Art fund pledge to raise pounds 20m turns to ashes

IT BEGAN with a bangers-and-mash supper at the Financial Times printing works for the glitterati and literati. David Hockney was there, along with Sir Richard Attenborough, Joan Bakewell, Jasper Conran and Loyd Grossman.

Armed with a pounds 1m bequest to the Arts Council, the new Arts Foundation promised prizes, special shelves in shops for the foundation's choice of literature, a salon des refuses for works of art rejected by everybody else, a writer's retreat and, within three years, pounds 20m to be raised for the arts.

Today, the three years are up. The original director, Stephen Bayley, known for his exhibitions on Coca-Cola bottles and Ford Sierras, and the first chairman of the trustees, Lord Palumbo, have both quit. The glamorous first offices in Chelsea Harbour have long been vacated, and the foundation is now run from the Countess of Huntingdon's Chapel in Bath. Nor is there any sign of pounds 20m. So far fund-raising has brought in just pounds 4,000.

The story of the Arts Foundation has dismayed many in the arts world, who are desperate for funds. It is also, in the week that the Camelot consortium was selected to run the National Lottery with predictions that pounds 1.6bn would be raised for good causes including the arts, a salutary tale of how good intentions are not enough in the world of fund-raising.

The Arts Foundation was launched on 29 May 1991 after a Swiss banker, Francis Hoch, left pounds 1m to the Arts Council. Under the auspices of its chairman, Peter Palumbo, the council decided to hive off the money into a new foundation to provide, in the words of its launch statement 'a multi-million-pound endowment fund to encourage new work in the arts . . . to revive intelligent patronage. The foundation is committed to innovation, rather than to the established repertoire. . . . A major fund-raising drive is under way with a target of pounds 20m in three years'.

Within its first year, it raised just pounds 1,000. Its annual accounts for 1991 reveal that it spent pounds 145,000 on administration - almost three times as much as it handed out in grants - and ended up almost pounds 55,000 over budget. The 1992 accounts showed a slight improvement. Administration cost pounds 71,319; grants of pounds 48,369 were made, and donations rose to pounds 3,000.

Stephen Bayley left the foundation at the end of 1991 and was replaced by Russell Willis Taylor. She devised a new scheme of fellowships to be awarded annually to six different art forms. No open applications for these fellowships were accepted. Instead, 40 nominators across the country would suggest deserving artists. In 1993 the sectors chosen were sculpture, ceramics, photography, poetry, playwriting and multi-disciplinary arts.

However, the Arts Foundation's activities remain little known - even in these sectors. A spokesman for the Photographers Gallery in London said: 'Nobody here has heard of them or knows what they do.' At the Poetry Society, a spokeswoman said: 'Nobody's heard of the Arts Foundation.'

Prudence Skene, current director of the foundation, maintains that the organisation will succeed in raising funds when it has developed a successful programme of fellowships.

'We have got to have a formal approach. Until we have a successful programme it will be difficult to fund-raise. Proposals like the salon des refuses and the writer's retreat were ideas of the first director. What we are trying to do is support innovation and creativity.'

Among the foundation's sternest critics is Philip Hedley, of London's Theatre Royal, Stratford East, who describes its formation was 'laughable'. He said: 'This money was given to the Arts Council. We did not expect it to be hived off into a separate organisation. Since it was formed it seems to have cost a huge amount of money to run. At a time when the arts are suffering from severe cuts, why not give back the money to the Arts Council and let it be used for vital projects and schemes?'

Ms Skene rejects this proposal. The Arts Council says it no longer has any involvement in the foundation, even though the money used to set it up was originally left to the council.

Stephen Bayley said he did not wish to comment on the organisation he launched with such optimism. 'Anything to do with the arts is a rat's nest of ignorant bitchery.'