THIS Friday, the Institute of Contemporary Arts announces its shortlist for the Becks Futures Prize 2005. Lower your quality threshold now. I don’t know if the ensuing exhibition will include cardboard boxes, inane videos or poster paint splashed on to canvas, but it will be supposedly indicative of a new, brilliant direction in contemporary art. The ICA has pulled off the dubious trick of equating “new” with “good ” for years but somehow the enthusiasm has begun to pall.

I love and hate the ICA, but while the institution’s friendly incoherence was once rather charming, if frustrating, something has changed. For decades, the ICA was where art and politics met headlong amid the cigarette smoke and beery haze, a place where Situationists clashed with Transgressive cinephiles, naked women rolled in paint and an artwork involving a mutilated lamb invoked a police raid.

“It opened your eyes and your mind and your heart,” recalls Julie Lawson, 76, a central figure in the running of the ICA from the 1950s. “The opportunities artists had there have been incredible. It wasn’t a case of ‘anything goes’, as the ICA had its own code of conduct. But it allowed you to make mistakes. The goal was to enrich your understanding. The place was physically dirty but it was a nice and interesting place to go.”

The dirt’s still there, but I wonder if it’s as interesting now. Founded in 1947 by a small bunch of liberal thinkers, the ICA has served up an impressive list of events, bringing artists and polemicists from all over the world to the attention of the British public, often for the first time. Look down the list of names of those whose work has received its British premiere at the ICA — Peter Blake, Joseph Beuys, Henri Cartier-Bresson, Raymond Williams, Julia Kristeva, Robert Mapplethorpe, Abbas Kiarostami — and you realise how easy it’s been to stand in the bar of the ICA and witness the emergence of superstars.

This, of course, is exactly why the tabloids have rubbished the place, declaring it to be a porn shop, a nest of extremists and scandalous drain on public funds. But then the ICA has not exactly helped its own reputation in the media.

In February 2002 there was the infamous episode involving the then ICA chairman Ivan Massow, who was forced to resign by the ICA’s council of board members after his less than tactful comments about the worth of a certain kind of contemporary art. Conceptual art by the likes of Tracey Emin and Damien Hirst was, he said, “pretentious, self-indulgent and craftless tat”. Emin was singled out for particular attack as someone who “could not think her way out of a paper bag”.

He had also criticised some of its supposed champions, including the Tate director, Sir Nicholas Serota, saying the British art world was at risk of “disappearing up its own arse”.

More recent revelations have surrounded Philip Dodd, the ICA’s outgoing director. “I don’t earn £90,000, I’m not going to live in China and I did not leave my wife,” he told me, in response to the more colourful charges laid against him. “Everybody wants to do what the ICA once did alone, which was to show the work of the next up-and-coming artists. The cultural institutions of the UK are more insular than they have any right to be. The majority of the world doesn’t exist for them,” he says, underlining how the ICA has brought work by people from different cultures to London.

Dodd has imposed effective financial discipline upon the ICA. Since he became director in 1997, its bankrupt bank balance has moved into a half a million pounds profit, audiences have tripled and there has been a 19 per cent rise in Arts Council funding, to £1.25 million for 2005-06. But when prodded about the state of its artistic programming, his answer is that the ICA is “untidy in principle and sits at odds with the disciplinary world of the UK”.

It’s a brave but inadequate way of excusing the increasingly incoherent range of activities hosted by the institution.

But when it comes to its film and talks programmes, I’m quite happy to see public money poured into the ICA. There is arguably a greater level of debate here than you’d find in any other arts institution in Britain. Where else can you have Anthony Julius talking on anti-Zionism and the late Edward Said on his life’s work? The ICA’s talks and film programmes have been insistently polyglot.

Yet while Turtles Can Fly, the latest film to come out of Iraq, exemplifies what the ICA does best — bringing foreign culture to us direct — other offerings are less impressive. The dismal exhibition 100 Artists See God looks as if it’s been curated over the telephone. Next month there’s a night of “skateboard culture”.

“When it was founded,” says Alan Yentob, ICA chairman, “there was a resistance to ideas from Europe and elsewhere. The ICA is interested in the rest of the world and is a melting pot for ideas. It’s not about sustainability. It shouldn’t think before it leaps necessarily.”

But when it comes to the ICA’s all too immediate embrace of transitory fashions in contemporary art, I beg to differ. Let’s hope that Jens Hoffmann, recently brought in as director of exhibitions, will apply some convincing critical filters to this programme.

The wider problem facing the ICA, however, is the gradual death of liberalism that we are currently witnessing. We live an era in which our tolerance for frivolity and faddishness is at a low ebb. Seriousness is back on the menu. It remains to be seen if the ICA can stomach it.

• Mark Irving is an art critic and a writer for Prospect magazine