Analysis: English Heritage spins out into the world of charities

The stewardship of England's national monuments is going to be handed to a charity next year. Sam Burne James reports on the plans and interviews English Heritage chair Sir Laurie Magnus

Stonehenge
Stonehenge

In some ways, the quango English Heritage already looks, feels and operates like a charity. It benefits from Gift Aid on membership and donations to its charitable arm, the English Heritage Foundation, and has a large volunteer corps numbering more than 1,000 in 2012/13, up by a quarter on the year before.

So if part of EH - full title the Historic Buildings and Monuments Commission for England - becomes a charity as planned in April 2015, the existing foundation will be used as the vehicle; its purpose will just be extended from raising money for more than 400 major sites of English history to managing and taking care of them as well. It will also retain the English Heritage name and logo.

The part of the operation that carries the statutory duty to preserve England's wider historic environment will remain part of the commission under the new title Historic England; and the commission will divide the funding it gets from the Department for Culture, Media & Sport between English Heritage and Historic England.

A recent DCMS consultation, which closes on 7 February, says the charity will receive an initial eight-year licence to manage the National Heritage Collection and will continue to get government funding, in decreasing amounts, over that period, at the end of which it is expected to become self-financing. But half way through, in 2019, a review of licensing agreements and future contracts will take place.

The DCMS says English Heritage will not necessarily be the preferred bidder for future contracts. It says the review "will consider all options", including external tendering.

Responsibility to parliament

The commission will appoint the charity's board, a minority being commissioners themselves. English Heritage chair Sir Laurie Magnus says that, while state funds continue, "we have a responsibility to parliament because it's their money and any donor has the right to ask questions. Clearly, once it is financially independent, it's in an even stronger position." Recruitment to the board must be transparent, he says, with the independent majority of members being appointed after an open selection process. The chair's appointment will be confirmed by the trustee board in due course. Magnus says he would "very much like" to be its first chair, but it is not a done deal.

He says charitable status offers two advantages: freedom from "unbelievably complicated tendering processes that put off a lot of contractors"; and fundraising. "If you're part of the government, people wonder why the government doesn't pay for this," he says. "And quite often government says 'oh well, you've just had this legacy of £1m so we'll give you £1m less'. It's sort of counter-productive."

English Heritage is currently funded mainly by the government. But its grant is decreasing from £131m in 2010/11 to £90.7m in 2014/15 and £82m for 2015/16, charitable year number one. In each of the two coming years, £69.3m has already been allocated to Historic England, leaving the charity with £21.4m and then £13.3m.

In 2012/13, English Heritage's earned income, excluding fundraising, was £53.4m, which was up by 7 per cent annually from £29m in 2003/04. This includes earned income from sales, catering, hospitality, licensing, holiday cottages, car parking and rents. It is projected to rise in line with inflation, the consultation says, with some growth beyond that, given new commercial freedoms. It is expected to be £70.7m in 2015/16.

The part of EH that will become the charity, Magnus says, spends roughly £90m annually. Money, clearly, is relatively tight. However, as an organisation, English Heritage is said to be moving in the right direction - seven years ago, each visit to a site was subsidised to the tune of £1.43 by the public purse. Last year, each visit contributed 73p, which should rise to £1.32 for 2013/14. English Heritage currently brings in about £5.6m a year through fundraising, which is expected to rise to an average of £7.6m in the years between 2015/16 and 2023/24. This will be supplemented by an £85m up-front payment from the government when the new charity goes live, much of which will be used to deal with a backlog in conservation work. The rest will go into new capital projects and improvements to the visitor experience and amenities.

Is English Heritage financially viable as a charity? Some stakeholders say the consultation document is lacking in detailed figures. "I would completely agree it is light on the finances," says Magnus. "After all, it only goes out for two years with numbers. A business plan is fine for probably about three years out, and beyond that we need to get into the world of heavy assumptions." He says a more definitive 250-page plan, to be agreed with HM Treasury, is being finalised.

Duties and responsibilities

Some stakeholders are more concerned about the Historic England side of the plan. Loyd Grossman, chair of the Heritage Alliance, points out that the National Heritage Collection represents "a very small proportion, 0.05 per cent, of our protected assets". The consultation chapter on Historic England is less than three pages - or, as Grossman says, "relatively thin".

Historic England will continue to have the same duties and responsibilities towards England's wider heritage. The consultation says the split will "provide an opportunity to reassess priorities" and look at improving the management and delivery of heritage protection. Grant Lock, a senior heritage consultant at the planning consultancy Nathaniel Lichfield & Partners, says the new identity for Historic England is positive because it clarifies the roles of English Heritage and engages the public more. This goal is described in the consultation.

