Introduction

Financial management and viability of actions in the cultural sector go together insofar as tangible and intangible values become assets on which to base future development.

Needless to say prior to adopting a special system of accountability to ensure financial management of the cultural sector it must be cautioned that what works in one context does not necessarily in another. Cities are ill advised if they try to imitate practices of others and simply adopt blindly financial management systems without knowing what it entails in particular for their own cultural sector.

It can certainly prove to be quite a difficult task, namely to identify in a satisfactory way viability of actions in the cultural sector. Given a certain amount of money being made available, there are always different stands to follow, in order to allow for such viable actions. For instance, building a theatre or adding an addition to the existing old museum is a response to a need which comes with time. Discerning is, however, the time it takes to recognize such a need at Municipal level and then finding the financial means to implement such a project.

Time delay is explained by the very simple fact that everything has to be implemented according to financial accountability as public body. Yet these are not the only reasons for the delay. Coming into age, is a saying with some validity not only for a child growing up, but a local community coming to terms with cultural demands. Another reason is that usually money is not readily available and therefore must first be found.

Finally, once local governments have articulated the aim to realize cultural actions and other kinds of cultural investments, they must adhere to given guidelines not only with regards to spending possibilities, but more so they must heed certain key constraints as they can at times work together with private partners.

Realization, even in the fields of culture, is for any financial management approach quite simple: the action has to function i.e. bring something to work and pay for itself within a reasonable time period. From a financial managerial standpoint the problems with the arts and culture are immense.

Things are as complex as disorganized with often no outcomes in sight for quite some time, and then suddenly within the last two months prior to the opening of the exhibition, the artist displays a spurt of creativity and literally explodes in his paintings. There is the famous anecdote of someone not painting till an entire year was over and when the count who was sponsoring this artist asked him, but why should he pay him for the other eleven months when he really only worked to realize the concept during the last month of the year, the artist replied but he needed those eleven months to think about what he would paint.

Performance indicators are, therefore, not very reliable or conducive to artistic work. The problem for the local authorities and also for financial management is how to justify payments when there is no visible result for most of the year, to use this example to illustrate the point of having to make a distinction between ongoing learning and real outcomes.

There is a danger when normal financial managerial practices are introduced into the cultural sector and this without consideration for being quite a different context than, for example, industrial production.

Special experiences in Eastern Europe where the free market was introduced after 1989 and many cultural institutions had to adapt to changing financial framework conditions e.g. no more state subsidies and need to face competition for funds and sponsors on a market not to be defined solely in economic terms e.g. film festival and their audiences for films and videos not shown in main cinemas since not included in the usual distribution system.

Specific financial requirements for cultural planning:

By having to commit resources to specific categories, some very common mistakes are made:

• cultural planning within the administration tends to reduce culture to what is commodifiable when culture is also about suspension to have creative tensions as much as there is ‘intangible heritage’ (see definition by ICOMOS – story telling, memories, meanings given to places, invisible but important artistic forms e.g. way to link music to dance and vice versa as there is always the question who takes the lead to become authentic)

• only those things are financed which have a calculated expectancy of certain returns (risk assessment) and therefore, as Zuz from Australia would remark, it leaves aside voluntary work and creative expressions of an entire community basing its relationships on non financial terms (see definition of festivals – Federica Vigano).

i. Funding of cultural sector – what are here the different options?

Cultural infrastructures and cultural investments are not the same as it is a matter of not knowing how much money should be spend in order to act as stimulus for further activities to be attracted and to unfold, but without public financing (speculation on spill over effects).

General thesis: active core group – issue perceived at cultural policy level of the city as having future and therefore promoted e.g. giving free of taxes space – e.g. multi media in Dortmund, Ars Electronica in Linz etc.

How much leeway to give to these private initiatives and what must be still within the realm of public policy a responsibility by Ministry of Culture and other governmental agencies along with Municipal Council if something is to be undertaken for the arts and culture?

ii. From basic definitions to what kind of financial strategy?

In Wiki, it is explained that the field of finance refers to the concepts of time, money and risk and how they are interrelated. The term "finance" may thus incorporate any of the following:

• The study of money and other assets

• The management and control of those assets

• Profiling and managing project risks

• The science of managing money

• The industry that delivers financial services

• As a verb, "to finance" is to provide funds for business or for an individual's large purchases (car, home, etc.).

Source: http://en.wikipedia.org/wiki/Finance

5.1 Financial management of the cultural sector

The main concern in this part of the study is to look at, assess and propose how effective financial management can be introduced to a cultural sector more often resilient to financial questions and more often than not short changed when it comes to be accountable to the public bodies which are willing to support cultural activities.

Since 2000 a shift has been noticed to alter financial management from spending too much time on ‘external reporting’ and to concentrate much more on giving strategic support to various units in order to improve the overall performance of the service providers (however designed and set to function within various forms of governance) and to be more ‘result’ orientated (as measure of efficiency).

Things can be approved by

1) Knowing where financial responsibility lies and this includes knowledge how internal and external control mechanisms for the sake of accountability have to complement each other.

2) Require audited financial reports on a yearly basis but should be suited to cultural projects having different than yearly time horizons, but how can this be made into an ongoing monitoring process?

3) For accountability it is important to set expectations for various agencies and departments involved in the cultural sector to deploy a modern financial management system.

Financial management system

To be able to go from an overall concept to practical implementation, it has to be clear that financial management requires clear solutions and a follow-up where not proper information is obtained. The terminology is decisive. There are jargons in circulation which reflect a borrowing of metaphors from other domains but distort reality when applied to the cultural sector. That is why care needs to be taken not to transport concepts from the financial domain into the cultural sphere as if the same when reference is made to, for example, 'windfall profits' = unexpected sources of income.

When it comes to giving the public authority opinion about proper spending for culture as interlocutor for cultural groups, civil society and its NGOs, there has to be created a platform of open communication about financial needs and how they are covered.

However, private sponsors do not wish to reveal in public how much money they have given for a specific cultural action. Disclosure is, however, paramount to see that even if public funds make up but 40% of the total budget, full accountability has to be given. Otherwise there is a lack of credibility at stake.

Information Management - need information about leading cultural organizations in terms of risk assessment - data bank and information obtained under secure conditions with confidentiality a matter of clear concern to all partners involved (internal versus external reporting / what lee way to give if problems need to be worked out) - improving on goals and performance orientation (how to meet targets, financially speaking e.g. upgrade the urban culture in four specific domains: children, youth, learning and performance cultures) and this will include ongoing review of categories used to designate spending priorities according to vision and expectation of culture as source of creativity and innovation; in the USA it is called ‘mission performance’ - information technology assessment and needed investments to upgrade use of computer based data gathering systems whereby updating to attain consistency over time is one of the most crucial elements in order to discover gaps in reporting; a follow up needs a certain authority and legal competence to be covered by administrative law and concept of public administration responsible for the public and cultural sector since these two are intertwined - framework for check list - core framework check list: practical validation in two ways: a) systematic b) financial probes to check on validation procedures (money taken, spend and reports linked with this, including outcomes secured)

Financial and Performance Management -         what are key decisions to secure funds for culture and how does this differ to capital decision making (short/medium and long term dispositions) with the decisive factor being what to do when extra money comes in unexpectedly and therefore makes other resources available compared to what had not been planned in the original budget outline (value / asset / reduced risks assessment schemes – often called ‘wind falls’) - internal control: knowing where every cent goes and avoidance of waste (the economy of good financial management) - external control: independent audit but also readiness for reviews but other governmental agencies of e.g. Central Ministry or regional authority. - for effective implementation need such governmental guidelines (general nature e.g. safeguarding cultural heritage) which give special support to local communities to fulfill cultural demand in relation to sustainable development (organizational level and capacity to deal with this demand) - to capitalize properly on cultural developments at various levels (individual, group, city wide with further linkages to regional and international development), there is needed a special financial management (responsible, out of debt, clarity in categories, sense of fair distribution, reward system) - measuring performances: primary and secondary indicators can let decision makers react before too late when information is coming in something is going wrong while ‘substantial work’ goes unnoticed and therefore is not compensated (need to set a difference between superficial and substantial success). Performance measures must also be seen in terms of relationships, outcomes and results while maintaining levels of spending over a certain period of time -         outsourcing of finance and accounting functions (in relation to accounting practices in the cultural sector) especially if there is money floating around and needs to be put to use in a good way by giving leeway to independent organizers with autonomy in financial management i.e. how the money is to be used for a project.

Human Capital Management - key principles as applied by private organizations (payment for staff in relation to income made by the organization to establish proportionate cost estimates) - self assessments: values produced and financial means claimed (personal work / materials/ work process / outcome secured) for artistic process and cultural actions - build up of a civil service sector able to operate the financial management system of the cultural sector - strategy for involving and binding highly qualified employees / artists / cultural workers / cultural managers (differentiated strategies for fruitful collaborations in formal and informal sectors) - online training and ongoing learning - techniques how to deal with changes in values and beliefs and how to deal with changes as part of an ongoing qualification scheme

Process Improvement - restructuring organizations - implementation: job process and related improvement requirements (working conditions) - lessons learned by governments when it comes to privatization - downsizing strategies in organizations (making them become superfluous) - process assessment guide - best practice methodology: improving governmental services - terms related to privatization and processes, including guidelines for PPK partnerships - organizational options to improve the functioning of cultural sector services and upkeep of cultural infrastructures

Source: Creating Value through World Class Financial Management, (2000). General Accounting Office of the United States. Reference: GAO/AIMD-00-134

What is asset management?  When the arts and culture becomes a critical asset?

“Asset management is a strategic business process and decision-making approach to managing the on-going maintenance needs of physical assets such as transportation infrastructure.

Asset management requires the use of outcome-based performance measures, and uses data-driven analyses to link those goals to a maintenance program. It involves the economic assessment of trade-offs among alternative maintenance investment options, and as such combines engineering and economic analysis to identify cost-effective investment decisions over an extended time frame.

Given the notion of long-term, life cycle efficiencies, asset management analysis often results in the use preventive maintenance techniques, rather than waiting for a highway, bridge or tunnel to deteriorate significantly before rehabilitating it. Asset management can result in significant cost savings over the life cycle of transportation infrastructure.

Given current budget limitations and the deteriorating condition of the nation’s aging highway system, an increasing number of Departments of Transportation are using asset management practices. Asset management is also commonly employed in partnership projects because of the cost efficiencies it creates. Asset management practices can be used equally well by either the public or private sector.” [1]

Types of assets:

Historical dates, memories as to who lived there, specific dwellings e.g. Anna Frank’s house in Amsterdam and concretely the tree which the administration wishes to cut down while others wish to preserve the tree out of memory reasons.

Diaries and paths taken by artists: the living archive (friend of Frederique who did some work on this – creative learning – art historian: you only understand a painter and his works when you follow the process of painting and are present when the shape of the eyes are altered or one body more is added or taken out of the group portrait as these decisions reflect more than artistic reflexes, they are also evidences of historical circumstances)

Collections of arts and their growing value over time

– even a matter of laying the base for a future museum to house this unique collection e.g. ‘Blue riders’ around Kadinsky and the Murnau painters

– see Bachmann museum at Starnberg

http://www.buchheimmuseum.de/

Management an Kunst- und Musikhochschulen Kunstakademie Düsseldorf 1.-2. Juni 2006

Gemeinsame Veranstaltung des Zentrums für Internationales Kunstmanagement

(CIAM) und des Zentrums für Wissenschaftsmanagement

"Das Management der Kunst- und Musikhochschulen in Deutschland steht vor großen Herausforderungen. Diese resultieren aus der internationalen Entwicklung, der Hinwendung zu Methoden des New-Public-Management in vielen Bereichen der öffentlichen Verwaltung, der Verlagerung von Verantwortung für Kunst und Kultur vom staatlichen Bereich in den privaten beziehungsweise "dritten" Sektor sowie der zunehmend problematisch werdenden Finanzierung.

Da die Kunst- und Musikhochschulen einerseits Kulturbetriebe mit dem vorrangigen Auftrag der Pflege und Entwicklung der Kunst sind, andererseits dem tertiären Bildungsbereich angehören, müssen sich Ziele und Methodik des Kunstmanagements mit denen des Wissenschaftsmanagements verbinden."

Dr. Wolfram Schüßler

Zentrum für Wissenschaftsmanagement ZWM e.V.

0 62 32-6 54-3 74

schuessler@zwm-speyer.de

www.zwm-speyer.de

H-MUSEUM

H-Net Network for Museums and Museum Studies

E-Mail: h-museum@h-net.msu.edu

WWW: http://www.h-museum.net

Upgrading of culture as asset for future development

Upgrading of assets through other artists coming to the same place one generation later and doing likewise brilliant work – myth of the place / meaning given to a place due to artists being there – creative spaces – streams of time – subjects and people e.g. James Joyce and Dublin converting Ulysseys into a cultural route which has by now become famous for cultural tourism. (the lived and the imagined reality faced with the problem of how to keep up the myth of the place while things look different and more banal in reality?) (cultural heritage sites in Bulgaria: entire village operated as if in the nineteenth century) – e.g. the James Joyce economy (extended to include professors and others who strive on the specialization on James Joyce). There is at issue how to disseminate culture when materialization includes trivialization and popularization until the original intentions are hardly recognizable anymore. Salzburg has been dubbed as Mozart town but then the Salzburg festivals do transcend that single reputation even though the image returns in the form of Mozart chocolate balls, while the revolutionary content of ‘Marriage of Figaro’ goes really unnoticed for the most part. There are decisions to be made on how to ‘capitalize’ on something becoming a cultural trend (more than a mere fashion) for some obvious and not so obvious reasons. Identification of the audiences or public with a specific artist has a complex motivational background but reflects itself what this specific person exemplifies or else has illuminated upon in his or her life. Going to Prague means certainly looking up where Kafka lived and worked and it does matter if you happen to live on the same street as did Karl Marx, namely Rue Jean D’Ardenne in Ixelles of Brussels. Crossing the same square where he used to observe Belgium workers can relive the scenes of then but also be compared to how questions of social justice are answered differently in the twenty-first century. The public administration has to secure cultural assets not only financially (plate with name, restoration of house, conversion into museum) but also what information is available in bookshops, online and in conjunction with related topics of those times what other leading figures filled that scene from writers or painters to politicians. ‘Keeping memories alive’ is a targeted activity requiring investments and sustained efforts insofar as incomes are secured by sales of these artefacts and visitors, but also it can be extended to donations and the like.

