Education, Culture and Sport Committee, 15 Jan 2002

Meeting date: Tuesday, January 15, 2002

Official Report 245KB pdf

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Scottish Ballet Inquiry

Item 3 on our agenda is to take evidence in connection with the report on our inquiry into Scottish Ballet. This afternoon we will hear from a series of witnesses. We will take evidence first from Duncan McGhie, the chairman of Scottish Ballet. After making a statement, he will answer questions from committee members.

On behalf of the board and senior management team of Scottish Ballet, I thank the committee for giving me the opportunity to meet it again. The year 2001 was an eventful one for Scottish Ballet, culminating in our highly successful production of "The Snowman", which played and is continuing to play to record audiences. My board has always recognised that productions such as "The Snowman" must have a place in Scottish Ballet's repertoire if we are to present an overall programme of productions that appeals to the ever increasing and diverse audience that we seek to serve. Increasing and broadening our audience are objectives to which the board is absolutely committed.

We received the committee's report in early December and responded to it in writing shortly afterwards. Those documents are a matter of public record. However, as we move into the new year, we must concentrate our thinking and energy on the future. There is much to be done and there are many hurdles to be overcome, but we in Scottish Ballet are excited about our future prospects. I hope that the committee shares that excitement.

We are now well into the process of finding our next artistic director, and some exciting names are beginning to emerge. We have presented an ambitious plan for the next few years to the Scottish Arts Council. The plan sets out to build on the fine traditions of the company's past and present, but also addresses the key issue of lack of investment, which has been the reality of recent years. The plan aims to develop the company to even higher levels of performance than have been achieved to date. Whatever the sceptics may wish the public at large to believe, members should be assured on one important point: my board is committed to developing the company into something bigger and, I would say, even better than what we have at present. Nowhere on our agenda are there plans for contraction in scale, quality or excellence.

The people of Scotland want a successful national ballet company and we remain committed to meeting that requirement. However, my board recognises that, if we are to develop successfully, we have to learn the lessons of the past. We have to be flexible and amenable to change where change is demonstrated to be in the best interests of Scottish Ballet.

The public record shows that we had considerable difficulty with many aspects of the committee's report. I believe that, rather than debating the many points of detail that could arise from the committee's report and our response, it would be more productive to move forward positively by examining a number of the important issues that the Education, Culture and Sport Committee raised quite properly for our consideration.

Much has been said about consultation, which is an issue that also involves the question of effective communication. In view of the strength of feeling that was evident in the committee's report, my board has reviewed carefully the events of the past few months. There is no doubt in my mind that important lessons have been learned. It is a poor organisation that cannot learn from the past and an even poorer organisation that does not seek to implement change for the good of the organisation as a whole.

I wish to reassure the committee that we have learned lessons and that, as a result, we are trying to improve our processes. It is not always easy to implement change, particularly in the context of a company that continues to face so much uncertainty and anxiety about the way forward. However, the committee should be assured that we are determined to implement any change that we believe is for the long-term good of Scottish Ballet. Could or should more be done? Possibly, but that is a question to which we can return during the question time.

Another important issue is the one of governance. I will give a brief definition of the term. Governance covers all the issues of an organisation's direction, management and interfaces, both internal and external. It deals with issues of representation at all levels of the organisation. It also deals with how policy should be created, discussed and approved. It has to cover all aspects of the direction and management of the organisation. It cannot look only at one side of the equation.

In the present debate, it is not simply a question of having a different group of directors on the boards of the two companies that are involved. For both companies and all the employees, the implications of the proposals for change have to be considered before change can be implemented safely. The committee raised that issue but, according to its report, members have looked only at one aspect of the overall governance issue, namely, the issue of separate boards of directors.

The key question facing us today is whether a sufficiently better alternative model would justify the consequent upheaval and disruption that would result from change. I do not know whether there is such a model but, on behalf of the board, I repeat my commitment to participate enthusiastically and fully in an expert review that would cover all aspects of the governance question to see if improvements could be made.

I could go on to discuss the many important issues that face Scottish Ballet and which your committee may wish to address, but time is short. What my board wishes for Scottish Ballet is that it continues to flourish and to be a key contributor to Scotland's cultural heritage. One of the necessary ingredients to make that happen is that the public focuses on the excitement of our art form and not on the necessary, but comparatively dull, aspects of corporate direction and management. The Education, Culture and Sport Committee has a key role in helping to change the focus of the present debate. A periodic, independent but professional review of our affairs is another of the important ingredients that are necessary to ensure that companies such as Scottish Ballet succeed.

