Policy paper

Annex 1: Arts Council England Review - Purpose and role of Arts Council England

Published 16 December 2025

Applies to England

Purpose

Arts Council England (ACE) is England’s national development agency for creativity and culture, and a funding body which distributes public money from the Government and the National Lottery. Arts Council of Great Britain was established in 1946 and ACE was established in 1994 by Royal Charter, with its objectives being ‘for the public benefit, to:

• develop and improve the knowledge, understanding and practice of the arts
• increase accessibility of the arts to the public in England
• advance the education of the public and to further any other charitable purpose which relates to the establishment, maintenance and operation of museums and libraries (which are either public or from which the public may benefit) and to the protection of cultural property
• advise and co-operate, where it is appropriate to do so, with the Departments of Our Government, Our Scottish Administration, the Northern Ireland Executive and the Welsh Ministers, local authorities, the Arts Councils and equivalent organisations in the museums and libraries sector for Scotland, Wales, and Northern Ireland (or their successors) and other bodies on any matter related to the objects’

The Arts Council currently defines its role as “the national development agency for creativity and culture.

The core purpose of [its] development role is to undertake activities that will support the cultural sector to thrive, reach its growth potential and increase accessibility of the arts to the public. [It] doe[s] this by:

• Investing strategically to ensure more communities in this country have access to publicly funded culture
• Growing skills, knowledge and networks developing partnerships e.g. with local government and our 54 Priority Places
• Advocating the value of creativity and culture.”

Today, ACE’s main objective, as outlined in its current strategy, is to support the country to become one in which ‘the creativity of each of us is valued and given the chance to flourish, and where every one of us has access to a remarkable range of high-quality cultural experiences.’ The organisation aims to develop both culture (defined by ACE as areas of activity associated with the artforms and organisations in which it invests) and creativity (the process of making or conceiving of something new, and in turn producing or participating in ‘culture’) as distinct but deeply interconnected features of society.

ACE’s wide remit of artforms and disciplines includes Music, Theatre, Dance, Literature, Combined Arts (e.g. festivals), Visual Arts, Museums (including Collections and Cultural Property), and Libraries. ACE recognises that the traditional boundaries between these artforms and disciplines are disappearing as new technologies and other societal changes alter the way in which artists and others work. This means that ACE is flexible about the range and type of cultural activities it supports. This includes introducing a new category of ‘Digital Arts’ to sit alongside these artforms and disciplines.

As a funding body, ACE allocates funding to a group of National Portfolio Organisations (NPOs), which in turn help to deliver its strategy outcomes. The 2023-2026 cohort currently consists of 985 NPOs, 33 of which are Investment Principles Support Organisations (IPSOs) which help to deliver against ACE’s Investment Principles.^{[footnote 1]}

The organisation invests on average £50 million per year into development: Developing your Creative Practice, Creative People and Places, and the Museum Development programme These initiatives support a variety of areas, such as: capital investment, cultural education, the Digital Culture Network, museum development, Arts Council collection management, UK City of Culture, among other activities listed within the Development Plan. ACE’s National Lottery Project Grants also provide funding for individual practitioners, community and cultural organisations, balanced to ensure funding goes to underrepresented groups and areas.

In addition to the National Portfolio Investment Programme, ACE helps to deliver one-off funding initiatives which often have greater involvement from the Government - the Cultural Investment Fund and Culture Recovery Fund are significant examples. It also provides ongoing strategic funding schemes aimed at specific challenges within the sector, such as the Museums and Schools Programme, which is delivered on behalf of the Department for Culture Media and Sport.

Arts Council England also has the following statutory duties and functions:

• Making decisions in exercise of the Secretary of State’s functions under section 230 of the Inheritance Tax Act 1984, and give directions under section 9 of the National Heritage Act 1980, in relation to the acceptance and disposal of property under the Acceptance in Lieu Scheme, whereby Inheritance Tax can be paid by transferring important cultural, scientific or historic objects and archives to the nation.
• Operating and maintaining the Acceptance in Lieu Panel.
• Administration of the Cultural Gifts Scheme, which allows UK taxpayers to donate important works of art to the public in exchange for a tax reduction - under Schedule 14 of the Finance Act 2012.
• Administration of the Government Indemnity Scheme, an alternative to commercial insurance which helps art and cultural objects to be shown publicly in the UK - in accordance with sections 16 and 16A of the the National Heritage Act 1980
• Processing applications for export licences for objects of cultural interest - under the Export of Objects of Cultural Interest (Control) Order 2003.
• For Immunity from Seizure, approving and monitoring the performance of institutions that have been approved under section 136 of the Tribunals Courts and Enforcement Act 2007, and informing the department if an institution is failing to maintain required standards of due diligence.
• Providing the Secretariat and administrative support to the Reviewing Committee on the Export of Works of Art.
• Acting as the competent authority for EU Regulation (EU) 2019/880 on the introduction and the import of cultural goods in respect of Northern Ireland, responsible for processing applications for import licences, approving requests for exemptions by private and semi-private institutions and other functions as set out in the Regulation (EU) 2019/880 and associated Commission Implementing Regulation (EU) 2021/1079.

Arts Council England is an executive non-departmental public body, sponsored by the Department for Culture, Media and Sport. The relationship between the Department and ACE is set out in a Framework Document. DCMS also sets the policy and financial framework within which the distributing bodies for National Lottery grants must operate, and issues Lottery Policy Directions to ACE and other distributors.

Legislative bases

Arts Council England is governed by the following legislation:

Royal Charter 1946 (and amended Supplemental Charters in 2002, 2008, 2011, and 2013)

The Royal Charter provides the legal basis for ACE’s existence, powers and duties.

Charities Act 2011

ACE is a registered charity, regulated by the Charity Commission, and must comply with the Charities Act 2011.

National Lottery Act 1993

ACE is a distribution body of funds raised by the National Lottery under the provisions of the National Lottery Act 1993.

Summary of financial information

For the year ending 31 March 2025 (From ACE’s Annual Reports and Accounts 2024-25):

• Income - £843,062,000
• Grant-in-Aid - £578,077,000
• Lottery - £250,259,000
• Investment returns on the Distribution - £12,035,000
• Other income - £2,691,000
• Expenditure - £731,085,000

Structure and size

Arts Council England is governed by a government appointed National Council which is supported by five Area Councils. The organisation is led by an Executive Board and senior leadership team.

National Council - Non-Executive Board

The National Council holds overall responsibility for the governance of ACE. Members are appointed for their special interest in, or experience of, the arts as practising artists or art administrators; as senior academics; or as public or private sector executives. They are appointed by the Secretary of State for Culture, Media and Sport^{[footnote 2]}, usually for four years and may be reappointed for a further term of four years. Members are also charitable trustees.

The National Council consists of:

• National Chair, Sir Nicholas Serota
• 5 chairs of area councils
• 9 other members

Area councils

Five Area Councils contribute to the governance of ACE, covering the North, South East, South West, London, and the Midlands. Area Council members are made up of people from different backgrounds across and beyond the cultural and creative sector. They include artists and creative practitioners, administrators and local authority representatives, all of whom are knowledgeable about the unique features of their respective areas.

The role of the Area Councils is to:

• make decisions on organisations joining ACE’s National Portfolio and make recommendations to National Council
• help to implement Lets Create, ACE’s 10 year strategy
• monitor Arts Council England’s performance towards its goals
• advocate for arts and culture in their areas

Senior Leadership Team & Executive Board

The senior leadership team comprises senior directors as well as Executive Board members.

The executive board is made up of:

• Chief Executive, Darren Henley
• 2 Deputy Chief Executives
• Chief Financial Officer
• Chief Operating Officer
• 2 Executive Directors

Staff

As at 2024-25 ARAs:

• Governance bodies: 5 Area Councils covering North, Midlands, South West, London and South East. 15 National Council members and 70 Area Council Members.
• Staff: 697 headcount / 649 FTE

Timeline of key changes in structure and remit

Year	Change
1940	Committee for Encouragement of Music and the Arts (CEMA) set up by Royal Charter
1946	CEMA was renamed the Arts Council of Great Britain by a new Royal Charter
1994	The Arts Council of Great Britain was replaced with National Arts Councils - the Arts Council of England, the Scottish Arts Council, and the Arts Council of Wales. The National Lottery was established, with the Arts Council of England as a distribution body.
1997	DCMS was established, renamed from the Department of National Heritage
2002	The Arts Council of England and the 10 regional arts boards merged…
2003	…and this new organisation was named Arts Council England
2011	ACE assumed new responsibility for the support and development of museums and libraries, following the abolition of the Museums, Libraries and Archives Council. Its 10 year strategy was updated to include the new sectors in 2013.