Financial management covers following areas once public spending is involved:

• Multi-year strategic financial and management plans;

• Departmental expenditure and operational improvements (e.g., sanitation, fleet management, public safety);

• Non-tax revenue enhancements; tax policy options;

• Operating and capital budget development support;

• Capital program management improvements;

• Benchmarking/performance measurement/comparability analysis;

• Managed competition and other forms of outsourcing;

• Labor-management analysis and expert testimony;
  Water and wastewater utility reviews; and

• Economic development strategy.

5.1.1 Viability of actions in the cultural sector

Artistic achievements never come about without someone taking a risk. Subjugating funding of such actions to a criterion like ‘viability’ risks denying many to try a forward looking strategy. In cultural actions many things come together: support by political authority, overcoming skepticism (and passivism) of local population, anticipating things in need to be in place when action starts and having the cultural inputs (paintings) in place at the time needed.

In the Volga region when adapting the concept of Cultural Capital Cities viability of cultural actions depends upon people opening up to new and experimental artistic expressions (as they tend to accept only traditional forms of expressions well-known to them). Thus the viability of cultural actions depends itself upon a proper analysis of what cultural needs people have e.g. Kapuscinski names the lack of ‘cultural tools to cope with changes’ a key need of people of the former Soviet Union which exposed to them to all sorts of cultural demands once the Soviet Union broke apart. After many years of repression cultural assertive movements contribute less to integration and provoke more readily violence as contradiction to cultural demands be based on non violence.

a) infrastructures

European Cultural Foundation

http://www.eurocult.org/we-advocate/capacity-development/

Capacity development

‘From Cultural Values to the Value of Culture':

Regional Parliament of Zilina, Slovakia adopts new cultural policy framework initiated by ECF-run project with overwhelming majority

On October 30, 2007, a great majority of deputies from all political parties represented in the Regional Assembly of the Self-Governing Region of Žilina in the North-West of Slovakia, voted in favour of a new cultural development strategy for the entire region. The adopted strategy was initiated by an ECF project in the framework of our cultural capacity development activities.

If cultural life is to flourish, then adequate support structures are needed. These include professional cultural organisations and up-to-date policy frameworks.

This cultural infrastructure is often taken for granted in Western Europe. But in places affected by political, social and economic instability, extra efforts are required.

The ECF strives to make individuals and organisations capable of sustaining cultural life in their town or country or region; and more than this, to make them capable of cooperating culturally with others in Europe.

Active in many transitional countries in Europe and neighbouring regions, the Foundation helps organisations improve their working structures and develop their management skills. We also support those who can reform and develop cultural policies locally.

We believe that developing and sustaining cultural infrastructures:

§ Increases the quality and diversity of cultural production and enables new kinds of creative activity

§ Strengthens the cultural sector, particularly in areas affected by social and political instability and economic transition

§ Builds creative partnerships between cultural operators, administrators and local communities

§ Encourages citizen interaction and the development of participative cultural policymaking

§ Offers the opportunity for local players to engage in cultural cooperation, nationally and internationally

§ Improves the quality of life locally

§ Brings economic benefits, often substantial ones.

We offer cultural management training and advice on how to create new organisational strategies. This training and advice helps cultural organisations strengthen their internal capacity; it also prepares them for dialogue and creative partnership with local administrators and policymakers (‘participative' cultural policymaking).

Our projects are centred on locally developed ideas and initiatives. We base our engagement on local expertise and human capacities and we emphasise local project ownership.

http://www.metropoliscongress2008.com/default.asp?PageID=35&n=Commission2

Metropolis Commissions http://www.me http://www.metropoliscongress2008.com/default.asp?PageID=35&n=Commission2tropoliscongress2008.com/default.asp? PageID=35&n=Commission2

Commission 2: Financing of Urban Services and Infrastructure

14:00h-15:30h Friday 24 October 2008

The main mission of local and regional authorities is to provide services of quality to the citizens at reasonable cost. Depending on competences and fields of activities of each authority, these services relate to culture, sport, leisure, urban waste, transportation, water, public safety, environment or parks to mention only a few.

Moreover, in order to fully assume their responsibilities and to ensure the leading role of their city in the national and international economy, the local and metropolitan authorities must equip their cities with adequate infrastructures; essential to development.

These infrastructures and the dynamism of the various economic agents, combined with favourable conditions, ensure the competitiveness of the city. These infrastructures relate to the sectors of transport, water, environment, telecommunications and culture, but also that of dwellings.

Consequently, the local and regional authorities need adequate financial resources for true financial and taxation autonomy. They must have the financial tools specific to large cities, decrease the tax burden of the individual and corporate taxpayers and make their cities attractive for citizens and investors.

To this extent, they must improve their financial capability by acquiring modern management tools, by increasing their internal performance but also by establishing a true partnership with the government so that it endows them with taxation instruments adapted to their context and to the international economic situation.

b) content and cultural substance

Viable actions to raise cultural literacy

Prefecture of Evros, Greece

1. PREVIOUS EXPERIENCE

• The Med-Urbs Programme was about the creation of a Multimedia Cultural Tourism Guide for each partner - area, in CD-ROM (completed)

• Urban Pilot Project for the City of Alexandroupolis (Alex.Poli.Net), with the aim to transform it into an International Networking Centre and for the creation of the necessary infrastructure (submitted-approved)

• Ecos-Ouverture Programme of the Prefecture of Evros, in cooperation with Burgas/ Bulgaria, Lietuva and Latvija, on new energy networks

• Leader I Project on innovative actions for rural development, in the areas of Soufli, Tychero and Ferres (south west, along the estuary of river Evros)

• Telematics Programme (DG XIII), by the Democritus University of Thrace, for the creation of an electronic Thesaurus of regional data on History, Civilization, Environment and Tourism

• Euroform and Horizon Projects

• Envirreg Project

2. MAIN ISSUES (p. 17)

• support the network of local libraries, by transforming their structure in order to operate as local resource centres

• trans-national networking of libraries, using new information and communication technologies

• (the rest as has been written, mentioning always libraries as the common reference point)

 

3. ORIGIN OF THE PROJECT (p. 22)

Participation in previous projects is being documented above.

The preparatory work for the project comes, mainly, from the realisation of the 10-year Programme for the ‘Modernisation of Libraries and the Promotion of Reading in the Prefecture of Evros’ (contract agreement, signed in February 1997, between the Ministry of Culture, the National Book Centre of Greece, the Association of Local Authorities of Evros, the Cultural Enterprise of the City of Alexandroupolis and 12 other Municipalities and Communities). Associate partners include all the local services of the Ministries of Education (responsible for the primary and secondary schools), Defence (responsible for military camps of the district) and Macedonia-Thrace, the National Foundation for the Reception of Immigrants, the General Secretariat for the Youth, the Democritus University of Thrace with its two libraries, the Association of Booksellers, social groups, cultural associations and the media.

A survey of the libraries has been completed, documenting their present situation, the problems they’re facing and the measures that have to be taken for their upgrading.  Seminars have been held for librarians, schoolteachers, and booksellers on various training items, having to do with new technologies. Organisation of the registration and membership systems has been suggested and applied to all libraries, even the smallest ones, by NBC experts. Reading groups/book clubs have been coordinated with target groups of the local population. Libraries are going to be financed to purchase new series of book titles. A major conference has been held in Alexandroupolis, on May 2^nd, with the participation of all local authorities involved.

The basic objectives of the 10-year programme (with a total budget of 400 million Gr drs. or 1.3 million ECU’s), include:

• the promotion of reading and the upgrading of the reading habits of the general public, which is characterized by very low reading indicators

• the promotion of the educational, informational and entertainment usage of books

• the upgrading of libraries’ infrastructure, including their buildings and electronic equipment, and their connection to networks

• the encouragement of people to seek various kind of information through libraries

• the connection of libraries to the local society, participating in its economic and cultural life

• the cooperation between libraries and the local Booksellers’ Association

• the creation of equal opportunities for education, information and reading for all and the combatting of illiteracy

• the preparation of the local authorities in order to be able to cope with the needs of the cultural management of libraries

 

4. PRESENT SITUATION OF THE AREA (p.23)

Prefecture of Evros accounts for 144,000 inhabitants and is a border Greek prefecture, touching upon the borders with Turkey (to the east) and Bulgaria (to the north). It represents the eastern edge of the EU. It belongs to the Region of East Makedonia – Thrace (together with the prefectures of Komotini, Xanthi, Kavala and Drama), which is the 12^th poorest region/ NUTS II area in the EU - accounting only for 43.3% of the average per capita GDP of the EU - and the most scarcely populated region in Greece.

Thrace was connected to the rest of Greece only in the first quarter of the 20^th century, in 1922. After the defeat of the Greeks in their war with Turkey, in 1922, borders were finalised and a major exchange of populations between the two countries took place, leaving only a small Muslim minority in the prefectures of Xanthi and Komotini, in respect to the greek minority that was allowed to stay in Imbros, Tenedos and Konstantinople (Istanbul). This evolution has left Evros practically with no religious minority (with the exception of a few Pomaks that live in the north). On the other hand Evros has given shelter to thousands of Greek refuges coming from Asia and Pontos , a tendency that has been perpetuated until today, with the policy of reception and sheltering in Evros the Greek immigrants coming back from countries of the ex-Soviet Union.

Despite the fact, the total population of Evros decreased from 148,400 inhabitants, in 1981, to 143,790 in 1991 (decrease of 3.1%). Appart from the major urban centres of Alexandroupolis and Orestiada, all other urban centres have shown decrease of population.  40% of the working people work in the agriculture, 15% in the manufacturing sector and 44% in the service sector (the respective figures for Greece are 30%, 30% and 40%)

15 libraries are taking part in the project, among which 13 are Municipal and 2 belong to Cultural Associations. Two of the municipal libraries are mobile. The average book stock is not larger than 4.000 - 6.000 books for each library, with the exception of the Municipal Library of Alexandroupolis that has about 11.000 volumes of books, together with its childrens branch. Only 3 libraries employs qualified librarian personnel (the ones of Alexandroupolis, Orestiada and Soufli). Two, at least, are facing problems of moving to more appropriate buildings in the near future.

c) Festivals

Viable actions for a city are ones which do not incur debt, either direct or hidden, with regards to rental of spaces, use of equipment, involvement of all kinds of staff, and public relations costs. The problem is that anything in the cultural sector can very easily and quickly get out of control. Budgetary limits are often disregarded or else the success criterion not observed: a minimum of surplus, if not a breaking even by so many people having attended and enjoyed the event. Things should not end up being an embarrassment to the city.

When a city is willing to provide funds for festivals, it should be done in a systematic way and be administrated through a special festival fund to which local organizers and others can apply. For example, the City of Toronto has an investment funding program for festivals with following criteria for selection of application:

• Value to the community: the role and relevance of the organization/project to the community it serves.

• Impact on the community: contribution of the organization/project to the community. This can be reflected in terms of public activity, outreach initiatives, community development, volunteer involvement, community participation, resource and service provision, and economic and social benefits.

• Achievement: project goals and lasting benefits to the community.

• Accountability: in terms of fulfilling its mandate, meeting its goals and objectives, and in its financial accounting. An organization/project is accountable to the community it serves, to its members (if applicable), and to its funders, and should have a means of assessing accountability to each.

• Financial viability: the financial impact of the grant to the project and the organization’s ability to deliver the program.

• Self-sustainability: how the organization will replace City funds to obtain self-sustainability within 4 consecutive community festivals.

Source: 2008 Community Festivals & Special Events Investment Program GUIDELINES

http://www.toronto.ca/bia/pdf/festival-a.pdf

Viable action can be the organization of a yearly festival. It can be dedicated to special categories such as music, film, art etc. in order to highlight specific features of the contemporary culture. Usually festivals appear to be wide open to the public and therefore allow an intermingling of various types of activities. There are the famous special ones in reflection of an overall cultural preference such as the film festivals in Cannes or Berlin.

A closer review of what it takes to organize festivals can illuminate already on what premises ‘viability’ can be attained:

• timing of the festival, including length and duration to coincide with what? (cultural calendar)

• significance of the name or theme for how easily does it lend itself to organizing the event

• venues (streets / cinemas )

• concept and program but also what kind of contributions / participations are solicited

• key appointments for specific people to work in the organization but as well who is appointed to sit on the jury, if a prize is to be awarded since selection thereof permeates the quality of choices made and recognition given as a result of having participated in the festival (the binding element)

• logistics of the organization and time rhythm (conceptual phase, preparation, actual event and follow-up)

• must know what audience is to be attracted and who shall come in addition unexpectedly while there is a critical level which needs to be attained if the event is to be deemed as a successful one

• hotels and restaurants: there are places which can deal readily with an enormous influx of people regardless of income level while in other cities there is a shortage of good, equally economical accommodation; the same applies for restaurants and food places available which can and do add to the overall atmosphere generated by a city during a festival with many more people wandering around and ready to discover new places

• cultural atmosphere linked to character of city which should not be in contradiction with the spirit of the festival (in Bruges as a preserved city with historical monuments to organize a Jazz festival seems out of place but is done by the cultural department of the city in order to offset the image of being just a museum of the past)

• media coverage

• PR work: bringing together people is one thing, attracting famous names another and making the interaction be worthwhile for all still another matter

• Information made available

• Demands made upon special places in terms of transport of people and preparing in advance the program has a lot to do with how things are organized in a way that the overview is not lost and the importance of the event comes across.

 

The Berlin Film Festival started in 1951 and has been celebrated annually in February since 1978. With 230,000 tickets sold and over 430,000 admissions it is considered the largest publicly-attended film festival worldwide. Up to 400 films are shown in several sections, representing a comprehensive array of the cinematic world. Around twenty films competing for the awards called the Golden and Silver Bears.

The Berlin Film Festival is a case in point where the transition from artistic to commercial enterprise can be observed very clearly. It has become for film directors, distribution executives, film studio managers etc. a pad to launch from new projects i.e. by entering the films shown into special distribution networks:

“Berlin has come of age as a sales market, if the way the business is now being conducted is any indicator. Major U.S. sales companies are learning to use the German capital as a launch pad for selected new projects in the way they do the Cannes festival and the American Film Market.”

ALI JAAFAR, PATRICK FRATER(2008) “Berlin Film Festival a market force” in Variety, Feb. 8, 2008 http://www.variety.com/article/VR1117980583.html?categoryid=13&cs=1&nid=2562

Added to that has to be the concept of creating synergies by linking, for instance, the Berlin Film Festival since 2003 with the ‘Berlinale Talent Campus which is a winter school for "up and coming filmmakers" that takes place at the same time as the Festival itself. The Talent Campus accepts about 350 applicants each year; the attendees come from around the world, and represent all of the filmmaking professions.

