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LAYING BARE THE BALTIC

Inside the BALTIC - but where has all the money gone?

Inside Out presents a special report uncovering some of the financial secrets of Tyneside's new BALTIC art gallery.

We've been stripping down the art factory's finances to find out how it has worked its way through 拢60 million of public money.

It's been spend, spend, spend at the BALTIC over the last three years, with major investment in the refurbishment of the building and the cost of art commissions.

The Lottery contributed 拢47 million to set the BALTIC going, and the gallery was hailed as a huge step forward for Tyneside's cultural regeneration.

Every year the government continues handing over a couple more million to help fund the BALTIC's 拢4 million running costs.

But Inside Out has uncovered evidence of cash being sloshed around like an Impressionist painting.

Tyne Bridges

Let's take that favourite Geordie landmark - the Tyne Bridge,
and the replica which the BALTIC commissioned from American artist Chris Burden for its opening exhibition.

Chris Burden set about building the replica bridge in his studio in California after being offered somewhere in the region of 拢100,000 by the BALTIC.

The man behind this generous offer was Sune Nordgren, the founding director of the BALTIC, hired from his native Sweden.

Chris Burden wasn't Sune's only choice of bridge builder. Before commissioning the replica, he got in touch with the North East Meccano Association.

Ian Mordue from the Meccano group was naturally excited, "The Director rang us. He said he would like, if possible, for us to construct it in situ in BALTIC so people could see it going up over a period of six to eight weeks."

"I sent details of how we would schedule the building, and we heard very little from the museum.

"I had to ring them and I was told that the artist had decided to build it himself at his workshops in California and get it shipped over as a completed item."

The Meccano Association believed that they could make the work for $25,000, which covered the costs of the parts.

But Sune Nordgren rejected the cut price deal which would have worked out at about a fifth of the cost of Burden's version.

Inside Out has also discovered that the generous Nordgren could have got some of our 拢100,000 back but, according to some critics, he left that to luck.

On the dotted line...

When a gallery asks an artist to put a work together, the usual rules of engagement are that the gallery issues a contract.

It says in black and white that if the work is sold, the gallery can claim back the costs of putting it together.

This is the advice given by the Arts Council - which in turn funds the BALTIC, as James Bustard explains:

"We recommend a very clear position - that the organisation should seek to recover the production costs".

So did Baltic's founding Director play by the rules?

Andrea Rose was brought onto Baltic's board of trustees because of her expertise and experience in the art world.

She says, "The gallery has to pay for the actual fabrication of the work in order for it exist in the first place.

"We told Sune that there was actually nothing wrong with that, provided in a contract with the artist any subsequent sales of that work incorporates a clause that says that that money should be reclaimed by the gallery - and Sune just wouldn't listen to that."

Andrea even went as far as giving Sune a helping hand - providing examples the necessary paper work.

Burning all its bridges - how did BALTIC lose track of the Tyne Bridge?

However, the work disappeared at the end of the show, and it was presumed that it was doing the rounds at the exhibitions around Europe.

Ian Mordue says, "From the internet, I now understand that the artist is actually selling it."

Inside Out has had a tip off that Chris Burden's Tyne Bridge has now been sold for 拢400,000.

Some simple research led Inside Out to Paris to the headquarters of the Louis Vuitton Corporation where we found Chris Burden's bridge.

It had been sold to the handbag and suitcase company as far back as May 2004.

But isn't that long enough for the BALTIC to realise that they should start chasing the money which they put into making the bridge in the first place?

Paper chase

Inside Out has also discovered some interesting paperwork - a scathing memo from the Arts Council, written shortly after the BALTIC opened after Sune Nordgen had spent hundreds of thousands of pounds on art:

"There are no artists' contracts and we were informed that the programmes do no always comply with the financial regulations."

The Baltic's Chair at the time was Alan Smith who responds to the criticisms, "It's not that there weren't any contracts at all, that's not fair to say.

"There were contracts in place. I think some of the contracts probably needed tightening up and that was one area we did look into....

