Government of Catalonia forces cultural projects into debt in order to receive grants while reserving the right of payment
For the last two years the Government of Catalonia has been delaying payment by more than 12 months on grants for culture, a situation which has led many projects to close, reduce their activities to a minimum, or seek loans from banks in order to cover daily expenses. This year’s open call for subsidies has even incorporated a new provision stating that the awarding of a subsidy is not a guarantee that this subsidy is going to be paid.
Below is a public communication from the cultural sector in response to the current dismantling of public cultural policies by the government.
The new provisions arising from Law 2/2014 of January 27 relating to tax, administrative, financial and public sector measures, specify that awarded subsidies may be reviewed and modified in whole or in part, to ensure the fulfillment of the objectives for budgetary stability and financial sustainability.
A transitional provision has been also added to this law which introduces the possibility of amending the resolutions of concession, i.e. subsidies already approved and granted. With this provision, the awarding of a subsidy is not a guarantee that this subsidy is going to be paid, which puts organisations and individuals that receive public grants in a situation contrary to the principle of legal certainty.
The signatories want to bring awareness to the fact that this provision opens the door to situations that will be untenable for culture workers in Catalonia. The provision therefore sets the scene for the radical impoverishment of both creativity and the value chain generated by creators, cultural spaces and centres, professional associations and all those agencies and organisations around the country working in collaboration with the public sector. This law effectively amends the general rule regarding the amount of the subsidy awarded, as stated in the third general rule of the OSIC (Office for the Support of Cultural Initiatives) and the fifth general rule of the ICEC (Catalan Institute of Cultural Industries).
We believe that this provision provides legal coverage for the Government and may seriously harm cultural initiatives and agents, leaving them in situations of serious debt, bank overdraft, and having to deal with uncontrollable risks. This represents a step towards a progressive dismantlement of the section of the cultural sector that works with a public service vocation.
This provision comes in addition to various other circumstances which have weakened the cultural fabric of our country, being also the result of an abusive policy begun in 2012. Since then there have been delays of over 12 months in the payment of grants, during which time the affected projects and spaces find themselves in very difficult situations attempting to deal with their costs, including not only staff but also payment to external collaborators and suppliers. However this situation of debt is now being “normalised”.
While this fully demonstrates the precariousness of a key sector such as culture, the new transitional provision further adds the impossibility of attempting to secure a loan, since no bank will accept as guarantee a government that reserves the right to not pay. Furthermore, the amount granted may be withdrawn at any time, regardless of whether the activity has been completed or not. This brings organisations to an unsustainable situation: if it is already difficult to conduct loan negotiations based on an administrative decision which has no guarantee, the idea of a possible cancellation or reduction of the awarded amount questions whether the effort is worth it.
Another option is that individuals, patrons of foundations, or board members of associations may endorse a loan with their own assets, as some have already done in the last year, personally assuming a risk delegated by the Government. The current situation in the sector is unheard of: debt is transferred to producers and individuals who are financing the entire value chain linked to contemporary cultural production and creation.
We do not want to be reassured by the willingness of the Cultural Department not to see any of these extreme situations come to pass. We ask the Government of Catalonia, and specifically the Minister of Culture Ferran Mascarell, to act responsibly and not patronisingly. If what they expect is a financial “disaster”, we should be able to have a real and feasible budget and not virtual figures that generate debts and force many projects to shut down. We also believe that the Department should not make communications based on figures apparently attributable to the cultural sector, as it has been doing lately, but ensure that granted subsidies constitute real commitments and contracts.
We have been very concerned about the consequences of these measures from the moment they were made public, especially because of the real possibility of their implementation. For this reason we ask for the repeal of this law and/or the transitional provision.
Furthermore, the cultural sector strongly dissaproves the Goverment of Catalonia’s increasing tendency to force the “municipalisation” of culture through delegating its responsibilities in this area to municipalities. This regressive tendency entails the dismembering of an already very fragile sector. Moreover, the situation may further be aggravated if the new law for Local Administration (LRSAL), which is applicable in all Spanish territories, enters into force. This new law paradoxically divests municipalities of having any responsibility in the field of culture, among others.
The coincidence of all these elements places the cultural sector of our country in an extremely fragile situation. We want to express our unease about the measures our Government is implementing against contemporary culture and creation in Catalonia.
Barcelona, April, 2014
Subsequent to the writing of this communication we hold a meeting with the Department of Culture of the Government of Catalonia on the 24th of April. During the meeting the representative said that the inclosion of the transitional provision in the rules for grants in 2014 was approved by the full Parliament of Catalonia and affects all lines of the government’ subsidies. They also stated that their will is not to have to apply the provision. Regarding the concern of the cultural sector to have enough cash to finance their projects while waiting for the payment of subsidies, the Department expressed its will and committment to help the sector in the negations with the financial institutions so the projects can be able to deal with their daily expenses in the meanwhile.