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NAO publishes results of investigation into CRF funding

The National Audit Office found that £495m of Culture Recovery Fund grants and loans have been paid out so far, and identified a handful of cases of fraud

By IQ on 12 Mar 2021

Gareth Davies, head of the National Audit Office

Gareth Davies, head of the National Audit Office


The National Audit Office (NAO), the UK’s public spending watchdog, has found that just over half of the grants and loans awarded as part of the £1.57 billion Culture Recovery Fund (CRF) had been paid out as of February.

In a report, Investigation into the Culture Recovery Fund, published this morning (12 March), the NAO reveals that of the £830 million in CRF funding awarded so far, only £495m had been paid by 19 February.

The CRF, which was set up last year to assist entertainment, arts and leisure businesses forced to close as a result of the Covid-19 pandemic, received an extra £300m in last week’s budget, bringing total funding across three rounds to £1.87bn. For music and live entertainment businesses, funding is administered by Artists Council England.

Meg Hillier MP, chairman of the Committee of Public Accounts, has urged payments to be sped up. “The culture, arts and heritage sector has been one of the hardest hit by the pandemic, with many organisations now having been closed for nearly a year,” she says. “Many across the sector will have welcomed the funding announced last summer.

“But eight months later, more than half of the £1 billion made available so far is still waiting in the wings. With the sector’s shutdown already past government’s worst-case scenario [of March 2021], DCMS needs to get support out to organisations while there are still organisations left to support.”

“Many businesses are awaiting the outcome of the CRF 2, which will be fundamental to their future”

A spokesperson for the Department for Culture, Media and Sport (DCMS) attributes the delay to the necessary “safeguards taxpayers would expect to see in such a huge investment”.

“Applications are being processed for a £400m second round of grants and loans, and an additional £300m announced at the Budget will help the hardest hit reopen and recover,” they add. “This brings direct support for the culture sector to almost £2bn.”

The NAO’s report also found that two grants to be awarded by Arts Council England (ACE), worth nearly £0.5m, were withdrawn after they were found to be based on fraudulent claims.

“ACE told us that in no cases where a grant had been paid out had fraud been identified,” add the report’s authors.

Michael Kill, CEO of the Night-Time Industries Association, also urges DCMS and ACE to speed up payments where possible.

“Many businesses are awaiting the outcome of the CRF 2, which will be fundamental to their future, and ultimately have an impact on the cultural tapestry of this country for years to come,” he says.

 


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