"I've no doubt that some of those contracts were such that costs were going out of shape at certain points in time... and that's what I think the Arts Council were focusing our minds on."

However, so far no money has been returned to the BALTIC with the sale of Burden's replica Tyne Bridge.

Domain Field

Another of Sune Nordgren's memorable commissions was Antony Gormley's Domain Field, where hundreds of people were plaster casted and then turned into a series of metal statues.

The exhibition certainly grabbed the headlines, but behind the scenes things began to unravel as the costs spiralled out of control.

Inside Out would like to tell you exactly how much Domain Field cost - we have heard figures ranging from 拢300,000 to a staggering 拢800,000.

Domain Field - but what huge success but at what price?

The truth probably lies somewhere in between, but the BALTIC say that this is a commercial secret.

What we do know is that it went dramatically overbudget from a
memo written by Alan Smith in spring 2004.

Under the heading "No Contracts in place with Artists", it says:

"There is a "massive overspend on nearly all commissions - especially Kapoor, Burden, Gormley and the Wilson twins."

It goes on to say that there's a "worrying possibility we could be 'taken for a ride'".

Inside Out asked Alan Smith about this memo and this is what he said:

"If you don't have a fixed price contract in place, then there's a possibility that contract will go out of shape and costs will increase."

In the case of Domain Field, sculptures, like these, have recently sold for 拢60,000 each.

If the 250 Domain Field works were to sell, the BALTIC should be in for a bit of a windfall if, and that's a big 'if', Sune Nordgren sorted out the right paperwork.

Alan Smith defends the board's position, "As a board we knew there was overspend on some of the contracts. And we know why because the director articulated these to us at each meeting.

"But I can't recall for every commission, why costs had gone up."

However, the Director was told to put things in order, as Alan Smith explains:

"We were there barking and shouting and biting as best we could, but to change things sometimes takes time. Sometimes it takes a change in regime to get those changes in place."

Financial crisis

Sune Nordgren left the BALTIC in the Summer of 2003 with the gallery facing a bit of a financial crisis.

In an earlier memo to the Arts Council Alan Smith says:

"The Director of the Arts Lottery is convinced that Sune, having spent a boatload of money, will walk out leaving a financial black hole and an unmanageable administrative mess."

The new man at the helm was Stephen Snoddy who began by looking for those controversial artists contracts.

Snoddy recalls what happened next, "I had no evidence of any contracts in place... as far as I could see, there was no, what I would call, defining contract between BALTIC and the artist that they were commissioning.

Hellgate Bridge - damaged during its BALTIC stay

"In terms of dealers... they had no financial risk, they get a terrific work of art they're able to sell on the open market, and make a lot of money from having no production input at all... they thought 'great', we'll say nothing, take the financial benefits from work that's sold. If I'd been in their position, I'd be particularly happy!"

As part of his exhibition Chris Burden brought over a number of his other bridges including the Hellgate bridge which was damaged at the BALTIC. The cost of repairing it was $20,000.

The owner was tennis player and sports pundit John McEnroe.

Stephen Snoddy remembers the ensuing problem, "When I read the letter from McEnroe's attorney, I thought that was a problem I could easily deal. You just don't tackle John McEnroe... It's a 'no-brainer'. I just thought pay the money... that decision was made within three seconds".

Uninviting and underused?

Two years after the BALTIC opened, its own management wrote the following statement:

"The building still has many problems... uninviting, cold, hard and suffers from poor presentation to the public."

It also said that parts of the building are under-used. Visitor numbers have also plummeting - a third down on when this was written and on today's evidence not getting any better.

Arts commentator Alan Sykes concurs, "I turned up once and four of the five floors were shut between exhibitions and the 5th was showing some catatonically tedious photographs by some obscure Icelandic photographer. There should always be something there for people to see - it's such a fantastic building - it deserves to have good stuff inside it".

BALTIC on its opening day - high hopes for the future

The memo reserves some of its most damning criticism for the Baltic's three restaurants.

