For What it’s Worth: Measuring
Value & Impact in the Arts
Patrick Neeson
Department of Culture, Arts and
Leisure
1. My contribution to the debate
2. What is DCAL doing?
3. Some initial results
1. My contribution to the debate
“What do you get if you multiply six by
nine?”
“Six by nine. Forty two.”
“That's it. That's all there is.”
So, what are the values?
• Economic
• Social
• Individual
Economic?
What types of economic value /
impact might there be?
1. Spend by
organisations
Deliveries/distribution
Repairs &
construction
Catering/dining
Cleaning
Publishing/PR
1. Spend by
organisations
Need to be careful here
- is the spending carried out within the
jurisdiction or outside?
-the distinction is an important one
- I’ll come back to this in a minute
Training/Participation
2. Spend by
audience /
participants
Tickets
Meals and drinks
Equipment
Accommodation
Travel/parking
2. Spend by
audience /
participants
Need to be careful here too
- is it spend by tourists from outside the
jurisdiction or spend by locals?
-the distinction is an important one
- I’ll come back to this also
Economic Impact Study - Example
Impact calculations
Part 1. Spend by Audience
- 10,000 visitors to the show
- Everyone spends £100 on tickets, meals,
travel, etc, etc
Impact calculations
Part 1. Spend by Audience
10,000 x £100 = £1m
Impact calculations
2. Spend by Cast/Crew
- 100 cast and crew
- Average spend on hotels, meals, shopping,
etc per person is £5000
Impact calculations
Part 2. Spend by Cast/Crew
100 x £5000 = £500,000
Impact calculations
So, total spend =
£1m + £500,000 = £1.5m
Spend by
visitors
Spend by
cast/crew
Impact calculations
Part 3. Spend by Host
- Set design
- Production cost
- Make up
- Lighting
- Etc, etc
Impact calculations
Part 3. Spend by Host
- Let’s assume this totals £1m
PLUS – ‘Multiplier effect’ of spend
rippling its way through the economy
= £1m x 1.3 = £1.3m
Impact calculations
Overall Total =
£1.5m + £1.3m = £2.8m
Spend by host
Spend by visitors
+ cast/crew
But…
Part 1. Spend by Audience
- 10,000 visitors to the show
- Let’s assume 90% of these visitors were
‘local’ (i.e. within NI)
- Then only 10% of these visitors are
additional
But…
Part 1. Spend by Audience
- Therefore, only spend by 1,000 visitors is
additional
- In other words, the benefit of spend by
visitors =
1000 x £100 = £100,000 (Not £1m)
But…
Part 2. Spend by Cast/Crew
- 100 cast and crew
- Average spend on hotels, meals,
shopping, etc per person is £5000
- Let’s assume that most are from outside of
NI
so most is additional
However…
Part 2. Spend by Cast/Crew
- What was this money spent on?
- Where were the goods and service bought
sourced from?
Champagne, Kebabs and Bespoke Pillows
- Belfast Prepares For The MTV Awards
“A-list
celebrities and some of the top media executives in the US
will be here, so just how prepared is Belfast?”...
“MTV said that Belfast's hotels played a large part in their
decision to bring the awards here and at one of the city's
plushest, they're ready. They've painted the railings, polished
the door knobs, ordered in 500 extra bottles of bubbly and
fresh Italian truffles. “…
“Adrian McLaughlin, the manager of the Merchant Hotel, said they've had some strange
demands in the past: “Everything from a specific type of drink, maybe some off-the-wall
products that we have to get in from America.
“Some of them like the air conditioning to be at a certain temperature on arrival, others like the humidity to be
regulated, so we've had to bring in dehumidifiers and things like that for bedrooms, but as we say in the
hotel, we can do anything for anyone so long as its legal."
Part 2. Spend by Cast/Crew
- We only count the ‘Gross Value Added’ of
any money spent
- Typically, this is around 40% of gross
spend
Impact calculations
Part 2. Actual Additional Spend by
Cast/Crew
100 x £5000 = £500,000 x 40%
= £200,000
Impact calculations
So, actual total spend by visitors =
£1m + £500,000 = £1.5m
£100,000 + £200,000 = £300,000
Additional spend
by visitors
Gross value added
of spend by
cast/crew
What about..?
Part 3. Spend by Host
- We have to look at where this money was
spent and what it was spent on
- If spend leaks outside the local economy,
then this is a loss
Also – the Multiplier
Having a multiplier is fine but..
1. There is no straightforward read-across
from one place to another
2. Don’t assume its effect happens
instantaneously
3. In small economies, it is smaller
How does this affect our estimation of the
value of spend by the event’s hosts?
Remember,
We had estimated this was worth £1.3m
(£1m x 1.3 multiplier)
But, we now need to make the
adjustments that I mentioned
Impact calculations
Part 3. Spend by Host
- Original estimate = £1m x 1.3 = £1.3m
ADJUSTMENT 1: some of the spent will be on
goods and services that is outside NI
Let’s assume 30% leaks outside
So, only 70% of the £1m happens in NI =
£700,000
Impact calculations
Part 3. Spend by Host
ADJUSTMENT 2: we only count the GVA of the
spend
Again, assume 40% is GVA
Only 40% of the £700k spent locally is GVA =
£280k
Impact calculations
Part 3. Spend by Host
- Totals £1m
Let’s assume 30% leaks outside +
Only 40% of that spent locally is GVA +
Multiplier actually = 1.2
= £1m x 1.3 = £1.3m
= £280,000 x 1.2 = £336,000
Impact calculations
Actual Overall Total =
£1.5m + £1.3m = £2.8m
£300,000 + £336,000 = £636,000
i.e. only around 22% of the original
estimate
3. Other spend
by tourists
Because Belfast has a better cultural
offering, it will prove more attractive to
tourists
– they may not necessarily ‘do’ culture
4. Inward
Investment?
