An orchestra is an extraordinary thing. Here is the Philharmonia drinking acidic tea and eating canteen salads in the crypt beneath the Henry Wood Hall, in south London. Members are about to rehearse Tchaik Five, as Tchaikovsky's Fifth Symphony is known to the pros. In jeans and pullovers, loafers and leggings, sweats, tees and polos, they look like a random sample of laid-back Brits. They wander upstairs into the fine Greek Revival interior, now cluttered with foam-lined boxes and eccentrically shaped cases, the clumsy paraphernalia that advertises the great, lumpen effort needed to make big music. They take their seats amid the pilasters, pick up their bits of wood, gut and brass, conductor Leonard Slatkin raises his baton and, whoosh, it's the Russian homeland, soldiers, guns, history, the whole, hot, sweet hit of Tchaik Five.

An orchestra is an extraordinary thing. Eighty or more people with mortgages and bad clothes, singled out from the herd only by an unusually rigorous education, get together and become, through sheer precision and technique, an organism possessed of breathtaking unity and limitless expressiveness. Magic, transcendent, amazing. The bad news is that orchestras in London are funded by the Arts Council of Great Britain.

Capricious, unreformed, irrational and pointless, the Arts Council is the amiable fag-end of Maynard Keynes's well-meaning project of 1945 to bring the masses into art and keep the government out. Five decades of policy gyrations later, it has succeeded in neither. The latest in the long line of Arts Council plans is a bizarre procedure for reducing from four to two the number of London orchestras it funds. This involves the orchestras submitting their justifications to a committee, as yet unnamed, to be chaired by Sir Leonard 'Lenny' Hoffman, a Lord Justice of Appeal. Only three orchestras have to submit because the London Symphony Orchestra, massively successful in its residency at the Barbican, is accepted as a de facto winner.

In something of a legalistic cop-out Lord Justice Hoffman tells me he 'neither approves nor disapproves' of the procedure; he will simply produce a recommendation for the Arts Council's December meeting. (Could you produce a report on which of these babies we should strangle, Lenny? Certainly, I neither approve, nor disapprove . . .)

The pseudo-legal, pseudo-objective air of the exercise is a fairly transparent attempt to paper over the vicious politics involved. The problem is that the four orchestras are all self-governing co-operatives, each of which sprang into being in the conviction that it could be better than any other. Though officially friendly, the orchestras can be bitchy off the record. But this is evidence of their unique character. 'We all have different styles,' says Roger Benedict, principal viola with the Philharmonia. 'The Philharmonia has a mellow, chamber-like string sound. The LSO is more, well, brash.'

This does not satisfy the planners. Ken Baird, music director of the Arts Council, insists that London has never had a truly world-class orchestra precisely because funding, ticket sales and talent are diluted among these four rivals. In addition the overall box office is falling because, he insists, there are not enough big, exciting, properly promoted events.

'We know from things like Classic FM that there is a big audience for classical music,' he says, 'but it is not turned into ticket sales.'

Baird claims that the success of the LSO at the Barbican shows the way ahead. The Barbican Hall seats 2,000 and is usually more than 90 per cent full. The Arts Council tried to repeat the formula by installing the London Philharmonic as resident orchestra at the Royal Festival Hall and giving the LSO and the LPO the biggest subsidies: pounds 1.13m each this year against pounds 711,000 for the Philharmonia and pounds 400,000 for the Royal Philharmonic.

But the LPO residency - awarded to the libellously expressed fury of the Philharmonia - has not worked. Management changes and the uncertain showing of its musical director and principal conductor, Franz Welser-Most, have combined to give the orchestra a messy image. The Philharmonia, meanwhile, has taken up a Paris residency and gleefully recruited some top-flight players from the LPO.

In a furious letter to the Arts Council chairman, Lord Palumbo, Jasper Parrott, one of London's most powerful music agents, points out that the Hoffman procedure amounts to an admission of failure of the LPO residency and adds: 'Whichever orchestra is selected by Lord Justice Hoffman will find itself within two years of its selection in a deep crisis both internally and externally with the Arts Council, with the South Bank and its music director. Furthermore, the quality of work achievable will be seen to be no better than that offered by the best of its losing competitors.'

This is an authoritative warning based on the conviction that if it ain't broke, don't fix it. And the conviction that it ain't broke is widely shared. For in return for what is in subsidy terms a pittance, London has four orchestras that act as the pinnacle of perhaps the world's most effective music education system.

This cannot be denied. The European Youth Orchestra has had to impose a quota on the number of British players - if pure quality were the criterion it would be nothing but Brits. Equally a Paris attempt to create a single, world-class orchestra has foundered. The 400 or so playing jobs in the London orchestras are the prized peak of the profession. At this peak they earn between pounds 30,000 and pounds 60,000 and they run their self-employed co-operative lives with a rare, rather unBritish passion and efficiency. Compare the London subsidies with the sums pumped into the world class competitors; on a roughly comparable basis the Berlin and Vienna Philharmonics receive pounds 13m each.

Nevertheless, the Arts Council insists that Hoffman and its implementation will go ahead. A suggestion made at the Association of British OrchestrETHER write erroras that nobody should co-operate predictably failed - the LSO, being already guaranteed a subsidy, would not close ranks and there is no love lost between the LPO and the Philharmonia. Tentative merger talks between the two have already failed, with bitter snarling on both sides.

This means that Hoffman is a race between the LPO and the Philharmonia. The RPO is a wild outsider because it has long been the most poppy of the four. Some say the loser will die a slow death, unable to compete for the best players and big-name conductors. Others say it will simply become a touring and recording orchestra, relieved of the burden of staging loss-making London concerts.

Both have tricks up their sleeves. The LPO has just appointed the high-cred Sir Harrison Birtwistle as its composer in residence. The Philharmonia is to lose its music director, Giuseppe Sinopoli, but insists it has a major star to replace him. This star, because of the Hoffman process, will not be identified in the submission. But, says David Welton, the Philharmonia's managing director, he will be verbally named to Hoffman. Cute.

Both orchestras have rich, powerful friends who will pull strings furiously between now and December. 'It'll be some backroom deal, some bribe,' says John Wallace, 17 years with the Philharmonia and now First Trumpet. The real bitterness emerges in speculation about the Arts Council's motives. The whole charade is a money-saving exercise, designed to shift funds to the favoured areas of contemporary dance and education. 'They've more or less admitted it,' says Welton. In the eyes of the musicians this reduces Hoffman to a shabby cover for just another Arts Council money crisis.

Back at the Henry Wood Hall, Slatkin and the Philharmonia are in overdrive, playing for their life. An orchestra is an extraordinary and wonderful thing. We have four and they cost next to nothing. Maybe changes have to be made, but the Arts Council has not shown it has the wisdom to make them.

'You are hurtling towards an outcome which will produce little or no benefit,' Jasper Parrott warned, 'and yet will do incalculable harm.'

So what about it, Lord Justice Hoffman? How about an honourable resignation from this job of which you 'neither approve nor disapprove'?

'Look at us,' says the Philharmonia's piccolo-playing chairman, Ken Bragg. 'Look what we do. If we don't deserve a few pennies for doing this, who does?'

(Photograph omitted)