The humiliation of the much-criticised Opera House management will be emphasised by the words Royal Opera House being physically scratched out by stone masons from the front of the building.
Equally important, the English National Opera will be leaving the London Coliseum and London will no longer have two grand scale opera houses.
Mr Smith said last night that under present public funding, London could no longer afford two opera houses. Asked if it was not his job to fight to increase that funding, he replied: "I am a realist."
He also emphasised the Government's determination that London's flagship national companies become truly national. He said the Royal Opera, Royal Ballet and ENO would spend far more time touring the country and mounting educational activities.
As the cultural establishment struggled to take in the most dramatic arts intervention by Government, effectively driving a coach and horses through the arm's-length principle of running the arts through the Arts Council quango, it was clear that the Government had had enough of the Royal Opera House's shambolic management of their pounds 15m a year public funding and pounds 78m Lottery grant.
Last week a select committee chairman labelled that management "incompetent", and their peripatetic existence during the House's closure "shambolic".
Under Mr Smith's plan, the ROH will become merely a receiving house, embracing the ENO in its fold with all three companies having their own boards. The positions of Lord Chadlington, ROH chairman, and Mary Allen, chief executive, were unclear.
Mr Smith has appointed Sir Richard Eyre, former artistic director of the National Theatre to lead a review and "radical reassessment" of the Covent Garden site. But his letter to Sir Richard setting out the basis of the review spells out in dramatically clear terms the scenario the Government expects to achieve.
Mr Smith told Sir Richard: "In particular I would like to see the work become more accessible to all of us, whether through more touring activity, through education work or broadcast opportunities. I believe it is also right to ask hard questions about value for money."
Mr Smith said last he had agreement from both the chairmen of the ROH and ENO for his proposals, though there was speculation that they were given little choice. All three companies have been told that under Mr Smith's plan they will not see a reduction in funding.
Contentious matters like seat prices will be addressed by Sir Richard's review.