The new model is uncharted territory, but there are two comparable precedents. One is Historic Royal Palaces, now an independent charity looking after the Tower of London, Hampton Court and three other London royal palaces. The DCMS made it a charity in 1998 and it has an eight-year licensing agreement that is similar to the one English Heritage will have.

The other is British Waterways, which became the Canal & River Trust in 2012. Its chief executive, Richard Parry, told Third Sector in October that spinning out as a charity had "enormous benefits" and called English Heritage's plans "a vote of confidence in us". As he noted, English Heritage chief executive Simon Thurley is a Canal & River Trust trustee. However, the Canal & River Trust says that it has "had no direct input into any discussions" about English Heritage.

Tourism competition

Another concern for the sector is the extent to which English Heritage brings increased competition. Grossman says tourism can be quite competitive at local level, but hopes that the new charity will take a strategic view and continue to engage in joint promotion partnerships. "It may depend on the financial demands of the new charity, but I'd hope it will take an altruistic approach," he says.

Ingrid Samuel, the National Trust's historic environment director, hopes for cooperation. Samuel and Magnus - formerly deputy chair of the trust - agree that the trust and EH have a good relationship. "In fundraising specifically, we have a very good relationship to ensure we don't put ourselves in competition with each other, and we would hope to continue that," Samuel says.

Mark Phillips, managing director of the fundraising agency Bluefrog, says English Heritage should have little problem raising money or gaining members. "People like heritage, and if you manage it and package it right I'd say they'd have no problem," he says. He also suggests that English Heritage's existing strategy of soliciting donations for individual properties, projects or works of art works better than general appeals.

Of English Heritage's 1,850 full-time equivalent staff, current forecasts show that 1,170 staff working directly on the National Heritage Collection will move under transfer of undertakings legislation to the charity on the same terms and conditions, including the Civil Service Pension Scheme. Staff in corporate functions will remain employees of the staff body, but they will be contracted out to the charity as required.

Mike Hodgson, until recently the English Heritage representative at the Public and Commercial Services Union, is cautiously optimistic. "The wording is that our rights and employment conditions are being honoured," he says. "There's still a long way to go; we have to see what happens. What we're not getting is a lot of detail, but then I think a lot of detail hasn't been set out yet."

What is English Heritage...?

The Historic Buildings and Monuments Commission for England, known as English Heritage, is the government's statutory adviser on the historic environment and a non-departmental public body sponsored by the Department for Culture, Media & Sport.

English Heritage's responsibilities are set out in the National Heritage Act 1983 and it has the power to prosecute offences under the Ancient Monuments and Archaeological Areas Act 1979 and the Planning (Listed Buildings and Conservation Areas) Act 1990.

The organisation's most prominent role is caring for and keeping open to the public just over 400 sites across England, known as the National Heritage Collection. Each year the organisation also advises on 17,000 planning applications and gives out £24m in grants.

English Heritage has nearly 750,000 members who generally pay £48 a year, or £1,050 for life membership. In comparison, the National Trust has four million members who pay an annual membership fee of £55.50 or £1,350 for life. The National Trust is five times the size of English Heritage and owns countryside and 700 miles of coastline in England and Wales.

Sir Laurie Magnus, chair of English Heritage, says: "Most of our properties don't have roofs, so it is a very different portfolio from that of the National Trust.

"The other thing to remember is that if you're looking at the whole heritage sector, it operates a whole lot more than English Heritage and the National Trust put together."

... and what has it got?

The collection includes:

59 prehistoric sites, of which the best known is Stonehenge in Wiltshire.

56 Roman sites, including 20 parts of Hadrian's Wall, which is a World Heritage Site.

116 castles and forts: Bolsover, Carisbrooke and Dover are among the best known.

32 houses and gardens, including Eltham Palace and Kenwood House in London.

90 ecclesiastical sites, including Furness Abbey in Cumbria and Whitby Abbey in Yorkshire.

58 statues and monuments, including the Cenotaph on Whitehall.

34 domestic medieval buildings.

Plus Industrial heritage, including the JW Evans silver factory in Birmingham, historic bridges, great barns, deer houses and cold war bunkers.

Currently, 130 English Heritage sites charge for admission. Its chair, Sir Laurie Magnus, says this will not change, apart perhaps from one or two cases, when it becomes a charity.

- Read our interview with Sir Laurie Magnus


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