by the Government's Expenditure Review Committee for a €5 million reduction in the Arts Council budget would have forced "drastic significant cutbacks" at some of the State's best-known cultural institutions, the Department of Arts, Sport and Tourism told the Department of Finance last year.
Following difficult negotiations about Budget 2003, the Minister for Arts, Sport and Tourism, Mr O'Donoghue was, however, eventually forced to accept a €3½ million cutback in the Arts Council's budget.
In a blunt letter to Finance in October, the Department of Arts, Sports and Tourism's secretary general, Mr Phil Furlong, said the €5 million cutback would have left the Arts Council with just €41 million this year - rather than the €53.7 million proposed under the Government's own Arts Plan.
"A reduction of this magnitude will certainly be interpreted by the arts community as a confirmation of their worst fears that the arts portfolio has been downgraded as a consequence of the recent reorganisation of departmental responsibilities with the commitment of the Minister to the sector inevitably being called into question vis-a-vis the undertakings of his predecessor," Mr Furlong told the Finance Department's second secretary general, Mr David Doyle.
He went on: "If the council has to live within an allocation of €41 million it will have to take very difficult decisions that will no doubt involve drastic significant cuts in its funding to many high profile organisations, festival events and arts venues.
"The Abbey Theatre, the Gate Theatre, Opera Ireland and Wexford Opera are all significant beneficiaries of Arts Council funding without which they cannot survive. The effects of retrenchment will be felt in many communities across the country."
The Government's Expenditure Review Body, comprised of the former governor of the Central Bank, Mr Maurice O'Connell, the former head of the Revenue Commissioners, Mr Dermot Quigley and the former secretary general of the Department of Enterprise, Trade and Employment, Mr Kevin Bonnor, was set up by the Minister for Finance, Mr McCreevy, to review all existing Government spending last autumn.
In his letter, Mr Furlong saidthat the body had given "absolutely no justification" for proposing a €5½ million cutback in the Irish Film Board's funding, and had clearly displayed that it had "no understanding" of the film body's role.