There are special film festivals such as the one in Gent with focus on music / musical scores accompany the film.

Then, there are festivals which gain over time in reputation due to the hard work of dedicated people who overcome a lot of resistance even by the local authorities who usually try to interfere and most of the times do not realize that artistic concepts need to remain free from all kinds of interventions.

The Kalamata Dance Festival in Kalamata, Greece attracts every year many people from Greece and abroad while at another level are wine festivals or other culinary ones which display local products and are linked very often to traditional arts, music and dance. As research by Budapest Observatory shows, share of local government grant in budget is around 15%. Whether or not this percentage captures as well contributions in kind e.g. making available cultural centre and covering costs of personnel is not specified here. In turn, it says something what cultural resources a city has at its disposition to make possible the holding of a festival. The character changes altogether if the city wishes to promote its own image through such a festival or else wishes to become known through the festival existing within its administrative jurisdiction.

Issues

“Planning and executing a biennial festival entails major risks inherent to this type of event that can only be attenuated through the use of multi-year funding formulas.

• The economic model underpinning festivals such as the FIND and the CDF is crucially affected by two key factors: the impact of the biennial structure and the implications of being event-oriented. The biennial nature of a festival generally creates continuing pressures on the organization’s personnel. These pressures come into play alongside the search for greater visibility and the desire to maintain ongoing relationships with the private sector. These factors explain why the majority of biennial festivals strive at all costs to get their organizations onto a permanent annual cycle. The event-driven nature of such festivals, i.e., the presentation of a series of shows over a very short period,

means that it is almost impossible for a festival to cover the expenses involved in presenting their events (high fees, technical costs, etc).”

Excerpts from the “Financial and Structural

Analysis of the Canada Dance Festival and the

Festival international de nouvelle danse”

http://www.pch.gc.ca/progs/arts/pubs/dance/contemporary_dance_e.pdf

The summary report points out, for example, what good management entails: adapt to changes, ready to take risks, keeping small, medium and large companies together, open to international issues while keeping contact to the local community.

Evaluation and monitoring by local people

Disconnected from local community once a festival becomes too commercialized and people start disbelieving economic success stories claimed. Here a sample of an attempt to give the local community a voice and to participate in more than a mere evaluation even though such public debates will centre around key issues or rather complaints:

Highlights from the discussion at the Town Meeting held in Sidmouth on 14 June 2004, organised by East Devon District Council and Sidmouth Town Council.

Note: if anyone who attended is keen that a point they made be stressed or the emphasis changed, please email me.

Members of the panel were: Cllr. Tony Reed (chairman), Cllr. Ann Liverton, (both Sidmouth Town Council), Cllr. Andrew Moulding (Cllr. at EDDC), Derek Schofield (author of the history of the festival and formerly one of its arena theatre directors), Bill Lankester (Sidmouth businessman and president of Friends of Sidmouth Festival) and Peter Mason (a consultant employed by EDDC and whose report on the festival was still 'under wraps').

The meeting lasted two hours. Although it was primarily for people of the town, a few from outside attended, some from as far away as Kent, keen to give the festival their support. A survey undertaken in the local Sidmouth Herald in the weeks before the meeting produced a 2:1 vote in favour of retaining a festival - in round figures 200 votes for and 100 against, out of a population of around 13,000. The circulation of the Herald is over 7000 copies per week - in two weeks 14,000 forms would have been available to be returned.

According to figures provided by the town council, about 80 people attended, over 60 of whom were from Sidmouth or the immediate locality. The official record of the meeting is here.

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Topics are listed in no particular order of importance. However, it was the strong view that there should be more local involvement, that arranging the 2005 festival was now desperately urgent, that financial support from 'mean spirited' rich local business people should not be essential, and that the festival should not be downsized, or Sidmouth risked losing it completely.

After the meeting closed some well known local supporters of the festival were in gloomy mood - there was little confidence in Councils or councillors. The feeling was that if 2005 could not be made a success, a sizeable event in 2006 might prove impossible to promote successfully. What follows includes some items that are discussed locally in Devon folk clubs but that were not raised specifically at the town meeting. However, there is no conflict in general sentiments.

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LOCAL INVOLVEMENT Many people feel the festival has become too 'disconnected' from local people, and indeed disconnected from local folk groups who in the early days, were instrumental in running what was then a much more local (and smaller) event. Greater involvement by people who live in Sidmouth and the surrounding area was seen as desirable in any future arrangements.

FESTIVAL NOW TOO COMMERCIALISED This is a common complaint in Sidmouth - that the festival gives nothing back to the town and you even have to pay to enter the Arena area. Against this, people recognised the economic realities of running a large festival where commercial rates have to be paid for equipment hire, etc. Much of the ill feeling is generated by the perceived secrecy surrounding the 'festival accounts' and the need for more openness was voiced.

LIFE (AND THE FESTIVAL) IS ABOUT MORE THAN MONEY Bill Lankester made an impassioned plea for the spiritual value of the festival to be recognised - life is not all about money - and his views were echoed by several contributors in the audience. It was felt that if a town as rich as Sidmouth cannot contribute significantly to hosting an event known throughout the world for facilitating cultural exchanges and contacts then it is a 'pretty poor show'. It was thought that many local people simply did not realise what was at stake if the town lost its principal 'claim to fame'.

CLAIMS OF £6 MILLION or £1 MILLION ARE SUSPECT.  Claims that the festival brought variously £1 million or £6 million of extra income to Sidmouth people were thought laughable. Peter Mason agreed that the widely publicised figure of £6 million was based on a limited survey and that the figure had to be treated with care, if not suspicion. The point was made that any future arrangements should proceed from a firm understanding of the festival finances (and its financial benefits to the town). Lack of data was seen as an impediment to serious discussion. The need for proper marginal analysis was mentioned, as was the need to recognise that retained local benefit would be a small part of raw visitor spend. Festival finances are further discussed here.

CANNOT GO BACK TO THE OLD DAYS Several people remembered the old 'Hobby Horse' days and wanted to return to these. This was ruled impracticable if only because any event where adults worked with children required that the staff and volunteers etc, be vetted. Management needed to be accountable. Also, the degree of local support for the festival that was a feature of the local folk scene decades ago may no longer be available and professional organisation was therefore essential.

STEVE HEAP INCORPORATED Many people in Sidmouth refer to the festival as "Steve Heap Incorporated". There is a need both for more transparency in finances and appreciation locally of the huge contribution made by Mr Heap and his team over the past decades. Ill feeling on both sides may need to be addressed. It is recognised also that to have the organisation of the festival so much in the (capable) hands of one or two people who do not live locally is inherently risky. Sidmouth may need to take more control over the festival if only to guard against unforeseen illness, for example. The festival is a large part of "what makes Sidmouth special". To be successful, it must be run by competent and interested people, not by a committee of bureaucrats - local or otherwise.

THE EDDC REPORT MUST BE PUBLISHED In January 2004 EDDC commissioned a report on the future of the festival. Copies were in the hands of councillors but it was not a 'public' document. Many people thought it should be - and told EDDC so in no uncertain terms. If Mr Heap agrees to release of the commercial data it contains then EDDC promised to publish it in full or part form.

URGENCY OF ARRANGING THE 2005 FESTIVAL It was considered important to set in motion arrangements for 2005. Many people feel that in the limited time now available, only Steve Heap could organise a successful event. If Councils and their working parties and committees mess up the 2005 event, the festival may be irrecoverable. There was anger that EDDC had kept so much information secret from local people for months - but it was only in May that the festival issued its press statement. It has been pointed out by the Festival organisers and as a matter of historical record, that the current difficulties were brought to EDDC's attention as far back as 3 years ago. This was at a meeting attended also by Sidmouth Town Council.

WHICH PARTS OF THE FESTIVAL MAKE MONEY? There was some discussion of which parts of the festival make most of the money and that (therefore) might be retained in any downsized future event. The consensus was that the festival is more than the sum of its parts and that if 'loss making' venues or shows were removed the whole spirit could be affected. A small 'core' festival with a few fringe events was not considered to be a viable alternative to what people have come to expect.

WHY DID 2003 NOT PRODUCE A SURPLUS?The question was raised why the splendid weather of 2003 did not produce a surplus to help bolster reserves for 2004 and beyond - surely if the festival did not make a profit in 2003 it could never do so?

IDEAS FOR FINDING £200,000 - actually not a lot of money!  There are probably over 200 millionaires in Sidmouth (and over 2000 if you include the value of their houses?) Many are retired and life is a constant struggle to find things to buy. Rich business people in Sidmouth were described at the meeting as 'tighter than a camel's ??? and owning four or five expensive cars', which is probably one of the more polite descriptions that could be applied to them. If 200 gave £1000 each, the immediate problem would be solved. It was thought more practicable to try to obtain £4 from 50,000 ordinary people, maybe as shareholders. Bill Lankester described how he had once spent a week trying to obtain support from every business in Sidmouth - and with very little to show for it.  Another idea is to offer 'free season tickets for life' to anyone willing to risk £1000 on the condition that every few years you might (or might not) expect to lose the money if it was required to meet wet weather losses. In a run of good years, you might get ten tickets worth £150 each before losing your stake and having to start again with another £1000.

HEALTH AND SAFETY - COMPENSATION CULTURE RUINING LOCAL EVENTS Everything nowadays has to be covered by liability insurance to the extent that even egg and spoon races at village fetes are being cancelled. It is about time our MPs did something useful and reversed the march of the lawyers - but there again, so many of them are lawyers.....Insurance costs for the festival are significant. Some accommodation in school buildings was apparently no longer available to the festival - Health and Safety rules were cited.

CRICKET CLUB PARKING - SIDMOUTH'S WORST SIDE LAID BARE? If true, what was said exposes the nasty side of Sidmouth. For years the Rugby and Cricket clubs in Sidmouth have made money from car parking charges on their land during folk week. It was alleged that one of them had tried to obtain money from the Festival for allowing the ground to be used by festival patrons - in addition to the car parking charges they levied. A member of the audience tried to say this was untrue - but Cllr Tony Reed said he had a letter in his hand to confirm the facts of the case. There was some confusion that it was the rugby club - since the meeting I have been informed it was the cricket club. More details later - perhaps........note added November 2004: I have been told that the Rugby club do give some money to the festival and that this is recorded in their accounts.

POLICING PROBLEMS ARE MINOR - THE FESTIVAL SETS A GOOD EXAMPLE! The Sidmouth festival is valuable as an example of how people can police themselves - there is hardly any trouble and the stewards do a wonderful job. If only all life could be like the first week in August in Sidmouth!

STEVE HEAP DID NOT ATTEND THE MEETING It was explained that Steve Heap had a previous engagement, that he had suffered a family bereavement ten days earlier and that the meeting was primarily for the town itself to discuss what it wanted. Most people accepted this as reasonable.

BENEFITS SPREAD BEYOND SIDMOUTH Income from the festival spreads beyond Sidmouth (but by how much?). Examples were B&B accommodation being used elsewhere in East Devon by people attending the festival. Good data might persuade councillors from outside Sidmouth to invest more EDDC money in the festival - but knowing the true figures might have the opposite effect!

HOW OTHER FESTIVALS OPERATE: SUCCESSFUL ECONOMIC MODELS? Surprise was expressed that there appeared to be no authoritative survey of festivals to show which made or lost money, how they were subsidised, etc. Womad was quoted as making a profit for Reading BC. The organisation of a festival held annually at Maidstone was discussed - it was supported by the local council. The point was made that the Arts Council would not fund the Sidmouth Festival because it was professionally organised as a business.

Source: http://www.seered.co.uk/folk18.htm

Festivals researched
BO is half way towards completing a national survey on cultural festivals. The figures collected from 8 of the biggest ones in Hungary show reassuring similarities with the 80-odd festivals contained in the BAFA report Festivals Mean Business II. Find a few couples of data, some of which show a reverse order than expected:

	Top festivals in Hungary	Top festivals in the UK
Share of local government grant in budget	15.2%	13%
Tickets	34.8%	30%
Share of sponsorship in budget	24.5%	14%
Share of artists and programmes among the expenses	48%	44%
Share of PR and marketing expenses	7%	11%
Share of personnel and organisers' expenses	7%	16%

 

Find a few more curiosities among BO findings. The same top figure occurred in different contexts in two local government budgets: in the town of Szeged 8.1% of the cultural spending went to the summer festival of the city; and 8.1% of the annual revenue in the village of Vigándpetend came from the Valley of arts festival.

Public subsidy ranged from €1.2 to €35.8 per visitor, averaging €6.7. In the final report BO is supposed to judge which figure is better.

http://www.budobs.org/news/memo/memo-november-2004.html

Developments of these festivals are also very interesting as their original more folklore character is usually transformed into business enterprises the more successful they become. In Galway the original free venue was transformed into a permanent institution while business speculated on the fact that ever more visitors were coming to the city due to the festival, but once attracted to the city decided to move to the city on a more permanent basis.

Viable examination – example Ars Victoria: http://www.arts.vic.gov.au/arts/publications/festivalsdiy.htm

To assess the economic impact of a festival or event it is necessary to determine the amount of new expenditure attracted to the region by the festival. This new money is made up of:

• expenditure by festival visitors from outside the region; and

• festival income funded from outside the region and spent within the region.

What Is The Festivals DIY Kit?

The Festivals DIY Kit is a customised Excel-based computer program that involves:

• data entry from a face-to-face survey of festival/event audiences;

• input of festival/event income and expenditure;

• automatic data analysis and calculation of the impact of the festival/event on the regional economy;

• generation of a series of standard reports on visitor origins, visitor expenditure, and festival/event finances.

The Festivals DIY Kit also includes:

• a pro forma questionnaire to be used for the visitor survey, which may be downloaded here as either a PDF or a Word 6.0 document; and

• a guidebook to assist users, which may be downloaded as a PDF.

Using the Festivals DIY Kit

The Festivals DIY Kit has been trialled by a number of Victorian arts festivals, registering local/regional economic impacts ranging from $30,000 to $1.5 million.

Who Should Use the Festivals DIY Kit?

• Festivals and events in regional Victoria which have sufficient (voluntary) resources to manage and conduct a visitor survey

• Melbourne-based festivals and events which attract visitors and expenditure from outside the Melbourne metropolitan area

• Exhibitions in regional Victoria

• Single performances, productions or seasons

The Festivals DIY Kit is not suitable for calculating the economic impact of:

• Events and festivals where the audience is mainly locally based

• Festivals and events outside Victoria, as multipliers used in the kit are Victoria specific

• Ongoing programs and activities

Obtaining the Festivals DIY Kit:

The kit is now available for use free of charge by non-profit festivals/events across Victoria, under a licensing arrangement which acknowledges and protects copyright which is held by the State of Victoria. The Festivals DIY Kit may be obtained using the order form, which can be downloaded in either Word 6.0 or PDF formats .

