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Arts Council England (ACE) is having its budget cut by almost 30% in the government's Spending Review.

The Arts Council - which distributes money to hundreds of arts venues, theatre groups and galleries - said the cut would have "a significant impact on the cultural life of the country".

The 29.6% cut will see ACE's current government grant of £449m drop to £349m by 2014.

National museums will take a cut of 15% and will remain free to enter.

The Arts Council is also being asked to make a 50% cut in its administrative costs.

In addition, funding will end for Creative Partnerships (a school arts programme) and funding will be cut for the British Film Institute by 15%.

Alan Davey, ACE's chief executive, said: "This cut will inevitably have a significant impact on the cultural life of the country.

"The Secretary of State has asked us to try to ensure that funding for arts organisations is not cut by more than 15% over the next four years - the tipping point that we identified to the Chancellor some months ago."

He said the Arts Council would now meet to consider the overall position on 25 October.

"We will now be analysing the details of the settlement and the consequences for the arts in this country as a whole," Mr Davey said.

The ´óÏó´«Ã½'s Arts Editor Will Gompertz describes Arts Council England as "a big loser" in the Department for Culture, Media and Sport (DCMS) cuts.

He said: "They have to fulfil two specific requirements - to reduce administrative costs by 50% and only pass on 15% cuts to their regularly funded organisations.

"This is likely to mean the closure of some regional arts offices and a significant reduction in the Arts Council projects fund which enables them to support major events such as the Manchester International Festival."

Michael Boyd, artistic director at the Royal Shakespeare Company, said: "This will be a big blow to theatres - especially those who will also be losing local authority funding - and audiences will be the poorer. We are concerned that the settlement for the Arts Council doesn't allow it sufficient room to manoeuvre."

Culture Minister Ed Vaizey told the ´óÏó´«Ã½: "I think that the Arts Council will still be an effective organisation. It will have to be a leaner organisation and I think it will be difficult, but I'm very confident that the chief executive Alan Davey is capable of delivering those savings."

Meanwhile, the big museums have welcomed the fact that their cuts have been set at 15%, and that they will now have access to half of their historic reserves of cash, which between them amounts to £143m.

'Equally challenging'

In his Spending Review speech in the Commons, Chancellor George Osborne said overall DCMS spending would be reduced by 24% to £1.1bn by 2014/15.

Mr Osborne said that 19 quangos - including the UK Film Council - would be abolished or reformed.

"All of this is being done so we can limit four year reductions to 15% in core programmes like our national museums, the frontline funding provided to our arts and Sport England's Whole Sport plans," the Chancellor said.

"We will complete the new world-class building extensions for the Tate Gallery and British Museum in London."

He added: "I can also announce today that in order that our nation's culture and heritage remains available to all, we will continue to fund free entry to museums and galleries."

Dr Michael Dixon, chairman of the National Museum Directors' Conference (NMDC), and director of the Natural History Museum, said that although funding cuts were not as high as in other areas, they would be "equally challenging due to the high unavoidable costs of running museums".

He added: "In the current circumstances we may have to reduce some of the things that we currently offer, but we will preserve free access and as much of our service to the public as possible."

The National Gallery's director, Nicholas Penny, said: "The DCMS has ensured the unique contribution that museums make has been reflected in the settlement.

"We also welcome the announcement regarding access to museum reserves. We will now establish how the National Gallery will operate with the new allocation from the start of the next financial year."

A significant amount of arts funding in the UK - around £900m - comes via the Department for Culture, Media and Sport.

The DCMS directly funds some of the bigger museums and galleries - such as Tate and The British Museum - with other money distributed by organisations such as Arts Council England.

In Scotland, Wales and Northern Ireland the devolved governments decide how much is spent on the arts.

Shadow Culture, Media and Sport Secretary Ivan Lewis described the scale of the cuts as "unfair".

He said: "With this level of cuts, and the pressure on local authority budgets, museums, galleries and community projects across the country will fear for their future."