A current deficit of pounds 1.6m is expected to increase to pounds 2m by April. Although the winter figures for Stratford are up by eight per cent on last year, to an average of 64 per cent, they are pounds 748,000 below a target set by the company two years ago.
More alarming is that some performances are playing to very low houses. A performance of Twelfth Night was only 10 per cent full and one of The Merchant Of Venice 23 per cent full.
The company will cancel its mid-scale tour, which plays in 800 to 1,000- seat theatres across the country. An internal report, leaked to The Stage newspaper, adds: "It is no longer possible to balance our budget without reducing the scale of our work. Base operations in Stratford and London will have to be secured. Ways have been looked at to restructure the budgets - some will be frozen, some will be cut."
The report continues: "Unfortunately, there will be no mid-scale tour in 1998, despite the huge success of Cyrano [a recently acclaimed production with Antony Sher]. We are hoping that we can convince funding bodies to correct our funding position to enable us to re-instate this tour in 1999."
The cancellation is a blow for RSC artistic director Adrian Noble, who passionately believes in taking the company around the country, claiming that is the remit of a national company.
A spokesman for the RSC confirmed last night that the mid-scale tour was being cancelled. He also confirmed the box-office figures, but added that a 64 per cent average "was something most West End theatres would be proud of and we are confident that the average figures for Twelfth Night and the Merchant of Venice will be healthier by the end of the season".
The company's troubles were due to a standstill grant from the Arts Council, he said.