Support and Training in the Use of the Festivals DIY Kit:

Researchers from the School of Tourism and Hospitality a La Trobe University are assisting in the wider dissemination of the Festivals DIY Kit, and training festival/event organisers in the use of the kit. Support and training covers all aspects of kit usage including managing a visitor survey, data collection and analysis, and interpreting and reporting results of your economic impact study.

Visit the Festivals DIY Kit training and support web site at La Trobe University.

For Further Information
About obtaining the Festivals DIY Kit:

Ms Judy Morton
Tel: (03) 9954 5052
Email: judy.morton@dpc.vic.gov.au

About training and support:
Ms Meg Houghton
Tel: (02) 6058 3851
Email: m.houghton@aw.latrobe.edu.au

 

5.2.2 financial accountability as public body

Here the discussion as to return to chapter 4 and in what critical situation funding of culture finds itself in. On the one hand, public spending on culture is sporadic, inconsistent and subject to cuts whenever the overall budget has reached upper limits and needs to be curtailed. It seems almost an unwritten law that the first cuts are made in culture, health and education. They seem to be areas not clearly represented by a clientel on whose votes the politicians could count on. On the other hand, due to lack of evidence (spending criteria not clearly defined, data missing, various strategies adopted, combination of voluntary and non voluntary work etc.) it seems that ‘financial management’ has to operate in these areas with magical figures, but face up to real costs more often from the non cultural side (workers for setting up an exhibition do not consider themselves to be artists, but are electricians, carpenters, etc. and only public relations managers, ticket sellers, designers of programs and posters etc. could be considered as job categories of the cultural economy but again not identical with artistic people). It leaves at risk all those truly involved in artistic work to be always short changed by all others benefiting off any cultural action.

The term ‘funding’ underlines already one important distinction from investments and other types of governmental financial support measures (and systems) insofar as the arts and cultural activities measure up to something more complex then what the funds entail either directly or indirectly.

Whether such funds are localized or spread over a region or distributed from a national level, they go with setting priorities in view of some distinct structural elements:

• clear actions

• cultural educational measures requiring materials and equipment

• creation of certain activities or outlets e.g. exhibition

• festivals

In each of these structural elements there are ‘hidden costs’ usually not recognized by any formal funding system e.g. conceptualization, networking of people, research, documentation of work in progress etc. Also the way a concrete outcome can be established differs greatly e.g. a theatre performance or an exhibition can take place but what about an action of oral story telling related to what children and the youth do in a particular suburb over a year?

The difficulties of measuring things in terms of financial accountability have led to a reduction of the complexity to what is considered to be concrete in conventional terms. Hence only those costs are recognized which contribute towards making the action possible but it leaves out as a rule payment to the artists and cultural actors. Still, there have been attempts to ‘measure the unmeasurable’ and to bring about a financial accountable system in order to make some substantial conclusions on how the cultural sector is being funded both directly and indirectly over a certain period of time.

The problem of time adds to the difficulties for cultural projects usually do not conform to the necessary accounting times and therefore they exceed as much as they run counter to establishing some certain ratio e.g. so many work hours = so many paintings being produced over time. Once it becomes clear that this is not possible, funding schemes provide grants for travel, rent of ateliers, purchase of materials etc. while giving the artists scholarships over a certain period of time e.g. one month, three months, year etc.

Management systems for accountability

What laws for public spending apply to local bodies?

What authority has the local government with regards to budgetary matters?

• reporting to the Municipal Council

• reporting to the Region

• reporting to the various Ministries at central level, in the case of culture to Ministry of Culture

• cross sectoral expenditures, investments and accounting procedures

What other laws apply which favor the promotion and development of the arts and culture? How distinct is that from promotion and preservation of cultural heritage?

What is the time gap between expenditures planned, decided upon and actually paid out?

What gap exists between old (retention, preservation, keeping up) and trends marking newest developments?

Terms of contracts – securing revenues / returns – if there is a distinction possible between funding and investments – types of partnerships – availability of other funds once public guarantee is given: loan taking activities – payments secured after the action has been completed – time horizon / when project, action or event is completed

Accounting periods and regulations vs. cultural time horizons, degree of complexity and freedom needed from financial constraints: experimentation phase

• different models of financing culture

• impact of other models

• prizes

• scholarships

 

Administration costs – various versions with decentralization and self reliance most important – costs of running a certain program should not exceed by a certain percentage or ratio the overall budget for these and other activities.

Staff requirement: manager, financial accountant, coordinator

Comparative Systems for accountability

France

France is a social and democratic Republic directed by the President. The principal representative bodies are the French National Assembly, the Senate and the Economic and Social Council. The President appoints the Prime Minister, who is responsible for forming the government and whose task it is to define and implement the nation's policies. The government is made up of ministers, each with specific responsibilities, who exercise their authority over the national departments relevant to their portfolios. Within the government, the Minister of Culture and Communication participates in the preparation and implementation of national policies and is specifically responsible for cultural affairs.

The Minister of Culture and Communication exercises political authority over the directorates and other services of the Ministry of Culture and Communication. It is the minister's task to define the overall priorities and guidelines for ministerial initiatives and, accordingly, decides how funds are to be distributed between the directorates and oversees their allocation. The distribution of funds is determined during the drafting of the budget and is subject to the overall guidelines defined by the government. The budget must receive parliamentary approval.

A certain number of other ministries allocate substantial funds to the provision of cultural services: for the education and training of students and for educational museums in the field of history and natural sciences (Ministry of Education and Research); within the framework of public education and animation (Ministry of Health, Youth and Sports), for certain cultural heritage (monuments and museums under the Ministry of Defence), for the export of French culture abroad (Ministry of Foreign Affairs), and for scientific and technical culture (Industry, Agriculture), etc.

Local administration in France is the responsibility of directly elected local authorities (régions, départements and town councils). They are not answerable to the state and, in compliance with the laws of the Republic, are independent of each other. France's devolution laws define each council's scope of activity.

Local authorities - the town councils in particular - are highly active in the cultural field. Town councils manage most local cultural facilities and organise a large number of cultural events in their area (e.g. festivals), partly in cooperation with the Ministry of Culture and Communication.

Source: Compendium – see: http://www.culturalpolicies.net/web/france.php?aid=22

 

UK: fostering a culture of accountability

http://www.joint-reviews.gov.uk/money/Financialmgt/1-26.html

UK experience: Councils need to identify and address the following:

• Ensure consistency between the management arrangements and the underpinning culture of the organisation. If there is a very centralist management structure then the established culture of the organisation needs to be one which reflects this approach where the power to make important decisions will be vested in relatively few individuals. Alternatively, if a decentralised model is preferred, the culture will need to be one of giving responsibility to individuals at different levels in the organisation and holding them to account for performance. A lack of consistency will give rise to tensions within the organisation and confusion about accountability. For example:

  • in a centralised culture, senior managers may inappropriately expect more junior staff to be accountable for the financial decisions they have made and blame them when budgets overspend.

  • in a decentralised structure senior managers may make decisions about spending priorities and wonder why they are not delivered by budget managers lower in the organisation.

• Determine how best to organise and manage the finance function. This may be line managed within Social Services or be part of the corporate team in the finance department. Whichever approach is preferred there are a number of considerations:

  • Finance support staff will have dual accountability; first to the council's Director of Finance for professional standards, financial probity, and other corporate requirements (such as meeting budget preparation and reporting timescales and ensuring the requirements of the council's standing orders and financial regulations are met); second, to the Director of Social Services for the quality and timeliness of the financial information and advice to managers throughout the organisation.

  • Whoever has the direct line management responsibility will need to ensure that both sets of accountabilities are being delivered satisfactorily (ideally by engaging effectively with the other Director), and to recognise the potentially inbuilt tensions for the finance staff of having this dual accountability.

  • Whoever has direct line management responsibility will need to ensure that the staff are sufficiently skilled and developed to deliver both sets of accountabilities.

  • The need for a 'common language' so that finance staff understand the service area they are working with, and that staff in those service areas understand financial terminology and expectations.

The underpinning accountabilities that need to be in place to make the arrangements work well are much more significant than the management arrangements. The following examples from Joint Reviews illustrate this:

CASE STUDIES The finance support team for social services - management and reporting arrangements Authority A A is a 'unitary' authority which has had balanced budgets in Social Services in its relatively short history. Unexpectedly, a significant overspend occurred which was not identified until the end of the financial year. There were a number of contributing factors which gave rise to this position, including problems with the centrally based finance support team and lack of effective engagement of these staff with colleagues in Social Services. Among a number of responses made by the Authority to tackle the problem, and ensure that similar occurrences do not happen in the future, was a decision to change the management arrangements so that the finance support team came under the line management of the Director of Social Services. Authority B B is a London Borough which had experienced significant budget overspends in Social Services over a period of 3 years. A range of issues were identified as contributing to the problem, including the lack of direct accountability for financial issues to the Director of Finance. Among a number of responses made by the Authority to tackle the problem was a decision to place the line management responsibility for the Social Services finance support team with the Director of Finance.

Decision-making structures

Clear decision-making structures need to be identified which include decisions about casework, agreeing care plans, the commissioning of services to deliver care plans, and approving expenditure (including the allocation of resources) to meet the cost of the services. These are normally outlined in a 'scheme of delegation' which will apply to the authority as a whole or specifically to the social services function - Good Practice Example: Lincolnshire County Council - Changing roles in financial reporting - Good Practice Example: Lincolnshire County Council - Clarifying Management Roles.

Staffing - knowledge and skill base

Sound financial management requires skilled and competent staff at all levels of the organisation. Too frequently expectations of staff are not made clear, nor do they have the skills to perform these vital roles (read more).

The following need to be in place to ensure that the staff are effective:

• Job specifications need to be precise about accountabilities for financial planning and budget management. Generalised statements such as "responsible for managing the care budget for the team" are not sufficiently clear about expectations.

• The competencies expected of post holders to enable them to perform the tasks outlined in the specification need to be clearly articulated.

• The specifications and competencies of finance staff and social services managers should complement each other. This needs to include a broad understanding of each other's roles and the context in which they work. For example, managers need to have an understanding of accounting practice, financial forecasting, and corporate expectations for financial planning, budget setting, budget reporting, financial regulations etc. Finance support staff need to have a broad understanding of national priorities for social services, current performance against these in the authority, local priorities for service change and development and anticipated changes in demand patterns for services.

• A training plan which addresses the training needs of social services managers and finance support staff to ensure they have the 'competencies' to fulfil their roles effectively. This must include being able to respond quickly to the needs of staff who are new to these roles. Read more Wigan Social Services has developed a modular training and awareness programme to support staff managing devolved budgets.

• A performance system which monitors the effectiveness of staff in delivering the tasks outlined in the job specifications in ways which are measurable, and reports regularly. For example (relating to finance support staff), whether budget reporting timescales have been met, whether the information to support budget management is accurate and timely, and whether budget managers have been engaged in confirming budget forecasts.

• A performance appraisal system which systematically gathers information about performance outcomes and addresses issues about the skills of staff to undertake the tasks identified in the job specifications and 'core competencies' on a regular basis (at least annually).

• A system to link the outcomes from the staff appraisal process back into the development of the training plan and training programmes.

Greece

Greece lacks a transparent information system to know where EU funds go.

Over the period 2004 – 2007 the Ministry has been run mainly by the General Secretary Zachoupolous and therefore below the political radar screen. After his attempt to commit suicide, numerous questions have arisen how both the EU funds and the money obtained from football lotto have been administered. It is alleged that 12 000 employees have been paid an extra 48,8 Million from an extra account to increase the usual low salaries of civil servants. Even former ministers of culture justify this as an unbureaucratic payment procedure. Also Venizelos, former Minister of Culture when PASOK was still in power, is alleged to have given special funds to the trade unions which organise workers within the sphere of culture and related institutions.

National definition of culture

There is no official definition of culture in government policy documents. The Greek Constitution makes, however, indirect reference to culture, in that it recognises the freedom of artistic expression, and determines that the state has the obligation to support the development and promotion of artistic creativity, to protect the cultural (manmade) environment, including monuments and the regions and vestiges of heritage. Responsibilities of the Ministry of Culture, as stated in its organisational statutes, include the protection and valorisation of cultural heritage (including archaeology and folk culture), of creators in the arts and letters (including the fine and visual arts, theatre, dance, cinema, music, and literature) and their intellectual property rights, of artistic education, of local cultures and cultural diversity, of international cultural exchange and co-operation, and of access to cultural production for all: this gives light, by enumeration, to a functional definition of culture in the Greek context.

In policy documents and current debates, the coined word politismos is used to the exclusion of other terms in order to subsume the meaning of foreign terms such as culture (and its French and German cognates, with their differing meanings), civilisation, or arts and letters (the "high" culture). Cultural heritage holds a central place in this definition. A broader definition of culture, used increasingly in policy documents during the last decade, addresses cultural heritage and all manifestations of literary and artistic creativity from prehistory to contemporary times, as well as values and behavioural patterns congruent with the promotion of creativity and free access to artistic and literary production. Even so, culture is not understood as a value-neutral concept, and its pursuit stands in opposition with "easy" entertainment, leisure, advertising, the media, and what is defined in other countries as the "cultural industries".

Culture industries: developments, programmes and partnerships

The state continues to be the primary sponsor of culture. Privatisation of cultural infrastructure and organisations is not part of the current policy priorities. Private sponsorship of the arts decreased after an early 90s tax exemption was withdrawn (in 1997). New measures being considered include: schemes involving a few banks and multinationals supporting blockbuster events produced by large-scale national institutions in the arts; new regulations on sponsorship activities; other types of incentives.

Constrained by limited funding, the Ministry of Culture has focussed support for the culture industries through sector organisations and the rationalisation of funding initiatives. Thus, the National Book Centre is the main vehicle of support for Greek books, and has recently engaged in a broad-ranging programme of subsidised translations and other activities to promote Greek literature. The Greek Film Centre now supports the annual production of a significant number of Greek films. Independent (private) theatre companies are supported by a subsidy scheme, which was recently rationalised to follow a more consistent set of criteria on artistic contributions and past performance.

The main thrust of cultural policy in recent years, however, concerns the integration and synergy between cultural heritage and cultural action, between the state and local government, and between centre and periphery, a policy manifested initially in the National Cultural Network of Cities and now in the Domain of Culture programme (see also chapter 2.2).

