Over the last six months key players from both groups have threatened to leave the Opera House for good. But now, as a result of a deal brokered personally by Chris Smith, the Secretary of State for Culture, Media and Sport, the new chief executive at the theatre, Michael Kaiser, can expect to have as much as pounds 10m extra to spend over the next three years.
Earlier reports that the ROH grant would go up by 40 per cent were exaggerated, but the new cash will be enough to infuriate the heads of institutions like the Royal Shakespeare Company that have been competing for the same funds.
Concern about spending on the arts has led to the announcement tomorrow of a powerful new art watchdog, Quest, or the Quality, Efficiency and Standards Team. The body will audit government-funded arts organisations to ensure they are not wasting money. It will have wide-ranging powers to investigate their activities, monitor accounts and interview administrators to ensure they are reaching efficiency targets.
When the Opera House - where tickets can cost as much as pounds 260 - closed last July for its pounds 214m, lottery-funded re-building work, it was pounds 7m in the red, a figure that will rise to as much as pounds 25m by Spring, despite most of next year's shows, due to go on at host venues like Sadler's Wells, being cancelled to save money.
Benefactors Lord Sainsbury and Vivien Duffield, have both railed against the cancellations and music director Bernard Haitink at one time tendered his resignation.