Current 10 Year Strategy: Let’s Create

Development

Beginning in Autumn 2017, ACE began developing its latest 10 Year Strategy. Throughout 2017 to early 2020, the organisation undertook research and multiple stages of drafting and consultation with the public, sector and stakeholders before publishing Let’s Create in January 2020. Research began with a conversation on the future of arts and culture involving more than 6,000 people from around the country, including members of the public, children and young people, artists, curators and librarians, leaders of cultural organisations, and those working in local and national government and in education. ACE reviewed more than 100 reports into the work of artists and arts organisations, libraries and museums, and commissioned an horizon scan. The development of Let’s Create was designed to be a pro-actively inclusive and iterative process, where findings and ideas were tested with the public, sector and stakeholders and an external reference group of ‘critical friends’ at key milestones.

Priorities

The central vision of Let’s Create is for, by 2030, ‘England to be a country in which the creativity of each of us is valued and given the chance to flourish, and where every one of us has access to a remarkable range of high-quality cultural experiences.’

This vision has three main outcomes:

• Creative people: everyone can develop and express creativity throughout their life
• Cultural community: villages, towns and cities thrive through a collaborative approach to culture
• A creative and cultural country: England’s cultural sector is innovative, collaborative and international

And four key Investment Principles:

• Ambition and quality: cultural organisations are ambitious and committed to improving the quality of their work
• Dynamism: cultural organisations are dynamic and able to respond to the challenges of the next decade
• Environmental responsibility: cultural organisations lead the way in their approach to environmental responsibility
• Inclusivity and relevance: England’s diversity is fully reflected in the organisations and individuals that [ACE] support and in the culture they produce

Delivery

The delivery of this strategy is based on a series of 3 three-year delivery plans, which set out how Let’s Create will be implemented in practice in these periods. The first Delivery Plan spanned 2021-24, and ACE has published a report on the progress it made during those three years. ACE also provides updates for each year in its Annual Reports and Accounts.

The second Let’s Create Delivery Plan covers the period 2024-27, and has been updated with specific Development Actions for 2025/26, these are below. The Delivery Plan is updated annually, at which point ACE will set Actions for the forthcoming year. ACE expects to publish its next refresh in 2026.

Development Actions 2025-26:

• Supporting our customers: placing user focus across all our activities
• Using data: we will collect and publish data to generate insights, support decision making, and demonstrate impact
• Embracing digital: our digital systems will be fit for purpose, effective and efficient
• Supporting our people: we will invest in our people to enable this change

More generally, ACE outlines a wide range of actions and areas of focus through which the full 10 year strategy will be implemented. This involves (not exhaustively) action such as:

• Raising awareness of the creative and cultural activities on offer by speaking directly to the public, in partnership with ‘cultural organisations, media companies, healthcare providers, charities and the voluntary sector, local and national government, and other National Lottery distributors’
• Continued partnership with the Department for Education and focussing on children
• Expanding the range of culture that ACE champions, particularly including in the amateur, voluntary and commercial sectors
• Improving the way ACE makes a case for the social and economic value of investing public money in culture
• Promoting research and development and supporting the adoption of new technologies
• Pushing to ensure that the cultural workforce is representative of contemporary England in its diversity
• Supporting new approaches to promoting environmental responsibility
• Investing in libraries, museums and arts venues to ensure that they are fit-for-purpose and able to meet the needs of their communities, and making the case for investing in new cultural buildings, in order to promote economic growth in their areas
• Expanding public access to museums’ collections
• Strengthening existing partnerships with local authorities and higher education institutes, and developing new ones - for example with the commercial, public and not-for-profit sectors; and from patrons, private donors and trusts and foundations

1. Though originally until 2026, the Portfolio will now last until 2028. ↩

2. Except the London Chair, who is appointed by the Mayor of London ↩