6.1 Short overview

While only 0.35% of the ordinary public budget of the Greek state is allocated to the Ministry of Culture, significant additional funds are available through the lottery schemes administered by the Ministry of Culture, as well as in the context of EU-supported programmes such as Culture 2000 and the Information Society programme. This does not include spending on cultural activities channelled through the budget of the Ministry of Education and Religious Affairs, local government, the public Radio and Television Corporation, and other agencies not under the authority of the Ministry of Culture.

Average yearly household spending on "culture and leisure" in 1999 was 816.07 euros amounting to 4.92% of overall household spending. Direct culture spending amounts to a smaller percentage, i.e. 1.29% for "cultural and leisure services" (including sports and games, apart from attendance in the arts), and 1.57% for purchases of "newspapers, books and stationery".

6.2 Public cultural expenditure per capita

Public expenditure on culture (as indicated by general government expenditure in the cultural sector divided by total population) per capita in 2001 was 37.56 euros. It corresponded to 0.32% of the GDP.

These figures are based only on expenditures channelled through the Ministry of Culture budget, i.e. they exclude cultural spending of local government and other government Ministries.

6.3 Public cultural expenditure broken down by level of government Table 1:     Public cultural expenditure: by level of government in euros, 2001 Level of government Total expenditure % share of total State 411 857 000 (1)   Regional N/A (2)   Local N/A   Total   100% Sources: 1.  Ordinary public budget and public investment budget of the Hellenic Republic, 2001. 2.  Operational Programme "Culture", Planning Appendix, 3rd Framework programme, Ministry of Culture. 3.  Press Release of the Ministry of Culture: Evangelos Venizelos, Opening speech, 2nd meeting of the Monitoring Committee of the Operational Programme "Culture", 26 June 2002. 4.  Press Release of the Ministry of Culture: Presentation of the Operational Programme of the Ministry of Culture in the context of "Information Society", 19 June 2002. 5.  Cultural sector: general government expenditure etc., years 1998-2001, internal report, Ministry of Culture. (1)     Apart from the ordinary state and public investment budget of the Ministry of Culture, amounting to 195 328 000 euros, an additional 216 529 000 euros was allocated to culture and the arts in 2001 from the following sources: 85 569 000 euros from public lotteries, 119 500 000 euros from European Union funds, and 11 460 000 euros from income of the Archaeological Receipts Fund. (2)     In the seven year period 2000-2006, European Union funds allocated to culture through regional administration is estimated to 558 million euros from the Regional Operational Programmes plus 73 million euros from INTERREG, a mean value of ca. 90 million per year. This is exclusive of cultural funds at the regional level from the ordinary budget.

6.4 Sector breakdown Table 2:     Public cultural expenditure: by sector in thousand euro, 2001 Field Total % share of total 1. Museums and archives 198 018 62.2 2. Monuments and sites 3. Literature 6 394 2.0 4. Libraries n.a. n.a. 5. Press n.a. n.a. 6. Music 35 044 11.0 7. Performing arts 21 589 6.8 8. Visual arts 5 374 1.7 9. Film / cinema / photography / video 11 392 3.6 10. Radio / television n.a. n.a. 11. Socio-cultural activities 9 974 3.1 12. Expenditure on cultural activities abroad n.a. n.a. 13. Education and training n.a. n.a. 14. Others 30 464 9.57 Total 318 249 100 Source:    Cultural sector: general government expenditure,1998-2001, Internal Report, Ministry of Culture. Note:       Wage and salary costs for Ministry of Culture staff is an additional 94.7 million euros. Funding in "Others" may include support for municipal public libraries and cultural activities abroad funded by the Ministry of Culture. The budget of the Hellenic Radio and Television Corporation is ca. 205 million euros, but it is unclear how much of this budget is allocated to cultural programming. 2001 investments from the Community Framework Programme for Culture indicates a further 12.9 million euros for visual and performing arts and 14.3 million euros for cultural centres, not included in the above data; the same programme in 2001 supported museums with 24.1 million euros and archaeological sites with 20.7 million euros

 

7.1 Re-allocation of public responsibilities

There has not been a direct re-allocation of public responsibilities for culture to the private sector. The Greek approach to decentralisation / privatisation has been based, firstly, on the establishment and strengthening of the role of organisations operating under the arms-length principle and, secondly, on the transfer of funding and operational responsibilities for arts development to local government. Except for works in archaeological sites and museums, which remain under the direct control of the Ministry exercised through the archaeological service, most other construction works and operational programmes relating to culture (such as the organisation of festivals) are now controlled and funded by regional administration and local government.

7.2 Status/role and development of major cultural institutions

The main organisational shift in the management of the arts in Greece consists of the strengthening of organisations operating under the arms-length principle. Sectoral organisations, such as the National Book Centre are controlled by the state through the direct appointment of their Board of Directors by the Minister of Culture, but receive a separate budget which they can manage without state intervention according to their established goals and action plan. Local arts organisations are typically established by municipalities, and receive funding by both the local government and the Ministry of Culture, under a matching funds principle, which they spend according to the terms of tripartite programmatic agreements; their Boards are appointed by the local government authority, with the exception of one non-executive Director appointed by the Ministry of Culture. Most of these organisations have the status of companies or foundations in private law, which affords them relative flexibility in staffing, financial management and operations.

Several archaeological museums and art galleries of special status recently received increased autonomy by the central service of the Ministry of Culture, although they are still staffed by Ministry officials and receive their budget from the state. This status allows them to have their own budget and specialised staff, to engage in their own planning and programming and, in some cases, to manage funds derived from own sales.

7.3 Emerging partnerships or collaborations Private patronage in the arts has had a significant impact on Greek cultural development during the last quarter century, consisting both in the establishment of new institutions and in the provision of essential support for large scale cultural events. Notable examples of institutions established with private patronage include the Goulandris Museum of Natural History, the Cycladic Art Museum, the Greek Literary and Historical Archive, the DESTE Foundation of Contemporary Art, the Goulandris Museum of Modern Art on the island of Andros, and the Foundation of the Hellenic World. An important art gallery was established in Thessaloniki following the state acquisition of the private Kostakis collection, a very important early 20th century art collection. Blockbuster events during the last decade, such as the Glory of Byzantium exhibition in the Metropolitan Museum of Art would not have been possible without the patronage of not-for-profit foundations, notably the Alexandros A. Onassis Foundation. Perhaps the most notable example of private-public co-operation concerns the Athens Concert Hall. The initiative and initial funds of the Society of the Friends of Music, an association of affluent supporters of classical music, led, after two decades of effort, to the establishment of the Athens Concert Hall. It is the first facility providing state-of-the-art conditions for the performance and recording of concert music in Greece. The Athens Concert Hall has been established as an independent foundation, with members of the Board of Directors appointed both by the state and by the Society of the Friends of Music. Its yearly programme is supported by a large state subsidy. These initiatives and partnerships have been established as the result of the commitment by individuals - people working for the Ministry of Culture who saw an opportunity to support a good cause, or patrons who had a collection or asset and wished to make it available to the public - and not as the outcome of an established policy. Recent legislation on private art collections and museums, makes an effort to regulate more consistently the terms under which these collections and museums are established, run and supported by the state; we have to wait and see what impact it will have on patronage and co-operation between donors and the state.

 

 

Greece/ 8. Support to creativity and participation 8.1 Direct and indirect support to artists There is indirect, rather than direct, support by the state for literary and artistic creativity. In the case of literature, these take the form of bulk purchasing of literary works by the Ministry of Culture. In the case of photography, the Ministry co-operates with private galleries to support the "photography month", providing an opportunity for the sale of photographic work. In addition, there is an obligatory 1% of the budget of public buildings to be allocated to the acquisition of art works. The Ministry of Culture has established a universal honorary pension scheme for recognised writers and artists, however, the pensions given through this scheme are very meagre, and the scheme is currently being evaluated. Law 2557/97 makes indirect provisions for a number of issues relevant to the promotion of creativity and the role of creators, from literary, dance and drama prizes to the creation of galleries or art, education in the performing arts, and support for artistic and cultural associations.

 

According to Compendium, the Ministry of Culture is organized in a way that gives leading personalities a greater say in obtaining funds, taking over specific initiatives or when it comes to put a mark on certain key events (summer festival at Herodeon, or Cultural Olympiade, participation of Greece in Beijing for the Olympics 2008 etc.) because these ‘big names’ play a role in how connections are made, money transferred and what insiders do on behalf of their patrons who have helped them obtain the jobs e.g. advisor for culture to the mayor of Athens who was the former doctor of Melina Mercouri and therefore has good contacts to Spyros Mercouris who made sure that the former coordinator of the ECCM (European Capital of Culture) network, Rodolfo Maslias becomes his advisor. This positioning reflects a strategic way of having influence over public affairs. It is resonated by a general belief in the public that without connections you do not get anywhere in terms of jobs, contracts and funds. This kind of favouritism and clienteles makes it impossible for good talents to be recognized and promoted on virtue of their own personalities and abilities. The fear of intrigues and of other possible mishaps leaves everyone at the mercy of the cultural elite who have linked successfully their names to the cultural heritage of Greece and are more often the ambassadors abroad, even though they have done little to strengthen the cultural consensus within the country.

Minister agrees with European Agenda for Culture while outlining overall spending priorities for the Greek Ministry of Culture:

Greek Culture Minister Mihalis Liapis on Friday said that Athens was in favour of creating a common European agenda for culture during his participation in a meeting of EU culture ministers held in Brussels.

In an announcement issued after the meeting, Liapis stressed that culture should be among the priorities of the European Union and be the object of a coordinated and joint policy by the 27 EU member-states.

Among proposals made by the Greek minister was creating a digital record of cultural assets and setting up a European communications network to promote cooperation and exchange of best practices, while he also highlighted the "economy of culture" and stressed the need to EU financial support small and middle-sized bodies engaging in cultural activities and were important in local communities.

Liapis additionally stressed the need to include training in the arts and culture at all levels of education and to promote vocational training courses for culture-sector professionals, in order to improve the human resources that would help culture and the artistic sector develop further.

A final reference was to the construction and operation of the New Acropolis Museum in Athens, which will henceforth house the antiquities from the Parthenon and other Acropolis monuments, with Liapis stressing that this form part of the framework for promoting European Cultural Heritage and inviting his counterparts to visit the Museum in the coming months.
http://www.ana.gr/anaweb/user/showplain?maindoc=5888822&maindocimg=4802453&service=102

Controversial funding

Kathiremini

8 January 2008

http://www.ekathimerini.com/4dcgi/_w_articles_columns_100022_08/01/2008_91855

A review of the Culture Ministry’s subsidies says nothing about the country’s culture policy over time. What it does reveal on the other hand is the culture minister’s hometown or electoral district. The subsidies from the ministry do not follow any steady pattern; however, much of the money goes to anything from churches to local communities in that same geographical area. People in the know have a lot to say about those who managed the ministry’s finances, regardless of the government in office. The ministry funds do not go into culture; rather, they are used to garner votes. It’s time the state enhanced accountability over the spending of the ministry’s subsidies. The conservative administration which was elected made pledges to impose transparency across the political system, and it has an obligation to report and justify its funding decisions. The government must abolish these special accounts as no one knows who or what is funded, or based on what criteria. Above all, the government must re-examine controversial subsidies. It must correct rather than repeat the mistakes it slammed when it was in the opposition.

PM briefed by Culture Minister 14.8.08

http://www.ana.gr/anaweb/user/showplain?maindoc=6292783&maindocimg=5087905&service=6

Prime minister Costas Karamanlis conferred on Monday with Culture Minister Michalis Liapis, who said in reply to press questions afterwards that the ministry was formulating a new strategy for rationalisation of expenditures, while subsidisations by the ministry would be founded on the criterion of the interests of culture, and not on petty political party expediencies.

"Everything will be assessed and checked. There is transparency, all the decisions will be made public, and all the discussions in the ministry's institutional bodies will be open to the press," Liapis said.

He said that the ministry could emerge strengthened from its recent crisis, and in this direction the infamous 'special account' was being abolished. Beginning with the new ministry budget, all the expenditures would be contained in the state budget, so that there could be daily checks, Liapis explained.

The goal, he continued, was to strengthen the cultural heritage as well as contemporary culture.

Liapis further announced that parliament was due to vote on a bill under which a managerial authority would be set up at the ministry, enabling it to participate in the 4th Community Support Framework (CSF), which meant that, for the next five years, the ministry would have the ability to make cultural investments with EU funds.

He described this as a "great success", given that the relevant amendment had been a demand of all the political forces.

Liapis said he also discussed the ministry's finances with the prime minister, given that "culture requires money", and added that the ministry has the undivided backing and willingness on the part of the premier, within the framework of the country's fiscal policy, for its financial support.

The minister said he also briefed Karamanlis on sports issues, and chiefly a bill aimed at curbing violence on the sports fields, which would be discussed by parliament in the next few days.

Orchestra funding hits bad note July 15 Kathimerini http://www.ekathimerini.com/4dcgi/_w_articles_politics_100008_15/07/2008_98592 Composer Stavros Xarchakos yesterday launched a strong attack on the government and the way that Greece funds the arts as he revealed that the State Orchestra for Greek Music (KOEM), which he conducts, is on the verge of financial ruin. Xarchakos called a press conference to inform journalists that KOEM owes some 2 million euros and that its musicians have not been paid since October. The celebrated 69-year-old composer and conductor claimed that the Finance Ministry had earmarked 2 million euros for the orchestra last October but the Culture Ministry used this money for other purposes. “We have read recently that, with the approval of both main parties, money that was destined for investment in culture was instead spent on bonuses for [Culture] ministry staff,” said Xarchakos in reference to a report submitted to Parliament by prosecutors last week. “But the amazing thing is that all the culture ministers rushed to confirm this, rather than see it as a scandal.” The composer, who has represented the ruling New Democracy party in the European and Greek parliaments, said that a lack of state funding for the arts means that “culture becomes a matter for private sponsors and their choices.” Xarchakos, who has been conducting KOEM since 1994, blasted culture ministers for “believing that cultural policy consists solely of fulfilling personal desires, dividing up the state pie... and developing patron-client ties that offer them personal, financial or political gains.” Xarchakos was flanked by several notable figures from Greece’s musical scene, who backed his argument. “The Culture Ministry might not have all the money in the world but it should carefully consider how it spends funds,” said composer and former Culture Minister Thanos Mikroutsikos.

