Check against delivery Thank you for coming this evening. Tonight is really a report back to you about my reflections on arts policy after nearly a year as Shadow Culture Secretary.I arrived in the post a lover of the arts, but totally ignorant about arts policy. Looking around the room I can see many people who have helped me up a steep learning curve, not least some of the members of our excellent arts task force, ably led by Sir John Tusa. Thank you for your patience and help.On Sunday I went to the Royal Academy’s Summer Exhibition and visited a room curated by the new Academician Tracey Emin.She once famously once went to Margate, and found a camera that someone had left on the train. She appropriated it and used the film in the camera to take some remarkable pictures which can now be viewed at the Royal Academy. In the process of taking these pictures, she suddenly felt the urge to draw some graffiti on one of the sea walls which said “I need art like I need God.” Sometimes graffiti – however objectionable and anti-social it is in principle – can be very thought-provoking. There’s a wonderful slogan daubed on a fence alongside the M40 coming in to London which says “Why do I do this every day?” Thousands of stressed commuters presumably pause for a second as they pass it.What Tracey Emin was expressing in her graffiti was a heartfelt passion for art and its power to transform our lives. Ed Vaizey and I would not presume to compare our passion for and commitment to art with that of Tracey Emin, or indeed many other people in this room. But I hope over the last year or so we have shown that we are enthusiastic supporters of the arts. We both consider it a tremendous privilege to do the jobs we do and to help shape Conservative policy for the arts.Art and politics do not always mix well. Matthew Parris put his finger on this in a piece he wrote in the Spectator after last year’s Labour Conference. He had been asked to review the papers on Andrew Marr’s show, and the big interview after his slot was with the then new Prime Minister Gordon Brown. Everyone was getting nervous and fidgety until suddenly Matthew heard the sound of a violin. Nicola Benedetti was coming on to perform after Gordon Brown’s interview and was practising her piece in the corridor outside. Matthew said that after hearing the sound of this celestial violin nothing was the same. He couldn’t concentrate on Gordon Brown when he was being interviewed because his mind kept harping back to the sound of Nicola Benedetti, in comparison to which everything else seemed utterly trivial.The lesson to me from this is that when art and politics clash, art wins. Politicians beware. Indeed, what Ed and I have found, time and time again as we do our jobs, is that the arts are winning in almost every way. Every organisation we visit seems to be effective, imaginative and passionate, more than justifying the public investment they receive.However, Ed and I are also both aware, sadly, that there seems to be a presumption, for all sorts of reasons, that when it comes to the arts, you could sum it up as “Labour good Tories bad.” You could have paraphrased Tony Blair’s farewell speech on the arts as “arts began in 1997” and nothing came before.There were indeed ups and downs for the arts under the last Conservative government. But the truth is a lot more complex. The arts are indeed thriving, but I would argue that it began not in 1997 but in 1994 with the founding of the National Lottery. Through that remarkable institution £3.8 bn has been injected into the arts and £4.1 bn into heritage, almost £8 billion overall, a huge sum. The previous Conservative administration may have had few friends in the art world, but it was responsible for beginning this transformation, a transformation which provided not just funds but independence for thousands of arts and heritage organisations.That is not to say there are not things that Labour cannot take credit for. In particular, I would highlight three things: their willingness to highlight the wider benefits of the arts to issues like regeneration and education; increased funding from the Exchequer; and free museums.Let me deal with each of those issues in turn.First, the most significant change has been a willingness to put arts at the centre of social and economic policy. Arts can have a transformative effect in regeneration policy, education policy, quality of life policy and many other areas. Why is that? If we had understood in the 1960s what we now know about architecture, we could avoided much of the brutalism which means that Margaret Hodge has to make a very difficult decision about Robin Hood Gardens in Tower Hamlets this week. There is not a council in the country – Labour, Liberal Democrat or Conservative – that doesn’t understand the importance of the arts in regeneration policy.If we had learnt to value the arts in education, as Creative Partnerships is helping us to, I believe that we would have tackled literacy and numeracy failings much more quickly. 70% of heads involved with Creative Partnerships say it has helped improve their academic standards. Surely there is a lesson for all schools here.And finally we are starting to understand the economic impact of the arts, thanks to Chris Smith’s pioneering work on the Creative Industries – not least the link between the funded and for-profit arts sectors.But the arts do something else as well. Alain de Botton, in his recent book on architecture, said that good architecture is what helps you thrive and not just survive. I would argue the same is true of arts in general. In an increasingly competitive, pressured and demanding life, arts are what help us thrive and not just survive. It’s what David Cameron has called General Well Being.If politics is the debate about the future, art helps us to understand the present. Psychiatrists say that most stress is caused by worrying about the future. Maybe that is why we all need the arts. They bring us back to the magic of the present – perhaps with what Matthew Parris might call Nicola Benedetti moments.In an age when fakery is much derided – particularly amongst politicians in this place – the arts help us to understand concepts like authenticity. I have been to two Shakespeare plays in the last fortnight. One was Hamlet, performed by the Factory. This is a group of young actors and actresses who perform Hamlet in different venues every Sunday. They have no costumes, no set and ask the audience to bring along props. At the start they draw lots as to who will perform the different roles. It works brilliantly and is somehow totally authentic. On Sunday I went to see