Because Belfast has a better cultural
offering, it might encourage more inward
investment
– executives in these companies want a
place to live in and bring up their families
4. Inward
Investment?
Cultural investment as a tool for
regeneration
Social?
What types of social value / impact
might there be?
Social?
• Could culture have an impact on society?
 Educational
Educational
Do we mean here that culture
will improve cognitive skills –
make children smarter in
other words?
Educational
Are there other types of
learning outcome?
Educational
Social?
• Could culture have an impact on society?
 Educational
 Health
Health
Does culture make us healthier?
Social?
•



Could culture have an impact on society?
Educational
Health
Others
Civic pride
Image
Reduction in crime
Community cohesion
Reduce
racism/sectarianism
Anti-deprivation
Improve well-being
“Social Clauses”
• DCAL aim is to maximise the social benefit
from investment
• Clauses included in procurement contracts
• Also maximise the social returns during
operation
Individual?
What types of value / impact might
culture have on individuals
Individual
•
•
•
•
We know that it exists but..
Difficult for the individual to identify what
the impact is
Difficult to measure this in any
meaningful way
Might vary over time, even for the same
individual
“Indifference Curve”
Other good
10 other goods + 3 cultural goods =
5 other goods + 6 cultural goods
10
5
3
6
Cultural good
Initial conclusions
1. There is value associated with culture
2. We shouldn’t assume that there is one
single answer in attempting to measure
this value
3. There are different types of value or
impact
4. We also shouldn’t assume that each
activity/good has the same impact
2. What is DCAL doing?
Department of Culture, Arts and Leisure
Social and Economic Research and
Survey Programme 2012 – 2016
Aims
• To strengthen the link between research, policy
development and service delivery within DCAL.
• To enhance the evidence base for the impact DCAL has
on the economy, health, education, social inclusion and
the environment.
• To provide improved co-ordination between the
Department’s and the Arms Length Bodies research
teams.
• To enhance interest within the research community in the
areas of research relevant to DCAL.
Research Programme - principles
• Recognises that there are different
approaches that can be used to attempt to
measure the ‘value’ in what DCAL does
• Building up the evidence base
Is the creative industries
a fast growing sector of the
economy?
What are the factors that
affect whether someone
participates in a cultural
activity?
Does household income
have an affect on
participation?
Can we develop a ‘cultural
tourism’ index?
Does participation in culture
impact on individual wellbeing?
DCAL RESEARCH
QUESTIONS
Can we develop a ‘cultural
deprivation’ index?
What current evidence is
available around impact?
What are the impacts of
DCAL health
programmes?
Can we measure the
‘willingness to pay’ for
cultural goods?
What are the impacts of
DCAL learning
programmes?
3. Some initial results
What are the factors that
affect whether someone
participates in a cultural
activity?
LESS LIKELY TO ATTEND A
LIBRARY
Does household income
have an affect on
participation?
MORE LIKELY TO ATTEND
Older people
Females
Those with children
Those in employment
Income on its own does not predict the likelihood of attending
In receipt of benefits
Own a car
The higher the educational attainment
Those in urban areas
Those who participate in other cultural
activities
•There were an estimated 1.2 million
participants in culture, arts and leisure
learning programmes in the time
period
•Over half of all programmes (52%)
were related to the curriculum with
10% accredited
•Over half of programmes contributed
to STEM (57%)
•Three-quarters of programmes are
available throughout all of Northern
Ireland
OUTCOMES
•Improved employability
•Acquisition of new learning
•Volunteer development
•Achievement of accreditation
•Increased confidence
•Offered opportunity to share skills and
experiences
•Increase in interest
•Curriculum connections and
integration into classroom practice
achieved
•Encouraged creativity
What are the impacts of
DCAL learning
programmes?
No evidence that arts changed attitudes of
marginalised students towards school;
Evidence that arts
Evidence that participation in arts could contribute
programmes impact on towards re-engaging marginalised students back into
social inclusion
education by changing attitudes towards learning
Some evidence that arts learning
programmes impact on behaviour
of marginalised students.
SOCIAL IMPACT OF
ARTS PROGRAMMES
What current evidence is
available around impact?
Inconclusive evidence
that arts programmes
would increase attendance or
participation in the arts.
“What is the average willingness to pay for library provision in
NI?”
Users
Non-users
£2.50 per
month
£2.50 per
month
Translates to a total annual
value of £42m
Can we measure the
‘willingness to pay’ for
cultural goods?
Can we develop a ‘cultural
deprivation’ index?
Conclusions
• Continue to develop the evidence base
• Recognise that there are different ways of
measuring different types of value
• BUT make sure it is carried out correctly –
for example, too many economic impact
studies done wrongly which overstate the
true economic benefit