Thursday, April 29, 2010
Time to face the music
Should artists and gifted performers and those who mind them be free of the cares and responsibilities that others must bear when it comes to accounting precisely for how taxpayer-provided dollars are spent?No, says the Audit Commission, which has laid out a score for a symphony of recrimination about musicians coming up short when handling the other sort of notes.
Yes and no, say people close to some artists and performers who might soon be feeling the heat of tight accounting.
The discordant report from the commission is on one of our most prestigious ensembles, the 85-strong Hong Kong Chinese Orchestra. About HK$50 million in public money was spent on the orchestra in 2009-2010, and it collected another HK$12 million through sponsorship and ticket sales.
Waving the baton of rebuke, the Director of Audit takes the orchestra to task for poor governance and loose auditing practices.
Complimentary ticket handouts and a tardy approach to working hours are highlighted as areas where musical performances fall disturbingly flat.
The criticism is being taken as a note of warning about how everyone in the art and culture sectors who enjoys the largesse of public and private funding will need to shape up.
Not least, it 's thought, will be super- strict standards applying as people jostle to benefit from the billions upon billions of dollars soon to be spent on creating the West Kowloon Cultural District and the programs and displays that will bring it to life.
For now it's the orchestra in the line of fire, though instead of trying to offering rebuttals after more than a week of rebukes it is adopting a stance of guarded quiet, apparently saving explanations for lawmakers in public accounts committee hearings. They are tuning up to discuss the Audit Commission report on May 11.The report is particularly scathing about complimentary tickets and, by extension, questioning the appeal at the box office - the place where people put their money where their ears are.
The orchestra gave out 5,262 complimentary tickets in 2008/09, which accounted for 12 percent of its audiences. Of these, 3,321 were purchased by the orchestra for giving away. They carried a market value of HK$830,000.
(The auditor noted the difference between giveaways, listing the other 1,941 as "free complimentary tickets.")
The commission is miffed not only by tickets being given free without clear rules governing the process but also by a failure to reflect the situation in the orchestra's accounts.
"The attendance rate based on the paid audience figure could have been overstated when the absence rate was high," it notes. "As compared with the Leisure and Cultural Services Department, which also holds a lot of cultural events each year, the Hong Kong Chinese Orchestra's complimentary ticket strategy is more generous and the monitoring system more relaxed."
A deal between the orchestra and the department specifies that for concerts at LCSD-run venues the orchestra will not issue complimentary tickets for more than 5 percent of seats unless there is a waiver in writing.
Normal practice, the commission states, is for the LCSD to issue only 50 to 60 "free complimentary tickets" to the orchestra for distribution.
(It's worth noting here the orchestra, founded in 1977, was previously under the wing of the department. Management passed to Hong Kong Chinese Orchestra Ltd in 2001.)
Before deciding that silence was the best tactic for now, the orchestra did start to address the matter of complimentary tickets, saying they went to diplomats, legislators, media outlets and minority groups to promote Chinese music.
The line about spreading the musical message is unlikely to mollify dollar- wise legislators who have taken on board the Director of Audit's words: "The orchestra needs to critically review its complimentary ticket strategy and monitoring system with due regard to the principle of prudence and good value for money ... "At the same time, it needs to explore more effective measures to promote concert ticket sales and ... explore more effective ways to promote Chinese music to the community in the long term."
Working hours is the other area of major concern in the report.
On average, musicians worked 43 percent less than what is specified in contracts: 703 hours, whereas it should have been 1,200.
Again, there's a call for managers to get on top of the situation. They should "closely monitor" the situation so artistic staff are "gainfully employed in accordance with the employment contract provisions."
And if there's time to play around because of spare musical manpower, the auditor suggests, then it should be spent on community outreach.
The orchestra did start to explain away some of the lost hours after the release of the report. Musicians also practice at home, it said, so calculations on working hours were not exact.
As with the tickets, silence reigned after that, but no doubt we'll hear more about missing hours when legislators get to grips with the issue.
Still, there are people who say you can't use figures alone when trying to assess the worth of an orchestra. To try to do so is unfair because musicians are not as a rule business-minded, says a leading figure in the sector, who spoke on condition of anonymity.
(We can say only this person is an executive of "another prominent orchestra" as these are "sensitive" times for art and culture and funding.)
The auditor's report has put pressure on other art groups, the executive says, with some fearing they are going to be a target.
"Not only the music field but art and culture groups that are heavily subsidized by the government must be panicking by now. All of them need to be very cautious in reviewing their audits to avoid following in the orchestra's footsteps."
On working hours, the executive says, it's normal for an orchestra to rehearse for slightly more than 20 hours a week, though just how many hours depends on the number of concerts. And many musicians practice for many hours at home every day.
As for the auditor's complaint about the orchestra: "Both the orchestra and its musicians should fully respect contracts that have clearly set out working hours. They should have made changes to the contracts if they were not happy with the terms in the first place. Being a musician doesn't provide an excuse to breach employment terms."
Leading art critic Lau Kin-wai, saying any organization using taxpayers' money should be open to scrutiny, echoes that view: "If the orchestra believed in the first place that working hours should not be fixed, they should not have set them out in the employment contracts.
"I don't see any reason for them to ignore employment terms. We're talking about musicians working 43 percent less than contracted hours. I really don't see any justification for such a big discrepancy."
While not pulling his punches on the orchestra, Lau is critical too of the government for being lax in monitoring how some of the funds it dispenses are used: it seems more concerned about demonstrating its willingness to spend on the arts and so ward off any criticism from lawmakers and pressure groups.
As long as an organization submits financial reports, he says, "the government does not really look carefully into where the money has gone."
Yet the orchestra is not without support as it faces the music. Chow Fan- fu, a prominent music critic and a member of a forum that advises the LCSD on arts programs, claims the Director of Audit used a wrong ruler to measure the orchestra's performance.
"You don't use rigid government criteria to assess a non-government body," he says. "That's wrong and unfair. The orchestra needs flexibility."
That was the reason it became a company rather than remaining under the government wing, and "it would be a step backward if the orchestra is required to follow government rules."
There was no problem with corporate governance at the orchestra, he went on, and the report was a case of the auditor picking on an organization.
Praising the abilities and team work of the orchestra that make it one of the world's best in Chinese music, Chow asked: "How can the orchestra be so well regarded if its governance is as poor as the auditor alleges?"
The media and the community have been misled by the auditor's report, he claims. "It's a shame that the orchestra, so highly regarded overseas, is now being picked on by our government. Our values are now based on money and figures, which is sad and a disgrace to Hong Kong."
After that broadside, lawmaker Paul Tse Wai-chun talks with a softer beat as he offers a degree of sympathy for the orchestra's travails: "Using a mechanical, numerical formula may not be fair as not everything can be quantified, especially when we are talking about art and culture. So the commission needs to strike a balance between quality and quantity when they make assessment."
Yet if "the issues the commission is digging into nowadays are usually very trivial - something as small as unused office equipment," Tse adds, the orchestra's problems could be serious, such as those complimentary tickets and musicians' working hours.
Aside from rights and wrongs in the case of the orchestra, Tse says, the report is a timely curtain-raiser for the cultural district.
Everyone involved, he says, will now be on their toes to demonstrate their awareness of the need for good governance.
But Tse is also looking for new thinking on paying for art and culture. The government should consider cutting its funding programs and encourage groups to seek private sponsorship, he says. "Maybe the pressure would help improve the performances of orchestras when they have to appeal to sponsors for funding. So the government could spare more resources for smaller groups."