Lear at the Globe – a very different but no less valid type of authenticity.Given that Jonathan Freedland last week described the Prime Minister as having the jealousy of Othello, the ambition of Macbeth and the indecision of Hamlet, I was trying to work out which character he most resembled in Lear. Answers on a postcard please. Now under Labour we have swung violently in different directions in this intrinsic/instrumentalist debate. With Chris Smith heavily under the influence of people like Francois Matarasso there was enormous emphasis on the social impact of art. It was a new insight, but it also led to a crippling targets and performance culture which completely ignored the basic truth that great art simply cannot be measured.Under James Purnell DCMS signalled a radical move back towards the intrinsic agenda. That was overdue, but we must be careful not to overlook the enormous social benefits of a progressive arts policy. It would be a serious step back for arts to be put “back in a box” which considered the arts only of value to those who enjoy them.So a future Conservative government will move on from that debate, accepting both the intrinsic value of the arts and also the social impact of an enlightened arts policy. Secondly, let me acknowledge that grant in aid funding to the arts has increased since 1997. And let me state clearly that we absolutely support a mixed economy for the arts, in which funding continues to come from government, the lottery and private donations. In Britain we are uniquely able to benefit from the benefits of European-style government support for the arts and American-style philanthropy. Of course philanthropic giving should not be a replacement for state support. The Lottery was founded to raise funds that would be additional to exchequer funding. Private giving should also be additional.This is because often different types of giving do different jobs.It is unlikely private funding would ever support the creative risk taking at somewhere like the National Theatre, for example. But equally it is difficult to see the State backing a promising young violinist in a way that an individual philanthropist would do.For the arts to flourish we need different types of funding to flourish as well.Finally, let me state clearly that we will maintain free museums, which Chris Smith fought so hard to achieve. It is worth remembering that there were fierce internal battles within government on this. As many of you will recall, the Treasury, under one Gordon Brown, fiercely resisted the move. But Chris won, it has been a huge success, and under the next Conservative government it will remain so. No ifs, no buts.If I am prepared to be generous to Labour about developments like free charging – and indeed the general tone of public policy making towards the arts - I am less prepared to be so over the reality of what has been actually been delivered.Labour has styled itself as the Party of the Arts. Indeed, as I have acknowledged, there have been increases in grant in aid to the arts since 1997. But these have been massively outweighed by reductions in National Lottery funding, caused because the government has used the Lottery to fund many schemes other than the original four pillars envisaged when it was set up.In 1997 £906m of lottery funding went to arts and heritage. 10 years later this had more than halved to £444m. Combined lottery and exchequer funding to the arts and heritage has fallen by £276.3m. If you look at the money actually given out by the Arts Council to arts organisations, figures that I have released today show that it has fallen by 25% since 1997. That equates to £167m per annum.So what practical measures can you expect from a Conservative government to put this right? First, we will pass a National Lottery Independence Act, which will guarantee that the Lottery cannot be raided by politicians for their own pet projects. The Lottery will be returned to its original four pillars. While charities will still receive the largest share of the cake, the arts and heritage will also see their share rise substantially. That could potentially mean that on today’s figures, we would generate an additional £53m for the arts and £41m annually for heritage.Secondly, we will bear down heavily on the costs of administering arts funding. We want to ensure that as much money as possible passes through the DCMS and Arts Council without being eaten up in administration.Further figures I am releasing today show that for every pound spent by the government on the arts, only 88 pence actually reaches arts organisations. In the last four years the DCMS, Arts Council England, the MLA, and the Heritage Lottery Fund, have swallowed nearly £400m in administration costs - £100 million a year. Had we controlled the spending on administration more effectively, reducing it to just 9%, the money would have been there to continue funding every single one of the 158 arts organisations that had their grants withdrawn in January this year.Let’s also get rid of the financial merry-go-round which sees the DCMS funding the MLA, the Arts Council and English Heritage and then those same organisations paying back over £1m to DCMS in charges and fees. We will also at how we can help arts organisations reduce their own administration costs, particularly by scrapping the targets and form-filling that have become such a nightmare.Far from being the party of the Arts, Labour has become the party of Arts Bureaucracy.Our own Arts Task Force, ably chaired by Sir John Tusa, recommended another way to reduce bureaucracy. He suggested that large arts organisations should be funded directly by DCMS rather than through the Arts Council. That is a very interesting – indeed radical proposal. We believe that the time is ripe to have a debate about the role of the Arts Council. Do not get me wrong. We support the principle of an arm’s length body distributing funds, free from political interference. But that has become increasingly blurred. For example, the Department commissioned the McMaster report, and then expected the Arts Council to follow its recommendations. That same month when James Purnell was challenged about the Arts Council cuts he hid behind the arms-length principle as a reason not to get involved. So it feels like arms-length when convenient, an arm-lock when not.We need to, and we will, have a debate about how the Arts Council should work alongside a big department of state, and with increasingly confident and autonomous performing arts organisations, a debate that has never happened and is long overdue. It is not a debate designed to undermine the Arts Council, but