After months of closure, we are welcoming only a fraction of our previous visitor numbers and this will remain the case for some time. As a charity, our activities rely on generating income through ticket sales, memberships, donations, and the profits from our shops and cafes. This money is used to run our four museums, care for our collection, and stage events and exhibitions across the UK and around the world. The current situation puts all of this at risk.
In normal times, Tate has to generate roughly 70% of the funding it needs – around £80 million last year – with the other 30% coming from Government. We are now facing a £50 million shortfall in self-generated income this year. Some additional Government funding will help, but it will not come close to plugging this gap. This means we are having to make some incredibly difficult decisions to ensure Tate can survive, including a dramatic reduction in the amount we spend across all our operations.
Tate Enterprises Ltd (TEL) is a separate business that runs Tate’s shops and cafes, with all its profits – £5 million last year – going back to supporting Tate as a charity. Tate is almost unique in using this model, as most museums contract out these operations to other companies instead. Covid-19 has hit retail and catering businesses particularly hard. With physical distancing measures in place and a long-term drop in visitor numbers, there is less demand for our services and we simply do not have the work in our shops and catering outlets to employ the same number of people as before. We have therefore had to take the painful decision to resize the business, and have now confirmed just over 300 redundancies. A small number of roles remain at risk of redundancy, and the outcomes will be known by the end of October,
Even with the savings from these redundancies, TEL is forecast to make losses of £5 million this year. It has only survived as a business due to cutting costs in this way, and with Tate allocating £5 million of support from the charity’s reserves. Without the support of Tate, and without having reduced the size of the business, TEL would no longer be financially viable and would have to close, with the loss of all its jobs. Given the even bigger drop in funding we face across Tate, we simply cannot afford to do more for TEL without putting the entire organisation’s survival at risk.
Of course this does not make it any easier for those valued colleagues we are losing. Throughout the pandemic we have done everything we could to support the people who work at Tate, including topping up the pay of all our furloughed employees to 100% throughout our closure. We are now making every effort to help those colleagues leaving us to find alternative employment, and offering preferential treatment if jobs become available in the future.
As with many other organisations, the situation we are in would have been unimaginable six months ago. But the sad and painful decisions we have taken are essential to ensure that we can fulfil our public duty to promote the right to art for everyone for many years to come.
Could Tate find more money to support Tate Enterprises Ltd, such as by selling assets?
Tate has allocated £5 million from the charity’s reserves to help ensure the business is able to survive. Without dramatically cutting costs through reducing the size of the business and without this financial support from Tate, TEL would no longer be financially viable and would have to close, with the loss of all its jobs. Tate faces a £50 million shortfall in self-generated income this year, and simply cannot afford to provide more financial support to TEL without putting its own survival and ability to fulfil its public duties at risk.
It is also not possible for us to sell assets such as artworks to raise funds. We are legally forbidden from, and morally opposed to, selling artworks from the collection, which we hold for the benefit of the public and on behalf of the nation.
Could Tate find other ways to cut costs to help save jobs?
The decision to make redundancies in TEL has only been made as a last resort. Across Tate we are taking steps to cut costs and to safeguard jobs wherever possible, with a dramatic 50% reduction in all our budgets, a recruitment freeze for all but the most essential posts, and a voluntary 10% pay cut for all Tate’s Executive Group. No one at TEL earns above £100,000 and all the senior team are taking pay cuts.
How is Tate Enterprises Ltd trying to generate income to help save jobs?
We are continuing to make great efforts to generate our own income through all means possible. This includes keeping shops and restaurants open where we can. But because we are only able to welcome a fraction of our previous visitor numbers, there simply isn’t the demand for the same number of shops and catering outlets as before the pandemic.
Without reducing our total number of employees in these areas we would be staffing empty restaurants and shops, and making additional losses that we simply cannot afford. Doing this would mean the whole of TEL no longer being financially viable, and having to close with the loss of all its jobs.
Have you asked the Government for more financial support?
Alongside our peers across the arts, we have passionately highlighted the importance of the cultural sector to Government. We are continuing to do this, ensuring there is focus on the critical need for ongoing emergency support given the devastating impact of the pandemic.
Are the redundancies being made fairly across Tate Enterprises Ltd?
The redundancies have affected all levels of the business, and we have worked hard to ensure that the changes are made in a way that is as fair as possible. This includes having discussed and agreed the selection process for retail teams with the PCS Trade Union.
Identifying and mitigating any impact on diversity has been an important part of the restructuring process, including undertaking an Equality Impact Assessment across Tate Enterprises Ltd. The proportion of TEL employees who have informed us they identify as BAME has not been impacted by the redundancies we have now confirmed.
What is Tate doing to support staff who have been made redundant?
Throughout the pandemic we have prioritised the welfare of our colleagues, including topping up the pay of all furloughed employees to 100% throughout our closure period. We are now doing all we can to support colleagues leaving Tate.
We have offered enhanced redundancy terms beyond the statutory minimum and are supporting in other ways such as through a scheme providing ongoing and comprehensive career development advice and support. Any colleagues made redundant have been invited to career webinars and will be offered preferential treatment in applying for any appropriate vacancies across Tate that arise until 31 August 2021.