Australian Arts Organizations Struggle With Inflation In Costs

In recent weeks, a concerning number of arts programs have announced they are cancelling their events or are shutting down for good.

Castlemaine State Festival has gone into voluntary administration, Australian music festival Splendour in the Grass has cancelled its 2024 program (announced just days after its tickets went on sale), and regional music festival Groovin’ the Moo has done likewise.

In Hobart, the powerhouse producer of vibrant and experimental arts events, David Walsh of MONA, has also just announced his longest-running festival program Mona Foma, has no future. This comes on the back of another announcement by Walsh (made late last year) that MONA’s winter solstice festival Dark Mofo would hibernate, before announcing a reduced program this year and with no clear future vision beyond that revealed as yet.

It’s a sorry state of affairs that has, for the first time in a long while, caught the attention of many people outside the arts world – especially those who love the contemporary music festival scene – who are alarmed at the rolling cancellations playing out across their beloved sector.

Unfortunately, it’s not only large-scale music festivals that are copping severe losses, as many other vital players within the performing arts are battling rising costs in a funding environment that is simply not keeping pace with the price hikes associated with presenting arts events.

Some of these arts companies are indicating they will soon be drawing on their budget reserves or cancelling aspects of their core programing because they cannot afford to deliver events based on the current costs of doing their core business.

So, who else is feeling the pain, and what will the consequences for our sector be?

Who else is drowning under weight of rising costs?

The first example of another key arts organisation straining under the weight of cost issues is Fringe World – the Perth-based Fringe festival produced by Artrage, and which this year reached 600,000 people across WA with its summer performance program presented by thousands of different independent artists.

However, when Fringe World CEO Jo Thomas ran some metrics of her festival’s baseline costs over the past two years, her suspicions about the huge cost increases Fringe World has been incurring were confirmed in glaring fashion.

‘Our salaries and wages bill has increased 58% over the past two years, our hire costs have increased 96%, our transport costs have increased 56%, and our administration and insurance costs have gone up 50%,’ she tells ArtsHub.

‘This is all while our revenue has not increased at the same rate, especially because, as a Fringe festival, we have a responsibility to keep our ticket prices accessible. So we are not able to pass on these kinds of cost increases to our audiences,’ she adds.

Thomas’ cost hike concerns have recently led her to make a submission to the ongoing Federal Senate Inquiry into the National Cultural Policy (initiated by the Australian Greens in 2023 and led by Greens Senator Sarah Hanson-Young) to put Fringe World’s experiences on the record.

‘I noticed the Senate Inquiry has recently turned its attention to the problems music festivals are facing, and I wanted to raise the point that it’s not only music festivals that are suffering. Other arts festivals, like Fringe World, are drowning under the weight of cost increases too.’

Thomas describes her festival’s most acute cost pains as related to their need to build temporary outdoor staging areas to host their programs.

‘The hire costs of that temporary infrastructure, like fencing and outdoor toilets, have gone through the roof lately,’ she says. ‘It also doesn’t help that, in WA at least, there isn’t much commercial competition in that area, so we are limited in the providers we can use.’

Another west coast arts organisation buckling under the weight of sky-high costs is WA contemporary music peak body WAM (the WA Music Industry Association).

WAM Executive Director Livia Carre tells ArtsHub that her organisation – which supports WA contemporary music artists with professional development and advocacy programs throughout the year, and which presents an annual music festival dedicated to WA music acts – is finding that maintaining WAM’s program in the current cost environment ‘an uphill battle’.

‘Over the past three years, our travel costs have increased by over 37.5%, event security expenses have ballooned by a staggering 74% and production costs have surged by over 32%, risking the ongoing viability of many of our public-facing events and industry services,’ Carre says.

‘We have essentially had static operational funding for over a decade, so these increases in operational and event production costs are far outpacing the funding available to us, and these disparities significantly hamper our service delivery and often force us to make difficult choices, including sacrificing critical resources like staffing,’ she adds.

Nowhere left to make savings

Another voice sounding the alarm about mounting costs is Melbourne Fringe Creative Director and CEO Simon Abrahams.

Abrahams has been at the helm of Melbourne Fringe since 2015, and has therefore witnessed the impacts of Victoria’s extended COVID lockdowns on a festival that would ordinarily see Melburnians come together en masse to enjoy their city being brought alive by an array of experimental performing arts events.

‘COVID lockdowns were very dark times for us,’ Abrahams says.

‘But, that said, like many other arts organisations that were impacted by COVID lockdowns, we received some special COVID recovery funding that was very important in allowing us to get through that difficult period.’

For Abrahams, the current post-“COVID recovery” period presents some tricky challenges for arts organisations like Melbourne Fringe, which were recipients for COVID-relief grants that allowed them to support, and in some cases even extend, their programming to help them rebound and revive their programs after COVID lockdowns.

‘Our funding levels have actually decreased in the past years, because before that we received a number of COVID recovery grants that have now ended,’ Abrahams explains.

‘At the same time, our operational costs continue to increase.’

Abrahams tells ArtsHub that some budget calculations he did in 2022 revealed the raw costs of putting on his festival’s core program increased 39% between 2019 and 2022. The Melbourne Fringe Festival had two years of virtual festivals in 2020 and 2021 in the midst of Melbourne’s extended lockdowns.

Read: More music venue at risk as insurance cost hikes continue

‘In other words, it was almost 40% more expensive to present our festival in 2022 than it was in 2019,’ he explains.

And in a similar vein to Jo Thomas at Fringe World, Abrahams also says that there is no way he can increase the festival’s income from ticket sales to offset these increased costs.

‘The majority of ticketing revenue goes straight to the producing artists, and not to the festival,’ he tells ArtsHub. ‘Artists’ costs have increased too and, with cost of living pressures, there’s also an impact for audience members who wouldn’t necessarily buy tickets at increased prices.’

Abrahams says another key concern he has is around how to make budget savings to a budget that he has already cut to within an inch of its life.

‘I have already found a number of ways to make budget savings, but there is simply nowhere left to cut from without impacting our core programming,’ he says.

In essence, Abrahams says that any additional cuts made to his budget would shrink the size and breadth of Melbourne Fringe and see it supporting fewer artists, at a time when there are more independent artists in need of its support than ever.

‘Supporting artists is our number one priority, but how that happens is going to be impacted if our funding levels don’t change to acknowledge the cost increases we are facing,’ Abrahams says.

Thomas agrees, saying that as a proportion of Fringe World’s overall festival budget, it does not receive a great deal of government funding. But, in the current cost environment, there is urgent need for increased government support.

‘It’s a very hard time for organisations like ours that are facing such huge operational cost increases combined with a drop-off in sponsorship investment,’ she says.

‘Even though we had a hugely successful 2024 festival, we are still drowning under the weight of these costs and something has to change.’

ArtsHub will continue to report on these cost increases and their effects on the sector in coming weeks. To share your experiences:

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