AIR

Arts Council England staff re-structure costs £7.3m - £2.5m more than original estimates.

The Arts Council's annual report for 2009/10 - undertaken in a bid to save £6.5m - has shown their staff re-structuring went massively over budget.

215 people took redundancy packages - 20 more than original predictions. What's more, as part of the process, 66 new staff were hired by the organisation.

The cost of the restructure was funded from money set aside by the Arts Council from its 2008/9 and 2009/10 grant in aid allocations. The rise in costs was due in part to the number of long-serving staff who took redundancy and therefore the higher associated redundancy costs, as well as additional payments to a pension fund.

Speaking to the Stage, a spokesperson for ACE said: ""In making such far-reaching changes to the structure of the organisation, and therefore to the majority of roles within it, a significant turnover of staff was always expected.

"Throughout the restructuring process the arts council tried to protect employees and keep costs to a minimum, by matching staff across to the new structure in all roles that did not undergo fundamental change. However, under employment law, when an employee's job description or responsibilities are fundamentally changed, they are entitled to redundancy.

In all such cases, Arts Council England gave employees the option to apply for other roles in the structure, or take redundancy. All one-off redundancy costs will be more than offset by the £6.5 million saved this year and every year going forward."

Due to the fact none of the redundancies were discretionary the ACE could not put a cap on the number of redundancies. Furthermore, because many of the roles changes significantly, staff holding them were automatically entitled to redundancy under employment law.

Jack Hutchinson

First published: a-n.co.uk August 2010