The Substation addresses NAC points on finances & autonomy over entire space, explains role as arts centre

The impasse is about whether The Substation would return as the sole tenant or a co-tenant.

Matthias Ang | Sulaiman Daud | March 06, 2021, 11:03 PM

The Substation (TS) has responded to the National Arts Council's (NAC) statement, which expressed disappointment over its board's decision to close the centre permanently.

In a press release on March 5, TS addressed several points made by NAC about its operational costs and perceptions about its operating model.

TS pointed out that NAC's statement about The Substation seeking autonomy over the whole of 45 Armenian Street, so that the centre could generate income from "venue hire", was incomplete.

It said, "We sought autonomy over the whole space so that we could continue to operate it as a multi-disciplinary arts centre and arts incubator."

What points did TS address?

Not an arts group, but an arts centre, similar to the Esplanade

TS highlighted that it is not an arts group but an arts centre similar to the Esplanade, albeit on a smaller scale.

Drawing a comparison, TS said that it dedicates most of its physical spaces to the arts, such as performing groups, at non-commercial, highly subsidised rates.

But it can also lease out other spaces for commercial use, such as its garden area to Timbre. The Esplanade does the same, housing restaurants and shops.

Also like the Esplanade, TS has employees who oversee building facilities and venue management, and it bears the related costs.

But unlike the Esplanade in "market positioning"

TS said that it caters to emerging and mid-career local and regional artists of all disciplines, citing its successful track record of producing several cultural medallion recipients and artists with international recognition.

It also disagreed with NAC calling it a "Major Company" which had received one of the highest amounts of government funding, at 86 per cent of its annual income, as an arts centre operates differently from a theatre, dance or music company.

Again referencing the Esplanade, TS said that it received more in grants from the government than its headline figure for deficit, i.e. over 100 per cent.

Manpower and programming costs are different from what NAC has stated

TS disputed NAC's given figures for its manpower and programming costs.

In the annex of its statement, NAC stated that TS's expenditure on programming was a "small proportion of total expenditure", at an average of 23 per cent for the financial years of 2017 to 2019, while it had incurred more than S$1.5 million in manpower and other operating costs.

On programming expenditure, TS said that based on the centre's published audited statements, the proportion of expenditure came up to 35.7 per cent for the same period instead.

TS made the point that there were different ways to look at programming costs as a proportion of total operating expenditure.

If one took into account the remuneration of employees involved in artistic programming (e.g. Artistic Directors and Programming Managers), this figure comes to 76.3 per cent.

TS again compared it to the Esplanade, saying headline programming costs for the Esplanade came up to 14 per cent of its total expenditure in FY19/20, citing the Esplanade's own annual report.

As for the S$1.5 million figure, TS explained that this was a sum incurred over the three financial years, which meant the average cost was S$500,000 per annum.

There is a difference between being a co-creator and a co-tenant

TS also discussed the difference between being a co-creator and a co-tenant, given that NAC said it invited the Board of TS "to co-create the vision for the renovated arts centre with us".

The statement also added that it welcomed TS's return as a co-tenant after renovations.

In response, TS claimed that NAC's letter of invitation made no mention of co-creation. Rather:

"The letter merely stated that The Substation, as a co-tenant, would 'be consulted to provide inputs for the future of 45 Armenian Street in relation to its precinct.'"

On one hand, if TS left 45 Armenian Street for good, its staff and programming budget would have to be "drastically reduced" even with NAC's financial support, assuming that it could not raise substantial private funding.

On the other hand, even if TS were to return to 45 Armenian Street as a co-tenant along with other groups, it would be a "diminished presence" in the building it had "occupied and defined for 30 years."

TS added, "The Board did not think this was the right outcome given the proud heritage of the Substation. We acknowledge the pain that many in the arts community feel about the decision we have taken. We feel the loss ourselves, profoundly."

Yeoh Lam Keong and Tommy Koh react

Former GIC Chief Economist Yeoh Lam Keong commented on the situation in a March 6 Facebook post referencing TS's statement.

Yeoh lauded TS's record of nurturing local artists, and said that NAC's decision to move TS without restoring their full tenancy and financial means of continuing their good work was "disappointing".

He also noted that TS's economic model has managed to sustain itself "in a steady and stable manner" for the past 15 years.

Meanwhile Tommy Koh, Ambassador-at-Large, penned an opinion piece in the Straits Times about TS.

Koh is a patron of TS, and the founding chairman of the NAC.

Koh noted that the main dispute is whether TS would return as the sole tenant or a co-tenant of the renovated building, and said he "understands and accepts" their decision not to return as a result of the impasse.

However, he also views their decision to rent out its coffee shop and garden to Timbre for rental income as a "serious error.

"But without the coffee shop, there was no place for artists to meet. Without the garden, outdoor concerts and other events could no longer be held. This contributed significantly to the decline of the centre," said Koh.

He also commented on its budget of only about S$1 million over 30 years, mostly derived from grants and rentals, and added, "Even before the impact of Covid-19, the failure to raise funds from other sources is partly a reflection on the leaders and partly due to the declining relevance of the centre."

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Top image from The Substation Facebook