After formally announcing that The Substation would be closing for good, the National Arts Council (NAC) released a media statement in response, which The Straits Times and other media have reported on.
The Substation have noted several misconceptions or incomplete remarks in NAC’s statement, to which they have released a further statement clarifying issues such as its position as a venue, funds and finances.
Here is the statement in full:
1. We refer to the NAC’s Media Statement on the Permanent Closure of the Substation, and would like to respond to a number of the points made by the NAC.
The statement that the Substation sought autonomy over the whole of 45 Armenian Street “so that it could generate income from venue hire”, is incomplete. We sought autonomy over the whole space so that we could continue to operate it as a multi-disciplinary arts centre and arts incubator.
2. To reiterate, the Substation is an arts centre; we are not an arts group. The financial and operating models of the two are very different.
In Singapore, the Esplanade is an example of an arts centre1. The Substation is a similar animal, albeit on a much, much smaller scale. As the operator of an arts centre, we have autonomy over our physical spaces, which we dedicate primarily to arts usage. We attract and can select suitable hirers (e.g. theatre, dance and music groups), both short and medium term, which provide a “community effect” at the space, over and beyond their revenue contribution.
Just as the Esplanade, there are spaces within the building which we will lease out for commercial use (for the Esplanade, its restaurant and retail spaces, and for us, the garden area which was occupied for several years by Timbre), as well as for use by arts groups at non-commercial, highly subsidised rates (such as our dance studio).
Just as the Esplanade, we have employees who oversee building facilities and venue management, and we bear the costs of property maintenance and utilities.
Besides scale, we differ from the Esplanade in our market positioning as we cater to emerging and mid-career local and regional artists of all disciplines. Our track record of fostering cultural medallion recipients and internationally recognised senior artists attests to the enduring success of this community effect.
3. NAC mentions in its Media Statement the Substation’s reliance on “government funding of an average of 86% of annual income, the highest among NAC’s Major Companies”.
We do not agree with the comparison with other Major Companies, as the operating model of an arts centre is very different from that of a theatre, dance or music company.
Again, by analogy, the Esplanade’s headline figure for deficit before grants was $54,184,000 for FY19/20, and its grants for the year and government subvention-rental of property in aggregate amounted to $56,155,000 in FY19/20 (i.e. more than 100% of its deficit before grants).
4. The NAC mentions that the Substation’s “expenditure on programming has been a small proportion of total operational expenses, at 23% on average from FY17-FY19. In contrast, The Substation has incurred more than $1,500,000 in salaries and other manpower costs.”
First, we would like to clarify that our manpower costs of more than $1,500,000 referred to by the NAC were incurred over a period of three years i.e. the costs were on average just over $500,000 per annum between FY17 and FY19.
We presently have 11 employees in total: two Artistic Directors, one General Manager, one Facilities Manager, one Caretaker, two Technicians, one Cleaner, one Admin Manager and two Programme Managers. We believe in paying fair wages to our employees, and we certainly do not overpay them. Indeed, we believe our employees turn down higher paying jobs in the arts market for the “symbolic remuneration” of working at the Substation.
Second, based on our calculation using our published audited financial statements for FY17 to FY19, our programming costs as a proportion of total operational expenses was 35.7% on average for the said 3 financial years (and not 23%). We would also point out that there are different ways to look at expenditure on programming as a proportion of total operational expenses. If you include the remuneration of employees whose work encompasses artistic programming, such as the Artistic Directors and Programming Managers, as part of programming costs, our percentage of expenditure on programming as a proportion of total operational expenses increases to 76.3% on average for FY17 to FY19.
For reference, the Esplanade’s headline programming costs amounted to 14% of its total expenditure in FY19/20.
5. We would like to stress that when we make references to the Esplanade in this Press Release, we are not doing so to criticise or critique its financial or operating model, but rather citing it as an example and illustration of the financial model for an arts centre (such as the Substation).
6. NAC refers in its Media Statement to having “invited the current Board to co-create the vision for the renovated arts centre with us”. For full transparency, the NAC’s letter to the Board dated 17 February 2021 did not refer to “co-creation”. 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”.
7. In conclusion, the Substation is an arts centre. The essence of an arts centre is autonomy of physical spaces such as a theatre and gallery for artists to make their art and interact. Once the Substation vacates 45 Armenian Street, taking into account the financial support offered by NAC, and on the assumption we are unable to raise substantial private funding6, we would have to reduce staff by more than half, and our programming budget and bandwidth would have to be drastically reduced. We believe that this would severely impact the Substation’s mission to nurture younger artists. The consequence of this is not merely a tweaking of the Substation’s vision, but a drastic divergence from its original mission. In other words, the Substation will no longer be the Substation as we know it.
8. While NAC did say the Substation could return to 45 Armenian Street as a co-tenant with other groups, it would still have meant the Substation could no longer operate as an arts centre, our raison d’être. Even if we had returned to 45 Armenian Street after the renovations, the Substation would have been a diminished presence in the building that it had occupied and defined for 30 years.
9. 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.
– The Substation
The Substation will close permanently sometime in July 2021. More information available on their website here
SeptFest takes place from 4th to 28th March 2021. Tickets and more information available here