Theatres and art galleries around the country are on high alert after the NSW Government decision to withhold an annual grant from Australia's biggest multi-arts venue, Carriageworks, forcing it to appoint administrators.
Key points:
- Sydney's Carriageworks is the first major arts venue to collapse due to the overnight loss of income stemming from the coronavirus shutdown
- One arts administrator has labelled it an 'ominous sign' for other organisations
- Arts insiders say its collapse exposes the tenuous position of many arts organisations, particularly those reliant on government funding
With Sydney Opera House tipped to take over the 5,000-square metre site, its former chief said he smelled a "classic Sydney power play", with the Government forcing an institutional takeover under the cover of the coronavirus shutdown.
Carriageworks is the first major arts venue to collapse due to the overnight loss of income caused by the sudden introduction of physical distancing rules.
"It's a very ominous sign for arts organisations everywhere," said Michael Lynch, the former Opera House chief executive considered one of Australia's most experienced international arts administrators.
Queensland Theatre artistic director Lee Lewis said when she heard Carriageworks had appointed accounting firm KPMG to assess its viability she thought, "there's the first, all of us are vulnerable".
She said the flagship state theatre company could only survive this shutdown with government support.
"We're break-even companies, not profit-making ventures. If the grant isn't there, there is no company, we'd have to close permanently," she said.
Nearly all Australian arts venues dimmed the lights in late March, instantly losing the income they earned from rentals, box office and some sponsorship.
Many organisations can only survive with rent relief and prompt or early grant payments from their state or local governments.
Federal body, the Australia Council, has brought forward payments to companies to enable them to stay afloat.
Carriageworks can host more than 5,000 people at a time and is visited by more than 1 million people a year, so it was acutely affected by the government restrictions.
State government funding made up almost a third of its last reported income.
Since it was founded in 2007, Carriageworks built up only limited reserves, in part because of hefty maintenance and expansion costs.
The ABC has been told the audited 2019 result will reveal either a small deficit or surplus.
The last activity at Carriageworks was a dress rehearsal for Sydney Chamber Opera's new female-led opera program Breaking Glass on March 23, but the world premiere scheduled for a few days later never happened.
The March 26 opening of a highly-anticipated immersive art exhibition by NSW artist Giselle Stanborough, co-commissioned with Tasmania's MONA and the Australian Centre for Contemporary Art in Melbourne, was also cancelled. A cafe on site and the popular weekly farmers market have also been mothballed.
During that shutdown week, management began consulting with KPMG, which was eventually appointed as administrator six weeks later.
When Carriageworks sought assurances from government arts funder Create NSW about its annual grant, due in July or August, it was told that it would not be paid.
A spokesman for Premier Gladys Berejiklian, who is Acting Arts Minister after the demotion of Don Harwin, told the ABC this week "Carriageworks had to prove [it was] solvent in order to get the payment".
The NSW State Government this week confirmed one rescue option for Carriageworks was a takeover by the Opera House.
Former arts minister Troy Grant welcomed this idea but only as a temporary measure.
"If that's a way to secure them until they can independently operate again, I'd support that," he said.
In an editorial in the Sydney Morning Herald this week, former Sydney Opera House chairman Kim Williams savaged the plan, saying the Opera House had been "literally prowling" to take over Carriageworks in an "egregious piece of empire-building worthy of robber barons".
The Sydney Opera House is the nation's most revered and internationally renowned art institution, heritage-listed by UNESCO and home to major national companies including the Australian Ballet and Opera Australia.
One arts insider with intimate knowledge of both spaces said: "Carriageworks has its own brand, it is nimble with flexible spaces where you can do big works."
"There is no way the industrial infrastructure of the Opera House with its layers of bureaucracy can work there, it's going to be way more expensive," the insider said.
Last year, the Opera House received $17.6 million from the NSW State Government, in addition to $103 million earned from rent, box office, tours, commercial activities and sponsorship now largely dried up.
As a NSW Government institution, the Opera House does not have to prove it is solvent.
It will receive its annual government grant, commencing in July.
The ABC has been told a group of philanthropists is ready to fund the estimated $2.5 million necessary to keep the site afloat during the shutdown, paying ongoing maintenance, electricity and security costs.
In recent years Google, Atlassian and the Seven Network have investigated possible co-tenancy arrangements which would have given the site a generous additional income stream but sources told the ABC those organisations all walked away because of government inaction.
Carriageworks is a short term tenant on government-owned land.
It was seeking a 45-year lease, akin to other arts organisations including Sydney Theatre Company in Walsh Bay.
A Create NSW spokeswoman attributed the delay to intra-governmental red tape.
"Create NSW was required to negotiate a new head lease with Transport NSW before being able to grant Carriageworks a new sublease, and the head lease negotiation was a lengthy and complex process," she said.
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2020-05-08 21:58:36Z
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