RSC Faces Cash Crunch

THE Royal Shakespeare Company, to many the world's greatest name in theater, is in crisis. At a Feb. 8 press conference, a somber Terry Hands, RSC artistic chief, said that for the first time the renowned rep will close its two London-based theaters for more than four months, beginning in November.

Mr. Hands, who is soon to leave the company after 25 years, including five at the helm, also announced that the RSC is canceling the annual regional tour which brings quality theater to areas of the country without an established repertory company. The only glimmer of good news is that the RSC's Stratford-upon-Avon operation will be unaffected.

Despite such international hits as ``Nicholas Nickleby,'' ``Les Mis'erables,'' and ``Les Liaisons Dangereuses,'' lack of cash is the company's problem. It is estimated that by the end of the current fiscal year in April, the RSC will have an accumulated debt of 2.9 million pounds ($4.8 million).

Hands insists that the money troubles are due largely to the British government's failure to keep the company's grant, which now amounts to 31 percent of its total running costs, in line with inflation. He points to the Priestly Report, published six years ago and based on a government investigation into the RSC's finances. The report concluded that the troupe was well-run but required more state money to maintain viability. If the government had followed the advice of the report, observes Hands, there would be no financial crises for the RSC.

Hands remains guardedly optimistic about the company's future. ``I do believe a party that has remained in power for 10 years is perfectly capable of reassessing its policies,'' he has maintained publicly.

There is, of course, an alternative view about the reasons for the pinch. Despite packed houses for some of its current productions, including the first stage version of the controversial ``A Clockwork Orange,'' overall RSC attendance has slipped in the last year to 75 percent of capacity, and some shows have played to less than 50 percent. The company needs the extraordinarily high average of 85 percent to break even. Lack of funds to lure top stars is one of the reasons cited for the slippage, but the company's artistic decisions have sometimes been questionable.

There has also been much criticism over the RSC's foray into musicals. The oft-repeated cry is that the troupe has lost its identity in its pursuit of commercial success. That it should return to its original purpose - to keep the classics alive and present only substantive new dramatic work.

Hands disagrees. ``...Our identity should include the practice and exploration of musical theater,'' he told me a while back. ``And we are exploring an art form that we would like to get better at.'' Hands also believes that times have changed since the RSC was founded: Today there are many more places where people can see good Shakespeare and other classical works. The RSC has trained a lot of theater talent and cultivated audiences for the classics bring about that situation.

But the present malaise has deeper roots. For the last 45 years, British performing arts have flourished under a system of state subsidy. Companies worldwide, particularly in America, have looked longingly at the comparative stability of British cultural institutions, which has allowed them to reach trend-setting standards of excellence.

In theater, for instance, London rather than New York is often considered the stage capital of the world. Such preeminence is, in no small part, due to the two state-subsidized repertory companies: the RSC and the Royal National Theater (RNT). Of the commercial shows in the West End right now, at least half were originated by the RSC or RNT.

The prevailing view of successive British governments has been that the performing arts were too important to the health of the nation to leave solely to the vagaries of a free-market economy. But during the 1980s, this assumption has gradually shifted, in line with the monetarist policies of the Thatcher government.

As a result, financial troubles among British cultural institutions are rife. The Royal Opera House and the English National Opera, for example, are running seriously in the red. The English National Ballet had to be saved from total collapse by an 11th-hour injection of state cash.

Along with most of his colleagues in the British arts world, Hands is deeply worried by current policy. ``The RSC cannot be in a situation anymore,'' he says, ``where our revenues from [business] sponsorship or from [commercial transfers] are merely to ensure our survival. They should be extra; they should be reserve funds; they should enable us to develop our work better, to pay our people better, to go to places where at the moment we can't afford to get to, to spread our work. I believe passionately that the time has come for a revision of government policy.''

Caroline Kay, deputy director of the Association for Business Sponsorship of the Arts, concurs. ``Business entered into arts sponsorship on the understanding that it would be a partnership between commercial and government funding,'' she notes, ``not a source of revenue for patching the roof or mending the lavatories. There has been a disenchantment among businesses, particularly in the last year, that the government is asking them to do everything for the arts.''

Hands claims he has taken drastic measures now to save the company from folding altogether at a later date. Given the damage a four-month shutdown of the RSC's London base will do in terms of revenue, morale, and public image, Hands is clearly hoping that the government will come to the rescue.

But a spokeswoman for Arts Minister Richard Luce offers little comfort. ``The minister ... feels that the 11 percent recently given to the RSC was a substantial increase of money, in excess of inflation, which is currently around 7 percent. There is no more money coming from the government.... In a way, the RSC's problems are those of their own making. They have known since 1987 how much money they would be granted three years in advance and should have planned accordingly.''