It says that feedback has not been good - the public and senior business executives claim that the restaurants are full, but when you get there, they are always half empty

They say that the service is poor, and the memo claims that the recent refurbishment of the brasserie is a missed opportunity - it still lacks soul.

Milburns who look after the catering at the riverside restaurant and caf茅 bar told us they accept there have been issues at the BALTIC - but they are taking a fresh look at what's on offer:

"We accept there have been issues at the BALTIC, but we are already taking a fresh look at what's on offer. As a team we are working on some fantastic ideas that will allow local businesses and residents to enjoy and make better use of this attractive space."

And it's not just the restaurants that the memo slates - it also criticises the book shop and its "abysmal level of spend".

Critically it says that the exhibitions are too challenging. However,
established audience pleasers, such as Van Gogh, could have been investigated according to former board member Andrea Rose, but the opportunity was turned down.

So what has the then Chairman to say about the suggestion of bringing Van Gogh to the North East?

Alan Smith answers back, "This notion of Van Gogh was never raised by Andrea in the board meeting. She mentioned on one occasion... maybe a Picasso exhibition... but never a Van Gogh. To say Van Gogh could have come is absolute nonsense".

What is the BALTIC for?

Three years after opening the debate is still raging about what the BALTIC is actually for.

And what about providing a platform for local artists?.

North East Bill Varley says, "I was actually full of optimism, the gallery itself turned out to be beautiful... I would have hoped that we would have got lots of marvellous exhibitions of modern classics - you know, the kind that people pay to go and see in London like Edward Hopper, or Matisse, and people would be excited by them, their spirits would have been refreshed.

"But instead what we've got is 'challenging art' of the "two feathers and a bus ticket installation" type, and lots of flickering videos, very much an agenda imposed upon the people of the region."

Challenging art and challenging finances

Inside Out thought that we should return to the man who was the first Director of the BALTIC - Sune Nordgren.

We travelled to Sweden to ask him about the BALTIC and the contracts issue.

Sune explains that it was "a gentleman's agreement":

"There were contracts with Chris Burden... I'm absolutely sure there are contracts because I know I've signed artists' contracts."

"But if they can't find it, it's unfortunate...

"I'm surprised it says 'no contracts'- we didn't have a contract for everything but we did sign contracts for both exhibitions and commissions."

Inside Out asked Sune if he would do things differently if he was starting out again:

"No... I think there are things that we made for the BALTIC - this adventurous commissioning we did and expensive exhibitions.

"They made something very important for BALTIC, to place it as a very interesting venue for contemporary art in the world. Of course there are costs. I wouldn't do it another way. I don't think there is another way."

Sune has recently been having a bit of turbulent time in Norway with stories of overspending in the local press. We asked the former Culture Minister of Norway, Lars Roar Langslet, about his view of Nordgren:

"I have a great problem with the results of his activities, because he has converted our national gallery, which was a historical institution, into an art hall and that means that 70% of the national treasures are stowed away and made invisible. So I think this is a disaster to Norwegian cultural life, the worst disaster I have experienced in my lifetime."

This weekend there have been calls for Sune's resignation in the Norwegian press.

The future

But what about the future for the BALTIC? One of the biggest problems on the horizon will be cash.

Having squandered chances to claw back cash from commissions and commercial tie ups, a financial black cloud is looming over the art factory.

What future for the BALTIC? The gallery needs to generate cash

Its lottery money is running out - and even with a Government hand out of around 拢2 million a year, it is facing a shortfall of 拢700,000 in three years time.

Stephen Snoddy agrees,"BALTIC needs to earn as much money as possible from different sources... It needs to broaden and increase its income.

"BALTIC has to be run more efficiently... BALTIC can survive, but it's a big, big task ahead".

Inside Out did ask for a current member of the Baltic's management team to explain their plans for the future - but they declined.

However they did tell us that so far they've only managed to claw back the production costs on the sale of one piece of art - 拢7,000 from a Dutch film maker.