There is a salutary lesson in arts funding from America.

New York’s Metropolitan Opera is cancelling expensive new productions and planning cuts in artists’ fees as a result of the credit crunch.

Relying as it does on endowments and donations, it has been severely affected by the financial crisis. The New York Times reported that the value of its funds had dropped a third from a high of $300 million (£200 million). There had also been a $10 million drop in donations and ticket sales were also likely to plummet millions.

The ramifications of the downturn for British art institutions are yet to become clear.

But the situation over the Atlantic should make one thing clear - if we believe the arts are a public good that should be made widely available, depending on private philanthropy to provide them is not the answer.

A typical major theatre company or art gallery in Britain already has a funding model that goes something like a third subsidy, a third sponsorship and fund-raising and a third ticket sales and other revenue.

Early signs are that many major sponsorship deals are holding up - for the time-being.

But everyone knows it’s going to get tougher.

And it would be unwise to bank on business backing in a recession.

The reality is that government subsidy will be needed more than ever.

Labour were bold in funding the arts to unprecedented levels in the last decade and that support has borne astonishing fruit.

But being bold in a recession would be even more impressive. e

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