The Greek cultural industry has run out of money: how can there be a second chance…

http://www.knowhow.gr/echome.asp?p=1288

Ιούλιος 22, 2008

Delos is, for all senses and purposes, closed to the public, as Kathimerini wrote. Akrotiri in Santorini has been closed for 3 years now, due to the cover problems and, as Alpha TV showed, the situation there is shameful. All these could be considered as easy opposition criticism, if there weren’t officials from the Ministry of Culture who expressed their disappointment: big deficits, hidden debts from years past, things that are slowly being uncovered…

The employees’ wages take up almost the sum total of the Ministry’s budget. Also it must be taken into account that, since Evaggelos Venizelos was Minister of Culture, every year almost 20 million euros is being paid to the workers union, which, in turn, shares it to the employees as overtime or bonuses… There are other details, that the Ministry’s officials let drop. The point is that the Greek cultural industry is «bankrupt»: it doesn’t have the budget to make basic investments that would have immediate effect, e.g. that Delos archaeological site would be open to tourists after 2 p.m.

Greece’s performance very low

An elegant tome, called «Culture Workbooks», an idea of the former Secretary General of the Ministry of Culture, Christos Zahopoulos and his ex-colleague, Evi Tsekou, is of special interest. Presenting the minutiae of a symposium, it contains the proposition of the PM’S former consultant and professor of the Economic University of Athens, Mrs. Eleni Louri. This proposition contains two lists that clearly paint the picture of Greece’s failure in the sector of cultural industry: the first one is about culture’s contribution in the national economy. Greece is 15^th, below Finland, Denmark, Sweden, the Netherlands, Poland (!), Ireland… In Greece, culture contributes only 1% of the GNP. The other list is concerned with the employment in the cultural sector. Greece, being known for its great performance in the sector of «jobbery», takes the 9^th place, with 3,2%, a percentage much bigger than the percentage of cultural industry in the GNP.

Vissi, Gagatsis, the Mediterranean Games & Delos

Officials of the Ministry of Culture have made some analyses, which show clearly the deficiencies and weaknesses of Greece’s cultural industry. It is an accepted fact that Greece has a great potential in this sector and that with a minimal investment, its performance would be very good. But, the Ministry’s leadership won’t be able to negotiate the acquisition of the necessary resources, while the Greek political system is mainly concerned with the «Siemens case» and the other judicial cases («Germanos», et al).

The Greek government doesn’t have infinite resources, to be able to invest substantial funds on culture. But, at the same time, ample funding is going:

- to the support of Greece’s Eurovision contestants. The Greek consulate in Milan complained because it had been pushed to invest all its funds intended for cultural promotion in Italy to support Anna Vissi’s candidacy at the Eurovision contest.

- to the financing of football. Greek Football Association (ΕΠΟ) president Vasilis Gagatsis manages a lot of funding, in the name of the Greek national football team, which everyone knows how it fared during the last Euro.

- to the «sponsorship» -sometimes supported by politicians…- of many football teams, that, although their administration is «foggy», they are capable of doing costly transfers of players and present a significant budget.

-to the Mediterranean Games of 2011: their mounting seems to approach that of the 2004 Olympic Games, although their significance is quite minimal.

The government, but also the opposition, has to make a choice: either they’ll support Vissi and Gagatsis, or they’ll invest on Delos and Santorini. The national budget cannot support both…

Greece has a second chance

The situation is anything but felicitous, but Greece has the «luxury» of trying to redeploy its cultural industry. Its «assets» are quite important. Combining Culture with Tourism, something that today is done minimally, is sine qua non. Also, considering that this «restructuring» will take at least five years, everyone should chip in to accelerate this process.

a) The Prime Minister Kostas Karamanlis, who has also been Minister of Culture, could work out a couple of motions to accelerate this restructuring and send the message of the government’s determination.

b) Mr. George Papandreou, president of the opposition (PaSoK) could apply pressure towards this goal by presenting a concise program of four or five points.

c) Mr. Alekos Alavanos, with his authority among the Greek citizens, could show some gravitas towards Culture, an area in which he has to show important family performance (e.g. his daughter has been awarded with the prestigious DESTE award for new painters). Also, Mr Alexis Tsipras could understand that culture could be an area in which his party can take a leading role and in which it can add a lot of positive proposals.

d) A lot of Greek citizens could add in the whole process, if they explained to their children that our cultural heritage is not just «some relics, where foreign tourists go and we take their money». In the end, our cultural reserve is the only asset that the next generation of Greeks will inherit…

*the photo comes from flickr.com*

A ministry’s artless posturing 22.July 2008

http://www.ekathimerini.com/4dcgi/_w_articles_columns_100016_22/07/2008_98800

The repeated cancellation of big arts productions gives an indication of the Culture Ministry’s future course.

The ministry has stopped the release of funds for cultural events; it has failed to pay back outstanding debts from last year’s program; it sees no obligation to answer to outside criticism; it does not meet its obligations and it is pushing various festivals toward extinction.

Ministry officials see no need to offer any explanation – or at least admit that there is no money in the ministry coffers. As a result, well-established and popular events, such as the Kalamata Dance Festival or the Babel Comics Festival in Athens, are in danger since the ministry has decided to freeze its accounts following the case of former Culture Ministry general secretary Christos Zachopoulos.

Michalis Liapis, a politician with rich experience in the growth of railways, trams and aircraft, ought to give an explanation as culture minister. Will the state respect the contracts and agreements it has signed? Or will it behave like a bankrupt producer, shying away from phone calls and the least of its responsibilities?

Compendium Overview for Greece:

Overall responsibility for policy in the fields of cultural heritage and the arts lies with the Ministry of Culture. Sport is also under the Ministry's jurisdiction, supervised by a separate Undersecretary for Sport.

On constitutional grounds, the Greek Parliament has a key role in cultural affairs, notably, passing legislation on issues pertaining to cultural heritage and the arts, which are introduced by the Minister of Culture. In addition, its Standing Committee for Culture and Education has an important role in supervising the implementation of policies and programmes of the Ministry of Culture and its agencies; issues relevant to foreign cultural policy, on the other hand, are addressed via the Standing Committee on Greeks Abroad or the External Affairs Standing Committee of Parliament.

Several ministries and government departments play a key role in the development and implementation of policies and programmes for culture, the arts and media including:

• Ministry of Press;

• Ministry of Culture and the Ministry of the Environment, Planning and Public Works are jointly responsible for the protection of the architectural and natural heritage;

• Ministry of Foreign Affairs (certain instruments pertaining to foreign cultural policy);

• General Secretariat for Greeks Abroad;

• Ministry of Education and Religious Affairs (with departments responsible for various religious denominations);

• General Secretariats: for Lifelong Learning, and for Youth;

• Administrative Divisions: for Greeks Abroad and Multicultural Education; and, for Instructional Media, Educational Radio and Television, Public Libraries and Archives

The Ministry of Culture consists of four General Directorates: Antiquities and Cultural Heritage; Restoration, Museums and Technical Works; Contemporary Culture; and, Administrative Support (which includes the Directorates of European Union and of International Relations). Together they have collective responsibility for the:

• preparation and implementation of legislation;

• the definition and implementation of the regulatory framework;

• strategic planning, programming, funding;

• programmes and activities in the fields of cultural heritage preservation and valorisation (including archaeology, museums, and folk culture); and

• preparing sector policies for books, literature, the visual arts (including photography, design, and digital media), cinematography, music, theatre, dance, and performing arts in general.

The Ministry of Culture is assisted in the preparation, planning, funding, control and / or implementation of policy by consultative bodies, such as the National Commission of Museums, and by arms-length agencies, such as the National Book Centre, the Greek Cinema Centre, the Fund of Credits Management for Archaeological Work, the Hellenic Culture Organisation SA, the Hellenic Intellectual Property Organisation, and the newly founded Centre for Theatre and Dance. The membership of these consultative bodies and the governing bodies of arms-length organisations are appointed by the Minister of Culture, with only some positions filled by ex officio representatives from the sector (different to the British or Nordic models of arms-length). Some of these bodies enjoy a considerable degree of autonomy from political power, mainly on account of the status of their chairperson and board members.

The Ministry has set up special departments responsible for cultural heritage protection: the Ephorate of Underwater Antiquities, the Ephorate of Private Collections, the Service for the Restoration of the Acropolis Monuments. In addition, a number of archaeological museums were given special regional service status (National Archaeological; Epigraphical; Numismatic; Byzantine; Archaeological Museum of Heraklion; Archaeological Museum of Thessaloniki; Museum of Byzantine Culture of Thessaloniki). In addition, several regional services of the Ministry of Culture are responsible for the on-site implementation of policies on the protection, preservation and valorisation of archaeological heritage, namely, 25 Ephorates of Prehistoric and Classical Antiquities, 14 Ephorates of Byzantine and Post-Byzantine Antiquities, and 8 Ephorates of Contemporary and Modern Monuments.

Several major public museums and galleries operate at arms-length from the Ministry despite being almost fully dependent on central government funding. These include: the National Gallery-Alexandros Soutzos Museum; and the National Museum of Contemporary Art in Athens; and the State Museum of Contemporary Art in Thessaloniki. Some not-for-profit foundations or associations, such as the Benaki Museum, the Museum of Cycladic Art, the Macedonian Centre of Contemporary Art in Thessaloniki, and the Foundation of the Hellenic World, play an important complementary role.

The Ministry of Culture provides support for regional cultural development and the arts via its arms-length sector bodies. Many regional theatre organisations, municipal cinemas, cultural centres and other similar organisations are co-funded by the Ministry of Culture, and operate under the long-term programme agreements between the municipalities and the Ministry. As a rule, such organisations operate as agencies of local government, under its effective administrative control. However, a large number of independent folk art, ethnographic, applied arts or local history museums are financially supported by the Ministry of Culture.

Current policies are based on an attempt to re-adjust the balance between the national and local-regional level, mostly on the basis of nationwide sectoral initiatives in the arts and cultural heritage. The focus of recent policy intervention as regards the governance of culture is in mobilising established figures from the field of the arts to lead cultural institutions and initiatives, and in increasing the reliance of the Ministry of Culture on quasi-foundation status, arms-length organisations or consultative bodies for the elaboration and implementation of sectoral policies.

Source: Compendium - http://www.culturalpolicies.net/web/greece.php?aid=22

 

CULTURAL CONTACT POINT

http://www.ccp.culture.gr/

The Cultural Contact Point has not updated its website from 2007 in 2008.

May 2008

The Cultural Contact Point in Greece does not organise seminars, however we plan individual meetings with the cultural bodies interested to participate in Culture Programme  Programme, or other funding programmes. We have an official website, but due to many tasks for the Year of Intercultural Dialogue we haven't updated it fpr long time. We can arrange a meeting in order to discuss your organisation's activities and see how we can help you to join relevant programmes for funding.

At your disposal,

Eva Karanikola

According to the claim laid down by the General Directorate for Education and Culture every Member State has to set up a relay of information called hereinafter Cultural Contact Point, whose role consists of informing the European citizens about the European Cultural activity, and principally about the “Culture” Programme.

The task of the cultural contact points shall be to:

-                 promote the Programme,

-                 facilitate access to the Programme for, and encourage participation in its activities by, as many professionals and operators in the cultural field as possible, by means of an effective dissemination of information and by developing appropriate networking initiatives between themselves;

-                 provide an efficient link with the various institutions providing aid to the cultural sector in the Member States, thus contributing to complementarity between the measures taken under the Programme and national support measures;

-                 provide information on other Community programmes open for cultural projects if required.

Activities for 2007 – 2008

Participation of Cultural Contact Point at the exhibition “POLIS 2007”

The Cultural Contact Point of Greece, will participate with his own booth in the 6th International Exhibition, “Local Government, Public and Social Sector and Private Enterprises POLIS 2007”, which will be take place in the exhibition center of HELEXPO in Thessaloniki from November 22-25, 2007.

The kiosk of Cultural Contact Point will function as point of information for the Program “Culture 2007-2013”.

“POLIS” exhibition has been recorded as particularly important event for the Local Government, Public Sector and the Private Enterprises and covers already, with particular claims, her fifth period of operation. In the frame of the exhibition are organised parallel events with the participation of Local Government, Public Sector and Private Enterprises that attract the interest of the constructional and technical companies with the projection of products, services and activities, as well as the public interest for institutions actions and amplification of communication channels between them.

 

Main aim of the participation of Cultural Contact Point of Greece in exhibition “POLIS 2007” is the briefing of Local Government at the Program and the support that it offers in cultural work of transnational collaboration and mobility that props up the common European cultural identity, as well as the presentation of various ways of participation in European economical subsidised programs with main activity in the cultural sector.

GRANTS AWARDED IN 2007 BY DG COMM

REPRESENTATION: ATHENS

Project	Address	EU funding in 2007	Percentage of total budget
EL-1 ANAPTYXIAKI FLORINAS	26, rue St. Dragoumi- 53100FLORINA	17.000,00	37,363%
EL-2 ANAPTYXIAKI DODEKANISSOU SA	72, rue 28 Oktovriou- 85100 RODOS	15.000,00	44,885%
EL-3 ANAPTYXIAKI ETERIA ANATOLIKIS MAKEDONIAS & THRAKIS SA	74, rue Mihail Karaoli- 67100 XANTHI	20.000,00	47,616%
EL-4 AGROTIKI SINETERISTIKI IPIROU-KERKIRAS SA	38, rue Harilaou Trikoupi- 45332 IOANNINA	20.000,00	38,817%
EL-5 EPIMELITIRIO MESSINIAS	Platia 23e Martiou- 24100 KALAMATA	17.000,00	50,000%
EL-6 PERIFERIA STEREAS ELLADAS & DIMOU LAMIEON	Platia Eleftherias 8 -35100 LAMIA	22.000,00	16,845%
EL-7 ORGANISMOS ANAPTYXIS DITIKIS KRITIS	40, rue Kriari-73135 HANIA	18.000,00	40,000%
EL-8 DIMOS ATHINEON	61-63, rue Athinas-10552 ATHINA	16.000,00	17,978%
EL-9 ANAPTYXIAKI EPARHIA NAXOU-ARIADNI	SA Kerami Halkiou-84300 NAXOS	20.000,00	32,289%
EL-10 ANAPTYXIAKI KARDITSAS SA	Allamani & Blatsouka-43100 KARDITSA	18.000,00	43,796%
EL-11 GEORGIKI & VIOTECHNIKI SHOLI THESSALONIKIS	12,rue Marinou Antipa-55102 THESSALONIKI	18.000,00	30,000%
EL-12 ANAPTYXIAKOS SINDESMOS DITIKIS ATHINAS	65, rue Ethnikis Antistasseos- 12134 PERISTERI	15.000,00	21,946%
Total		324.000.00

Critical questions for EU funded projects in Greece during 2007:

1. What was the overall allocation of EU funds for Greece?

2. Are the amounts listed one year projects or for what time period are these resource allocations meant for?

3. what is the time gap between application, announcement of positive decision and real payments made compared to the time line of the projects involved?

