Crisis-hit Dundee Contemporary Arts lost £381,000 last year as it pins its hopes on a rise in grant support.
The future of DCA hangs in the balance as new accounts show the scale of its financial challenges.
DCA had income of £2.6m but costs of £3m in the financial year to March 31 2024.
The DCA’s reserves fell to under £900,000 and it has continued to lose money in this financial year.
Its ability to continue to run art exhibitions, a print making studio and extensive schools engagement programme as well as its cinema rests on funding decisions being taken by Dundee City Council and Creative Scotland in the coming weeks.
Director Beth Bate said the loss was expected and agreed by its board.
She said: “We have to have any deficit agreed at trustee level, and it goes through serious scrutiny. Our core funders were made aware of that as well.
“It was agreed that, in the circumstances, it made sense to use reserves to help us meet the rising costs and the funding issues that we face.”
More cinema income but higher costs
The accounts show revenue from its two-screen cinema rose strongly from £338,000 to £515,000 as it benefitted from the Barbenheimer phenomenon.
Grants received were £1.1m compared to £1.4m in 2022/23, when it received an additional £377,000 Creative Scotland grant.
DCA’s staff costs rose from £1.5m in 2023 to £1.7m last year. Staff numbers reduced from 86 to 81 year-on-year.
Ms Bate said all staff received a 10.1% pay increase as the cost-of-living crisis impact was felt.
She said: “The pay increase was really about trying to address long-term wage stagnation right at the height of the cost-of-living crisis.
“Staff were telling us that they wanted to stay with us but they felt they may be forced to look elsewhere.
“The rise for everyone on the living wage was 10.1%. It became clear that a substantial rise was necessary (for all staff) to preserve our pay structure.
“We know that paying staff fairly is important if we’re going to say they are our most valuable resource, which they are.”
DCA funding future to be decided in weeks
The funding future for DCA is uncertain. Less than three months from the start of a new financial year, it does not know what grants it will receive from Scottish Government-funded Creative Scotland or Dundee City Council.
Its annual grant from the local authority, currently £232,000 a year, is under the spotlight as the council faces its own tough financial decisions.
Cutting this funding was presented as an option in a recent month-long public consultation.
The DCA warned “a significant reduction to or removal of this funding could lead to our closure and any cut will have an impact on jobs and creative programmes”.
It is also awaiting a decision on its largest single source of funding, Creative Scotland, which is funded by the Scottish Government.
Currently £666,667 a year, the DCA is pinning its hopes on a “significant” increase, which will be known later this month.
Ms Bate said: “If we were to completely lose our funding from Dundee City Council of almost a quarter of a million pounds and we received no uplift from Creative Scotland we’ve been very public about the fact this spells out an almost unimaginable future for DCA.
“We’re a very lean organisation. We’re constantly looking at all areas of the organisation to ensure we’re trying to work in the smartest and most efficient way possible.
“There is no shame in saying that we need public funding. This is an investment in the city and it pays massive dividends. Arts and culture always does. We have real social and charitable impact.”
Creative Scotland’s budget for 2025/6 is £89m, up from £66.5m in the previous year.
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