At first glance the announcement by the Arts Council England (ACE) just before Christmas last year that they intended to increase funding to the arts by £50m was unarguably positive news. In a sector that has felt consistently sidelined by money promised to the 2012 Olympic Games, such a boost in funds was unexpected and much needed. It is astounding then that the organisation has succeeded in alienating so many in the arts world with its plans to distribute the funds.

A new strategy on funding arts, drawn up by former Edinburgh International Festival director, Brian McMaster in a government-sponsored review and revealed in January recommends the prioritisation of ‘excellence’. This, coupled with a focus on risk-taking and experimentation comes as a welcome change to an organisation which has, for so long, been distracted by ticking target boxes.

The declaration of a new approach, focusing on ‘self-assessment and peer review’ and moving away from a target-driven culture seemed to be a breath of fresh air. And yet, the last couple of weeks have seen the Young Vic pass a vote of no confidence in ACE, the actor’s union Equity, state that the council is not ‘fit to judge what is excellent in theatre’ and independent publishers petition against cuts and even threaten legal action against ACE. How can it all have gone so horribly wrong, when the current proposals offer funding increases to three-quarters of its existing clients and new grants to 80 organisations?

The furore in the publishing world has arisen over ACE’s decision to cut funding to several translational publishers, including Arcadia and Dedalus Books. While Arcadia are to see their funding cut by 25% after two years, funding for Dedalus Books will be cut entirely. Other translational publishing institutions to be affected by the cuts include Anvil and The British Centre for Literary Translation. The founding Managing Director of Dedalus, Eric Lane, accused the council of failing in its duty of care, depriving the company of any chance of survival and placing the outfit under the threat of bankruptcy. Dedalus has threatened legal action against ACE and is backed by an online petition containing over 800 signatories and the support of Julian Barnes and Ali Smith.

So what is it that these publishers have done to deserve the sudden withdrawal of support? It appears that Arcadia have been made victims of their own success. According to Gary Pulsifer, founder and MD of Arcadia, the letter from ACE announcing the proposed cuts suggested that the funding was no longer required following the success of Corinne Hofmann’s memoir, The White Masai, and the purchase of Black Amber, the Black and Asian list founded by Rosemarie Hudson.

There is a certain logic to this decision. After all, not everyone can be given funding and if Arcadia seem to have succeeded with the help of their support and look as though they are now able to stand on their own two feet, so much the better. Furthermore, in the case of Arcadia, the cut is only a reduction in funding, not a complete withdrawal, which suggests that the company is being encouraged to test its strength, rather than being left utterly without assistance.

The argument stands up until the reasons for withdrawing funding from Anvil are similarly considered. The ACE’s letter to Anvil stated that the company had been ‘identified as a high-risk organisation, due to a range of factors’. These factors included ‘the difficult climate for poetry slaes’ and ‘slow production’. While ACE commended the artistic quality of the work produced they noted that ‘marketing and distribution weaknesses have led to low availability of Anvil titles and a diminishing readership. Earned income from sales has fallen accordingly, leading to an over-dependence on ACE funding and serious concerns about the financial viability of the press’.

So Anvil are having their funding cut for the opposite reason to that given to Arcadia – because of a perceived lack of success. Poetry publishing is undoubtedly a difficult marked, but isn’t the ACE supposed to help arts foundations to weather the unpredictable climate of the arts market? Traditionally it’s role has been to set literary and artistic values, which are not in question in this case, above economic potential. After all, nobody makes money in poetry publishing, and if economic success becomes the criteria for funding the number of viable claimants will be sadly reduced.

Unfortunately, purely artistic values are now pitted against performance and value for money, so that Bloodaxe, which has seen it’s offer of funding renewed, and which publishes around 30-35 books a year is a more sound economical investment for the council than Anvil, which publishes just over a dozen.

Although the focus on economic validity is galling, most enervating to those threatened with cuts is the seeming lack of accurate research, the lack of transparency and the lack of a consistent policy for cutting funding within the council. Founder and MD of Anvil, Peter Jay accuses the organisation of having based their decision on out-of-date figures. He states that ‘2007 has seen sales rise…and we are better organised now than we have ever been.’ And the contradiction between rewarding and punishing success is baffling – Gary Pulsifer of Arcadia comments that ‘while the Arts Council must have a fully thought-out policy on translations, I’m not sure I’m au fait with it, though I thought we knew.’ Even the MD of successful Bloodaxe, Neil Astley admitted ‘everyone has been scared stiff; you can’t plan’.

All in all, what seems to have riled the arts community is not the redistribution of funds, but the haphazard manner in which the decisions have been made. ACE’s choices appear to be obscure, self-contradictory and even based on lack of relevant figures and research. Arts companies have to defend themselves against a sort of scattergun effect of negative and unfounded accusations, without being presented with a reasonable, rational and transparent set of aims to work towards in order to ensure funding.