4. how many project applications were made and how selected through what process?

5. did the Greek Ministry of Culture or anyone else representing Greece exert influence upon evaluation procedures by independent experts and upon the final round of decision making at EU level?

6. what information about the budgets of each of the successful projects in terms of their application was required and did any monitoring take place to prove the validity of claims made?

7. how clear was the financial report after completion of project and what outcomes were secured as a result?

 

5.2.3 public- private partnerships for funding of the arts.

 

Diversification of risk factors have produced everywhere mix models. This includes the organizational structure which can be made up of non profit and profit making types of units.

Critical in this type of partnership is that the tax payer still covers the risks undertaken supposingly by the private investor if, as is the case with Hochtief holding 40% of shares for a number of years and the rest the Greek government for supplying, constructing and operating the airport with incomes guaranteed by the Greek government.

1999 in Canada a new Municipal Act was passed to provide local governments with guidelines for entering partnerships with private investors. The definition of Public private partnerships (PPPs) is sought out of roles, risks and responsibilities to be shared:

“Public private partnerships (PPPs) are arrangements between government and private sector entities for the purpose of providing public infrastructure, community facilities and related services. Such partnerships are characterized by the sharing of investment, risk, responsibility and reward between the partners. The reasons for establishing such partnerships vary but generally involve the financing, design, construction, operation and maintenance of public infrastructure and services.

The underlying logic for establishing partnerships is that both the public and the private sector have unique characteristics that provide them with advantages in specific aspects of service or project delivery. The most successful partnership arrangements draw on the strengths of both the public and private sector to establish complementary relationships.

The roles and responsibilities of the partners may vary from project to project. For example, in some projects, the private sector partner will have significant involvement in all aspects of service delivery, in others, only a minor role.

While the roles and responsibilities of the private and public sector partners may differ on individual servicing initiatives, the overall role and responsibilities of government do not change. Public private partnership is one of a number of ways of delivering public infrastructure and related services. It is not a substitute for strong and effective governance and decision making by government. In all cases, government remains responsible and accountable for delivering services and projects in a manner that protects and furthers the public interest.” [2]

 

Types of Public Private Partnerships

 

Type of PPP	Features	Local Government Applications	Advantages	Disadvantages
1 Operations and Maintenance	The local government contracts with a private partner to operate and maintain a publicly owned facility.	A broad range of municipal services including water and wastewater treatment plants, solid waste removal, road maintenance, parks maintenance/ landscape maintenance, arenas and other recreation facilities, parking facilities, sewer and storm sewer systems.	• potential service quality and efficiency improvements • cost savings • flexibility in structuring contracts • ownership vests with local government	• collective agreements may not permit contracting out • costs to re-enter service if contractor defaults • reduced owner control and ability to respond to changing public demands
2 Design-Build	The local government contracts with a private partner to design and build a facility that conforms to the standards and performance requirements of the local government. Once the facility has been built, the local government takes ownership and is responsible for the operation of the facility.	Most public infrastructure and building projects, including roads, highways, water and wastewater treatment plants, sewer and water systems, arenas, swimming pools and other local government facilities.	• access to private sector experience • opportunities for innovation and cost savings • flexibility in procurement • opportunities for increased efficiency in construction • reduction in construction time • increased risk placed on private sector • single point accountability for the owner • fewer construction claims	• reduced owner control • increased cost to incorporate desirable design features or change contract in other ways once it has been ratified • more complex award procedure • lower capital costs may be offset by higher operating and maintenance costs if life-cycle approach not taken
3 Turnkey Operation	The local government provides the financing for the project but engages a private partner to design, construct and operate the facility for a specified period of time. Performance objectives are established by the public sector and the public partner maintains ownership of the facility.	This form of public private partnership is applicable where the public sector maintains a strong interest in ownership but seeks to benefit from private construction and operation of a facility. This would include most infrastructure facilities, including water and wastewater treatment plants, arenas, swimming pools, golf courses and local government buildings.	• places construction risk on the private partner • proposal call can control design and location requirements as well as operational objectives • transfer of operating obligations can enhance construction quality • potential public sector benefits from increased efficiency in private sector construction • potential public sector benefits from increased efficiency in private sector operation of the facility • construction can occur faster through fast-track construction techniques such as design-build	• reduced local government control over facility operations • more complex award procedure • increased cost to Incorporate changes in design and operations once contract is completed • depending on the type of infrastructure, financing risk may be incurred by the local government
4 Wrap Around Addition	A private partner finances and constructs an addition to an existing public facility. The private partner may then operate the addition to the facility for a specified period of time or until the partner recovers the investment plus a reasonable return on the investment.	Most infrastructure and other public facilities, including roads, water systems, sewer systems, water and wastewater treatment plants, and recreation facilities such as ice arenas and swimming pools.	• public sector does not have to provide capital funding for the upgrade • financing risk rests with private partner • public partner benefits from the private partner’s experience in construction • opportunity for fast-tracked construction using techniques such as design-build • flexibility for procurement • opportunities for increased efficiency in construction • time reduction in project implementation	• future facility upgrades not included in the contract with the private partner may be difficult to incorporate at a later date • expense involved in alteration of existing contracts with the private partner • perceived loss of control • more complex contract award procedure
5 Lease- Purchase	The local government contracts with the private partner to design, finance and build a facility to provide a public service. The private partner then leases the facility to the local government for a specified period after which ownership vests with the local government. This approach can be taken where local government requires a new facility or service but may not be in a position to provide financing.	Can be used for capital assets such as buildings, vehicle fleets, water and wastewater treatment plants, solid waste facilities and computer equipment.	• improved efficiency in construction • opportunity for innovation • lease payments may be less than debt service costs • assignment of operational risks to private sector developer • improve services available to residents at a reduced cost • potential to develop a “pay for performance” lease	• reductions in control over service or infrastructure
6 Temporary Privatization	The facility is then owned and operated by the private partner for a period specified in a contract or until the partner has recovered the investment plus a reasonable return. Ownership of an existing public facility is transferred to a private partner who improves and/or expands the facility.	This model can be used for most infrastructure and other public facilities, including roads, water systems, sewer systems, water and wastewater treatment plants, parking facilities, local government buildings, airports, and recreation facilities such as arenas and swimming pools.	• if a contract is well structured with the private partner, the municipality can retain some control over standards and performance without incurring the costs of ownership and operation • the transfer of an asset can result in a reduced cost of operations for the local government • private sector can potentially provide increased efficiency in construction and operation of the facility • access to private sector capital for construction and operations • operational risks rest with the private partner • perceived or actual loss of control	• initial contract must be written well enough to address all future eventualities • private sector may be able to determine the level of user fees, which they may set higher than when under local government control • difficulty replacing private partner in the event of a bankruptcy or performance default • potential for local government to re-emerge as the provider of a service or facility in the future • displacement of local government employees • labour issues in transfer of local government employees to the private partner
7 Lease- Develop- Operate or Buy- Develop- Operate	The private partner leases or buys a facility from the local government, expands or modernizes it, then operates the facility under a contract with the local government. The private partner is expected to invest in facility expansion or improvement and is given a specified period of time in which to recover the investment and realize a return.	Most infrastructure and other public facilities, including roads, water systems, sewer systems, water and wastewater treatment plants, parking facilities, local government buildings, airports, and recreation facilities such as arenas and swimming pools.	• if the private partner is purchasing a facility, a significant cash infusion can occur for the local government • public sector does not have to provide capital for upgrading • financing risk can rest with the private partner • opportunities exist for increased revenue generation for both partners • upgrades to facilities or infrastructure may result in service quality improvement for users • public partner benefits from the private partner’s experience in construction • opportunity for fast-tracked construction using techniques such as design-build • flexibility for procurement • opportunities for increased efficiency in construction • time reduction in project implementation	• perceived or actual loss of control of facility or infrastructure • difficulty valuing assets for sale or lease • issue of selling or leasing capital assets that have received grant funding • if a facility is sold to a private partner, failure risk exists—if failure occurs, the local government may need to Re-emerge as a provider of the service or facility • future upgrades to the facility may not be included in the contract and may be difficult to incorporate later
8 Build- Transfer- Operate	The local government contracts with a private partner to finance and build a facility. Once completed, the private partner transfers ownership of the facility to the local government. The local government then leases the facility back to the private partner under a long-term lease during which the private partner has an opportunity to recover its investment and a reasonable rate of return.	Most infrastructure and other public facilities, including roads, water systems, sewer systems, water and wastewater treatment plants, parking facilities, local government buildings, airports, and recreation facilities such as arenas and swimming pools.	• public sector maintains ownership of the asset • public sector ownership and contracting out of operations limits any provincial and federal tax requirements • public sector maintains authority over the levels of service(s) and fees charged • compared to a Build-Operate- Transfer model, avoids legal, regulatory and tort liability issues • under Occupiers’ Liability Act, tort liability can be avoided • government control of operational performance, service standards and maintenance • ability to terminate agreements if service levels or performance standards not met, although facility would continue to permit repayment of capital contributions and loans and introduction of new private partner • construction, design and architectural savings, and likely long-term operational savings • public sector obtains the benefit of private sector construction expertise • public sector obtains the potential benefits and cost savings of private sector operations Features	• possible difficulty in replacing private sector entity or terminating agreements in event of bankruptcy or performance default

Government

What applies in terms of culture when such PPP are entered?

-         cultural infrastructural requirements / closely akin to other infrastructural projects: theatres, cultural venues

-         schools and training centres especially in cases where the private sector does not seem to contribute to a just distribution e.g. dancing school in every district

-         financial accountability has to reside with one coordinating unit, legal status, financial management and competence to handle in the various phases of negotiations with the different partners involved. The type of ownership and claim of ownership are very different but it matters how things are presented in public and what sustains the process over time.

-         Such a partnership differs when the government outsources completely the task and asks only for accountability in terms of a) substantial guidelines and b) financial accountability.

 

Public procurement laws

Laws governing competitive bids –

a)      even if an expert / NGO helps a public authority obtain the European funded project through its assets (network, expertise, innovative ideas to match program with local needs, deployment of personnel to train and to inform local council members and others of the local administrative staff), there is no guarantee for partnership within the consortium. Eligibility of partnership poses a limitation as to who can receive EU funding directly as recognized partner.

b)      In practice competitive rules for obtaining at least three bids so that the local authority can select out of them the most efficient one in terms of costs and promise of delivery of excellence in advise and work, usually one application is serious and two are fake as this can easily be organize in the free market.

 

Greece

Culture

http://www.sdit.mnec.gr/en/sectors/sector/sector0001.html

Projects Under Implementation   Construction of an International Conference Center in the Faliro Pavilion (Tae Kwon Do stadium)

 

Project Information
Project Title	Construction of an International Conference Center in the Faliro Pavilion (Tae Kwon Do stadium)
Sector	Culture
Contracting Authority	General Secretariat for the Olympic Utilization
Supervisor	Ministry Of Culture Contact Details Ms Athanasia Boutsika Phone:             +30 210 6497052        Fax: +30 210 6496610 Email: ggoa@ggoa.culture.gr
Project Details	This PPP project will involve the reconstruction of the interior of the Faliro Pavilion to an International Conference Center. The private entity that will be selected will also provide all the necessary maintenance and facility management services for a period of 25 years. The operation of the International Conference Center is not part of this project. The selection of the operator will be made parallel to the procedure for the selection of the SPV for this project. In cooperation with the operator, the Ministry of Culture, the sponsor of this project, will determine in detail the availability specifications in the tender documents of this project. The new International Conference Center will have a total surface of 28,000 m 2 and will serve as the venue for hosting international meetings, conferences, business seminars and other similar events. With its construction, focus is given on attracting tourists of high level income, networking greek firms with foreign organizations, promoting the scientific output of greek research, and finally placing Greece as a focal point on the map of conference tourism, especially after the successful organization of the 2004 Olympic Games. It is estimated that the new International Conference Center will host 100 events during its first operational year, while after the fifth year the number of events will be as high as 200. The operation of the International Conference Center will be a source of important revenue for the Greek State, as it is estimated that revenues from this new wave of tourists will amount to 60 million euros per year. The availability payments will depend on the quality of the maintenance services, according to predetermined quality criteria.
Location(s):	Attica
Date of approval by the IM PPP Committee	05 Jun 2006
Status of the project	Bidding for the selection of the SPV in progress
Transaction Status	An international tender for the selection of the Private Entity is in progress. Five candidates (5) submitted expressions of interest
Indicative Budget	54 million euros (+20% insurance costs and heavy maintenance cost)
Project Duration	25 years
Construction Period	2 years
Operation Period	23 years
Technical Advisor of Contracting Authority	BUNG GMBH
Legal Advisor of Contracting Authority	JURIS LAW FIRM - SOFIA DIMITRAKOPOULOU & ASSOCIATES LAW FIRM
Financial Advisor of Contracting Authority	ERNST & YOUNG S.A. & ERNST&YOUNG LLP

 

