Britain needs to show more gratitude to wealthy philanthropists who give money to the arts, leaders of major cultural institutions said yesterday.

Mark Jones, the director of the Victoria and Albert Museum and chairman of the National Museum Directors’ Conference (NMDC), said that Britain’s cultural heritage depended on a fundamental shift towards a culture of private giving.

Potential donors were said to be held back by offputting tax laws, by ignorance of how to get involved and by an often “curmudgeonly” and suspicious attitude towards people who give to the arts. Rather than celebrating the gift, he said, people often think: “What’s in it for them?”

The Government should reward prominent philanthropists with more honours and less tax, he argued. “We are less generous to donors than the Irish system, the French system or the Americans.” Mr Jones was speaking at the start of a campaign to encourage greater giving, backed by a report that lays bare the poor state of charitable contributions. The campaign is led by the NMDC, the Museums, Libraries and Archive Council and Arts Council England.

According to the report, Private Giving for the Public Good, there are 68 billionaires in Britain, and 100 new millionaires are created every day, yet charitable giving has fallen 25 per cent since 1992 as a proportion of gross domestic product.

Of the £9.5 billion donated last year, only a tiny fraction went to the arts.

Nearly 70 per cent of money given to culture goes to London and the South East.

Philanthropy UK, which advises aspiring donors, believes that the wealthiest 10 per cent of the population could double their giving. At present the poorest 10 per cent of the population give about 3 per cent of their income while the richest 10 per cent give barely 1 per cent.

The consequences for the arts, where public spending is throttling back after a decade of investment and the cost of acquiring art for public collections is rising rapidly, are potentially dire.

Private contributions have increased – subsidised performing arts groups now receive on average 36 per cent of their funding from the public purse as opposed to 51 per cent in 1980 – but more is needed, Mr Jones said.

“All the people in our sector realise we’re going to have to try harder than ever to attract private donations if we are going to compete effectively on the international stage. Government support has been very good but we can’t expect a great deal more of taxpayers’ money in the current economic climate.”

The report highlights the leading role played by private donors in creating the fabric of modern British cultural life. Philanthropy was integral to the founding of the British Museum, the Royal Shakespeare Company, the National Theatre, English National Opera and the Royal Ballet. Mr Jones said: “It would be good to recognise that we need to treat donors well. And there are some straightforward and practical things that government could do.”

He suggested handing out more honours to reward donors, expanding the Gift Aid scheme and treating donations as gifts for tax purposes even if they come with associated benefits such as invitations to private views.

The campaign’s top target is a change to the tax rules surrounding a donation of art to the nation.

“At the moment it is more efficient to give cash or shares than a work of art. If I have a Jeff Koons worth £10 million and I want to give it to the Tate, I get no tax relief. If I sell it and give the £10 million to the Tate I get tax relief at 40 per cent, so it only costs me £6 million.”

Mr Jones also said that he wanted to see the tax benefits associated with gifts of art to the nation made after death extended.

The acceptance-in-lieu scheme, which enables taxpayers to transfer works of art and heritage objects into public ownership and set their value against inheritance tax, has brought more than £250 million of works into the public domain in the past ten years. However, it excludes the most attractive donors: living ones.

“The gift of that first work of art is often the beginning of a lifetime’s engagement,” Mr Jones said.

“This is not about banging people over the head. Giving is a secret, misunderstood pleasure. If you want to be rich and happy, you need to give.”

Digging deep

— More than 1,500 people helped the refurbishment of the Royal Festival Hall, above, by paying at least £300 to name a seat

— The wealthiest 10 per cent of the population give less than 1 per cent of their income to charity

— The poorest 10 per cent of the population give around 3 per cent Individuals gave £9.5 billion to charity in 2006-07

— Global art prices have doubled in the past ten years

— Heritage Lottery Fund awardsfor acquiring works of art have fallen from £25 million to under £5 million in the same period

— In February the “extraordinarily generous” art dealer Anthony d’Offay sold his £125 million art collection to the nation for £26.5 million

Source: National Museum Directors’ Conference

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