Friday, February 17, 2012

The Drummond recommendations – pluses and minuses for Ontario’s cultural sector

With the release of the long awaited Drummond report, Ontarians can now see some options for how their provincial government might move from the generalities of fiscal restraint to the specifics of what it means for them and the services they count on. In its own words, the report paints a ‘profoundly gloomy’ future if Ontario preserves the status quo. It argues that thoughtful, fundamental reforms can change this.

The Report does not address the cultural sector specifically, but recommendations around overall spending, the relationship with the non-profit sector and the merit of refundable corporate income tax credits have direct and meaningful implications for Ontario’s arts, heritage and creative industries.

For the non-profit sector, including many arts and heritage organizations, the prospect of a re-defined relationship with government holds promise and opportunity. While resources can be expected to be reduced no matter which recommendations the Ontario government accepts from the Drummond Report, the recognition that more nimble, flexible non-profits can deliver service better and more efficiently is welcome news. There is the potential that administrative burdens will be lightened.

The biggest unknown for the cultural sector going forward is the Commission’s recommendation to sunset all refundable tax credits, including the array that supports the cultural and creative industries. Worth $268 million in 2009-10, these tax expenditures are central to the business model of the film, music and publishing industries in Ontario.

Stay tuned for interesting days ahead.