10.07.2007 Tender information notice for the financing, design, reconstruction, restoration and facility management of an International Conference Centre, and of its landscape, on the existing infrastructure of the Faliro Pavilion Contracting Authority : General Secreteriat for the Olympic Utilization Closing Date : 25.10.2007 Tender information notice ''Financing, design, reconstruction, restoration and facility management of an International Conference Centre, and of its landscape, on the existing infrastructure of the Faliro Pavilion'' PART 1: CONTRACTING AUTHORITY 1. Name, address, fax number and email address of the Contracting Authority: General Secreteriat for the Olympic Utilization, 7 Kifissias Av. Athens, PC 11523, tel.               2106497000       , fax 210 6496610, email: ggoa@culture.gr website: www.ggoa.gr PART 2: DESCRIPTION 2. Name of the contract, as given by the Contracting Authority. ''Financing, design, reconstruction, restoration and facility management of an International Conference Centre and of its landscape on the existing infrastructure of the Faliro Pavilion'' 3. Brief description of the contract: This PPP project relates to the financing, design, reconstruction, restoration, facility management and landscape formation/ plantation, withinin the limits of the provided land-plot for the project ''Financing, design, reconstruction, restoration and facility management of an International Conference Centre and of its landscape on the existing infrastructure of the Faliro Pavilion'' (<< Project>>). The infrastructure is governed by the provisions of Law 3342/2005 for the Olympic Utilisation. This Partnership is part of the strategic plan of the General Secretariat of the Olympic Utilization of the Ministry of Culture for the exploitation of the Olympic premises. Pursuant to the decision of the Greek Inter-ministerial PPP Committee dated 05.06.2006, the Project was approved for inclusion under the provisions of Law 3389/2005. The private partner that will be selected shall undertake: a) the elaboration of all necessary design studies and documents needed for the issuance of licences and permits according to the law in force, for the  performance and/or maintenance of the Project, taking into consideration the existing building infrastructure of the Faliro Pavilion that will be handed over as it is, b)  the financing of the Project through equity and debt c)  all the works required for the restoration, reconstruction and reformation of the Project as they will be specified during the second phase of the tender d) the facility management that will include the inspection, the preventive, regular and heavy maintenance (life cycle cost) and the technical daily operation of the infrastructure, the systems of the buildings and of the landscape, as per the Output Specifications to be included in the Tender Documents of the second phase of the Restricted Procedure, in order for the facility to operate  as a Conference Centre and to host events, e) the insurance of all building and other infrastructure and equipment, both during the design and reconstruction phases and during the operational phase f) the payment of any other expenses that may occur, the amount of which will be defined in the second phase of this Tender. 4. Admission or prohibition of variants. Variants are prohibited 5. Total amount or extent. The overall budget of the availability payments for the Project that will be paid to the Private Entity has been indicatively estimated to amount to 54.000.000,00 euros (+20% cost of insurance and heavy maintenance + VAT). 6. Duration of the Contract Twenty six (26) years and six (6) months. PART III. LEGAL, ECONOMIC, FINANCIAL AND TECHNICAL INFORMATION 7. Deposit and guarantees required The guarantee for the participation in the second phase of the tender, as well as other guarantees shall be defined in the tender documents of the second phase. 8. Main terms concerning financing and payment and/or references to the texts in which these are contained: The financing of the Project shall be made via equity and debt raised by the Private Entity. The Project shall be implemented according to Law 3389/2005 and the availability payments shall be linked to the output specification, which shall be described in the tender documents of the Second Phase. 9. Legal form to be taken by the grouping of economic operators to whom the contract is to be awarded Special Purpose Societe Anonyme, according to article 1, paragraph 4 of Law 3389/2005. 10. Additional Information The tender shall take place and the contract shall be awarded and implemented according to Law 3389/2005, Directive 2004/18/EU, Law 2522/1997, Law 3310/2005, Law 2741/1999 and the terms of the tender documents of the first and second Phase of the tender. 11. Entities entitled to participate Any physical or legal entities may participate in the tender, independently or in consortium, as long as they or their members come from a Member State of the European Union or the European Economic Area (EEC) or from states that have signed bilateral agreements or association agreements with the European Union or have ratified the Government Procurement Agreement (GPA) under the auspices of the World Trade Organization (WTO), as long as they satisfy the conditions and participation requirements as set in the detailed Tender Documents of Restricted Procedure - First Phase - Submission of Interest Expression. Any Entities may participate in the tender provided that they fulfil the minimum levels of financial adequacy, credit worthiness and experience in securing debt financing for projects repaid by end users, PPP projects and concession projects, as follows: i) The average net results before taxes of each candidate for the last three financial years, as evidenced in the published financial statements, must be positive. In case of a consortium, the above criterion shall be calculated as the average of the net results before taxes of the members of the consortium, weighted according to their participation percentage in the consortium, and should obligatorily occur at least for one member of the consortium, participating in it with a share of more than 33%. ii) The ratio of the sum of the debt to the sum of the equity of each candidate for the last three financial years must be lower than 2, as evidenced in the published financial statements of the three last financial years. In case of a consortium, the above criterion shall be calculated as the weighted average of the ratio of debt to equity of the consortium members, according to their participation percentage in the consortium, and should obligatorily occur at least for one member of the consortium, participating in it with a share of more than 33%. iii) The average equity capital for each candidate for the last three financial years should exceed 20.000.000 euros, as will be evidenced by its published financial statements of the last three financial years. In case of a consortium, the above criterion shall be calculated as the weighted average of the consortium members' equity capital for the last three financial years, according to their participation percentage in the consortium, and should obligatorily occur at least for one member of the consortium, participating in it with a share of more than 33%. iv) Each Candidate should demonstrate its credit and debt raising ability with respect to the Project. In case of a consortium, the percentage of participation of each member in the consortium shall be determined; said percentage shall be the percentage of each member of the consortium in the share capital of the Special Purpose Company, should said consortium be selected to implement the project. Each candidate shall be excluded from the tender procedure, provided that any of the following occurs with respect to the specific person (in case of participation of a physical person or of a legal entity) or any of its members (in case of participation of a consortium) or any of the collaborating operators, joint ventures or consortiums of the paragraphs 10.4.a, 10.4.b and 10.4.c: Has been convicted by a final judgment for one or more of the following: - Participation in a criminal organisation, as defined in Article 2(1) of Council Joint Action 98/733/JHA. - Bribery, as defined in Article 3 of the Council Act of 26 May 1997(21) and Article 3(1) of Council Joint Action 98/742/JHA. - Fraud within the meaning of Article 1 of the Convention relating to the protection of the financial interests of the European Communities. - Money laundering, as defined in Article 1 of Council Directive 91/308/EEC, on prevention of the use of the financial system for the purpose of money laundering - Embezzlement (375 of the Greek Penal Code), fraud (386, 388 PC), blackmail (385 PC), forgery (216, 218 PC), false oath (224 PC), bribery (235 - 237 PC) and fraudulent bankruptcy (398 PC), provided that these convictions are related to its professional activities. Has been convicted by final judgment under the laws of the state where he/she is established, for an offence involving his/her professional conduct is subject to bankruptcy proceedings, liquidation, suspension of trading, administration or receivership or any other status arising from similar proceedings envisaged in the national legal and regulatory provisions applicable in each case, or if proceedings have been initiated with a view to placing the person in bankruptcy, liquidation, administration or receivership or any other status arising from similar proceedings envisaged in the national legal and regulatory provisions applicable in each case. Has been proven to have committed a serious professional offence. Has failed to meet its obligations in respect of the payment of national insurance contribution in accordance with the legal provisions of the country where it is established or under Greek law. Has failed to meet its obligations in respect of the payment of taxes and duties in accordance with the legal provisions of the country where it is established or under Greek law. Has made a false statement in the provision of the above information or has failed to provide this information. The persons entitled to participate in the tender, according to the above, should for: a)  The elaboration of all design studies of the Project b)  The reconstruction and restoration of the Project and the landscape formation / plantation c)  The facility management and the maintenance of the infrastructure of the Project must have the below mentioned design, construction and facility management qualifications and experience or demonstrate in written their ability to cooperate with any capable legal entities or physical persons -independently, in consortium or joint venture-, which meet the below mentioned design, construction and facility management qualifications and experience: 1. For the elaboration of the design studies of the project: 1(a) Be listed in the Greek Registers of Designers or Design Offices/Companies, referred to in Annex ΙΧ C of Directive 2004/18/ΕC and, specifically, hold the following planning/design qualifications: a) E class in categories 6 and 7 ''Architectural studies for building projects'' and ''Special Architectural studies'' b)  E class in category 8 ''Static studies'' c) E class in category 9 ''Electrical engineering studies'' d)  C or above in category 25 ''Landscape restoration - plantation'' (1b) Or come from member states of the EU or EEA or states which have ratified the WTO Agreement on Government Procurement, which keep equivalent registers to those specified under the above paragraph 1(a) and are registered in classes and categories corresponding to those of paragraph 1(a), (1c) Or come from member states of the EU or EEA or states which have ratified the WTO Agreement on Government Procurement which do not keep the registers specified above and are registered on professional/commercial registers of the state where they are established and have general experience corresponding to that deriving from registration on the Registers of Designers - Design Offices/Companies, i.e. a personnel with experience in corresponding classes of design, as follows: a) for categories 6 and 7 ''Architectural studies for building projects" and ''Special Architectural studies'' at least two staff members with experience, one of them at least 8 years and the other at least 12 years b) for category 8 "Static studies" at least two staff members with experience, one of them at least 8 years and the other at least 12 years c) for category 9 "Electrical engineering studies" at least two staff members with experience, one of them at least 8 years and the other at least 12 years and d) for category 25 ''Landscape restoration - plantation'' at least one staff members with experience of at least  2 years. 2. For the construction of the Project (2.a)  Be listed in the Register of Contracting Companies, kept at the General Secretariat for Public Works at the Ministry of the Environment, Physical Planning and Public Works and mentioned in Annex ΙΧ Α of Directive 2004/18/ΕC. (2b) Or come from member states of the European Union or European Economic Area (EEA), or from states which have signed the Agreement on Government Procurement of the WTO, in which official lists of recognized contracting entities are kept, in accordance with Annex ΙΧ Α of Directive 2004/18/ΕC, provided that they are registered on these official lists. (2c) Or come from the states listed above under (2b) in which official lists of recognized contracting entities are not kept but which are listed in professional/commercial registers of the state where they are established, provided that they can demonstrate that they meet the conditions of paragraphs 10.4.b.5 and 10.4.b.6 of the Tender. In case of a construction consortium or joint venture, each member must participate in it with a share of at least 25%. (3) For the facility management and maintenance of the Project: Have a corporate scope including the maintenance, technical operation and facility management of projects and infrastructure themselves or in case of a joint ventures or consortium, their members. Each person or legal entity is entitled to participate in only one competing group, whether acting solely or as member of a consortium or as member of a joint venture or as an associate member. Otherwise all candidates in whose composition it participates as a member or with whom it collaborates shall be disqualified. The Candidates and the above mentioned collaborating companies must satisfy the minimum financial and technical ability levels, as set in article 10 of the Tender Documents of Restricted Procedure- First Phase- Submission of Interest Expression. PART 4: PROCEDURE 12. Award Procedure. Restricted procedure. 13. Limitations as to the number of entities to be invited to submit tenders. A) Anticipated number of candidates Five (5) B) Objective criteria to be used to chose that number of candidates. According to article 16 of the Tender Documents of Restricted Procedure - First Phase - Submission of Interest Expression. 14. Contract Award criterion The most economically advantageous offer (according to the criteria that will be described in the invitation to submit tenders) 15. Deadline for the receipt of applications for files or for the access to files 27 August 2007 16. Name, address, telephone and fax numbers, e-mail of the agency from which the Tender Document of Restricted Procedure- First Phase - Submission of Interest Expression and further can be requested. General Secreteriat for the Olympic Utilization, Ministry of Culture, 7 Kifissias Avenue, 2nd floor, Athens, PC 11523 tel.               210 6497000        , fax 210 6496610, e-mail: ggoa@ggoa.culture.gr, website: www.ggoa.gr Information: G. Vamvourelis, tel:               210 6497070-1        fax: 210 6496610, e-mail :    gvamvourelis@ggoa.culture.gr 17. Cost for the provision of the documents and payment terms The interested parties can obtain the Tender Documents in Greek for the amount of 150 Euros. The translation of the Tender in English language is also available for the amount of 300 Euros. 18. Deadline for the receipt of the interest expressions 6 September 2007 19. Language that shall be used in the application for participation Greek 20. Day of dispatch of the notice to the Commission 2 July 2007

New deadline for the submission of Expressions of Interest for the International Tender "Financing, design, reconstruction, restoration and facility management of an International Conference Centre, and of its landscape, on the existing infrastructure of the Faliro Pavilion via PPP" New deadline for the submission of Expressions of Interest for the International Tender "Financing, design, reconstruction, restoration and facility management of an International Conference Centre, and of its landscape, on the existing infrastructure of the Faliro Pavilion via PPP" Seven (7) more days were granted for the submission of Expressions of Interest for the International Tender "Financing, design, reconstruction, restoration and facility management of an International Conference Centre, and of its landscape, on the existing infrastructure of the Faliro Pavilion via PPP"

 

General policy position on public – private partnership:

Statement by the Minister:

“Through PPPs the Ministry of Economy and Finance aims to accelerate the completion of smaller and larger scale infrastructure projects with significant impact to the Greek society.

Thirty four projects worth four billion Euros have already been approved since March 2006, when the PPP Interministerial Committee was established. These projects fall into different sectors of the economy ranging from education and health to port infrastructure, waste and sewage management, accommodation of public authorities and tourism.

The main aim of the PPP Unit is to create a new market of projects and services, which will significantly contribute to the development of the Greek economy. To present, the procedures for the appointment of specialized financial, technical and legal advisors have been completed for most of the aforementioned projects. More than 100 Greek and foreign companies have participated in the respective tenders demonstrating the ardent interest of the Greek and international market in Greek PPP opportunities.

The participation of many well-established foreign companies in the tenders of the first pilot PPP projects demonstrates the confidence in the potential of the Greek PPP market – a broad market based on a new and efficient legal framework as well as on swift and transparent procedures.” [3]

References:

• Law 3389/2005

• Contact Details

• Link to the Official PPP web site

Challenges of bad practices

Punishment for being innovative when it comes to proposing good ideas – no reward guaranteed; also the risk of being expropriated by project leader once the project has been approved. Legal challenges are only possible in the country of the project leader but not at the level of the European Commission, so that many mistakes are left undone and are not challenged.

Lack of monitoring and evaluation – financial control

Matter of project leader assuming a single role in the project and thereby violating the very concept of European project as being horizontal integration attempts on the basis of equality between all partners.

Not the outcomes secured as originally intended and therefore critical milestones not attained in time to secure outcomes.

Concrete outcomes is one thing, an open ended learning process with achievement being qualitative differences made in the progress quite another kind of performance measure.

Experiences made, knowledge attained and information validated: clarity of aims, means and results achieved.

Quality of partnership and what can be achieved by European projects within their limited time period in the given political context of uncertainties about finances at local level and constant political disputes about ownership, participation, access to information and obtaining an ear of the mayor / Municipal Council, while generally suspicion about ‘corruption’ leads to all kinds of false accusations and endless legal, equally time consuming hustles with often bitter conflicts making life and work not any easier since people have to live at the same time together in one and the same community.

---

[1] Source: http://www.fhwa.dot.gov/ppp/defined.htm#20

[2] PUBLIC PRIVATE PARTNERSHIP: A Guide for Local Government (1999). Ministry of Municipal Affairs. British Columbia, Canada http://www.cserv.gov.bc.ca/lgd/policy_research/library/public_private_partnerships.pdf

[3] http://www.mnec.gr/en/metarithmisi/sympraxeis_id_dhmosiou/

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