one that I hope will lead to its renewal.But Government is not the only player in the arts world. Many individuals make a huge difference to the arts. If you said to me what is the one thing I could do as Culture Secretary that would make a real difference to the arts, I would say it would be to help foster an American-style culture of philanthropy to the arts and culture here in the UK. In the US they give 1.7% of their income to charitable and cultural organisations, compared to just 0.7% here in the UK. If we were to increase that giving to just 1% of our GDP, that would generate nearly £4bn extra in income.We used to say that private individuals are not as generous as America because we are not as rich as they are. That is simply not the case now, especially when you look at the City of London.The government has shown little or no interest in the potential of philanthropy, shamefully letting the Goodison Report fester for 3 years.So what could a Conservative government do?We have recently published a green paper on the Voluntary Sector. This set out how we would simplify and strengthen gift aid. For the first time we also pledged to make it a Government objective to drive up levels of gift aid claimed.Within the cultural sector specifically, we need to look at removing the bureaucracy that prevents cultural organisations from recognising and acknowledging the generosity of their benefactors. The current rules are hopelessly bureaucratic. We would like to simplify these rules so it is easier for organisations to know where they stand when it comes to rewarding their donors.Secondly we need to look at how philanthropy can be rewarded through the honours system. Given the extraordinary importance of individual donations to our artistic and cultural organisations, what better way to reward and acknowledge generosity? This is particularly important for one group of benefactors who are feeling very unloved at the moment, namely non-doms. Let us not forget that many non-doms more than make up for their tax-free status by extremely generous contributions to our national life in other ways.But the honours system should not simply reward financial philanthropy. Many volunteers support the arts and heritage sector generously with their time. The National Trust alone has 50,000 volunteers. This too must be recognised for the vital contribution that it is.Thirdly we need to look at what can be done to encourage artistic and cultural organisations to build up endowments. US museums have endowments valued at $14 bn. This gives organisations a critical artistic and professional independence from their political mastersYet few of our artistic organisations have endowments, instead desperately raising money to survive on a hand to mouth basis. Those that do, such as the National Gallery, crazily have to keep them abroad to avoid the Treasury reducing their grant pound for pound for any income they generate.Setting up endowments are the next big frontier for the UK arts world to cross, and a future Conservative government will look carefully at what can be done to encourage them.Finally we need to look at what can be done over lifetime giving. One of the golden rules of fundraising is that once you develop a relationship with a benefactor, provided you handle that relationship well, the amount they give can increase over time quite dramatically. So it is important that the incentives for philanthropy exist while people are alive and not just for legacies.So far, all I seem to have done is to talk about money and bureaucracy! These are certainly important areas of debate at the moment. But there is another equally important - and huge - aspect of the arts that I have not yet touched on - arts education, and especially music education.Again, credit where it's due. The Government set up the Music Manifesto, and has put money into music education, and indeed singing education as well. It also set up Creative Partnerships, an organisation I have come to know well since I took on this job, and I do recognise the progress made by Paul Collard and the team at Creative Partnerships. Now we have the ten Find Your Talent pilots, and a pledge to deliver five hours of culture a week.There are other initiatives as well. Just last week, Julian Lloyd Webber announced a scheme to provide musical instruments. He, like many others, has been inspired by El Sistema, which drew a legion of new fans last summer when the Simon Bolivar Youth Orchestra and Gustavo Dudamel came to visit. My main criticism would be that there seems to be a blizzard of initiatives, many of them stop-start and quite a few not thought through, but we are not getting the basics right. Proper teacher training for example is something that urgently needs to be looked at. It is still the case that 40% of primary school pupils would like to learn a musical instrument but do not. Only one in five secondary school pupils has played a musical instrument in front of an audience. And nearly half do not visit any museum or gallery. So there is a lot of room for improvement.There is a also a great deal of money spent on these initiatives which could, I think, be spent much more effectively if there were fewer programmes with more straightforward ambitions. Finally, as you know we as a party are committed to giving parents more choice in education. I want to extend that idea to music and the arts, and find ways of empowering parents and pupils to make their own decisions about the music education they receive and where they get it from.Tessa Jowell once quoted a civil servant as saying all the arts want from government is “policy, money and silence.” I hope I haven’t gone on too long.I want to conclude by returning to my opening remarks. Tonight is not just a chance to look at where we have got to after almost one year in this job. It is a chance to thank everyone in this room for all that you do to make the arts in Britain so successful. Politicians like Ed and I, and Andy Burnham and Margaret Hodge , will of course desperately try and take credit for that success, but after all is said and done it is thanks to you that this has happened. A Conservative government wants to support, nurture and encourage that success. We will not seek to set the direction of travel, except with the lightest of touches. We will instead concentrate on creating a framework that allows you to thrive and not just survive. To play your part in building a society rich in its emotional register; deep in its self-knowledge; and broad and tolerant in its outlook.The arts in Britain are a huge success. I have only one task. To help you make them even better.