Convener, your committee has a key role to play in such reviews. I therefore welcome this debate and the opportunity to meet you again today. I would be pleased to answer any questions.

In opening up the meeting to questions from members, I will begin with a question on consultation, about which the committee feels strongly. Consultation was our focus, the reason for much of our work. It is clear to the committee that the required consultation did not take place.

In your opening statement you said that you are looking to improve the consultation process. One of the committee's main concerns was that the key stakeholders in ballet did not feel involved in that process. What steps are the board proposing to take on consultation to enable the participation of key stakeholders such as the dancers, other ballet staff and the Friends of Scottish Ballet? Those who are in dance training make up a further group that was missed out but that was a large feature of the submissions that the committee received. They spend a lot of time and effort training to enter the dance community in Scotland, of which Scottish Ballet is an important part. How does the board propose to involve those groups in consultation?

Since the August meeting, board colleagues and I have met with the dancers on a number of occasions. We made a firm commitment to meet them regularly to discuss the plans. I must say that those meetings have not been the easiest, as they have tended to deal with short-term issues. So far, there has not been a great deal of opportunity to talk about longer-term plans. However, that forum will continue. It is a new part of our processes and was instigated as a direct result of the review.

We are also examining the management team arrangements. Scottish Ballet has had a traditional approach to the management of the company. It may help if I give the committee a bit of history. In days gone by, the management team attended the board meetings but, for what I believe are good reasons, that has not happened during my tenure as chairman. In any review of the governance arrangements, we could reconsider that approach and look at representation at board meetings. It is important that we look at the nature of the internal management meetings and clearly resolve the interface between different members of the team. I believe that the situation is clear, but I am not sure whether the company fully understands it. We must communicate—that is why I referred to communication. As we move into a new regime at Scottish Ballet, there is an ideal opportunity to look at the organisation and at representation at each level. I am convinced that we have started the process, but much more can be done.

You mentioned representation at each level. Another issue that came out in our report was that of employee involvement in the board. Have you considered that issue? Should progress be made on it through discussion with the trade unions that are involved and perhaps the Scottish Trades Union Congress, which could be a vehicle for developing that form of involvement? I know that most, if not all, employees and trade unionists feel quite strongly about such issues. Such discussions would be a positive step in the right direction.

Let me be clear. When I became chairman, I arrived with a view that was based on my experience, in a different context, of sitting on a board on which employees were represented. My view was that clear pluses and minuses were associated with that approach but, in the early days, I did not think that it was appropriate. However, I am quite happy to change my mind and would welcome a discussion on how, and in what form, employee representation could take place.

When we gave evidence before, I observed that the trade unions were completely unanimous on the subject. I am happy to support the point that you make and to look at the issue constructively with the Scottish Arts Council. If the committee or the SAC felt it appropriate to do so, I would also be agreeable to involving the STUC. I would be happy to co-operate with such a review.

That is a positive step in the right direction.

I will pursue you on the issue of consultation. Recommendation 118 of the committee's report says:

"The flawed process alone indicates that decisions should not be finalised until there has been a period of genuine consultation and debate and the Arts Council should insist upon such a period."

I want to be absolutely clear. You talked in general terms about reviewing consultation procedures and possibilities for the future. Does the board intend to undertake

"a period of genuine consultation and debate"

about its proposals before the final decisions are made?

I am sure that the committee accepts that, at the end of the day, it is the responsibility of the board of directors to take decisions. It is not appropriate for us to put on hold a process that is moving forward satisfactorily. I apologised to the committee when I gave evidence previously for not making it clear that, in terms of the artistic form of the company, the announcement in the middle of August 2001 was the beginning of a process.

Our extensive consultation with the dance community and the key stakeholders is a matter of factual record and it demonstrates our commitment to beginning to discuss and broaden the way forward. I made it clear that we will not finalise the artistic plans until our new artistic director is on board and, even then, it will take time. Mr Russell and the committee should be assured that, as a result of the extensive consultation of recent months, we have developed, modified and improved our plans, which is for the good.

Is that a no to paragraph 118? Are you saying that there will not be

"a period of genuine consultation and debate"

until the decisions are finalised?

To which decisions are you referring?

The decisions to which you referred. You are bringing in a new artistic director and, according to you, you are changing the nature of the company.

As I have just said, we are considering how to broaden the nature of the company. We listen to the advice that we receive. That has taken us beyond the position that we were in on 15 August, which is for the good of Scottish Ballet.

I do not want to fall out with you this early in the proceedings—I am sure that we will do that later—but, with the greatest respect, what do you understand by consultation? During its inquiry, the committee received a couple of hundred submissions that were opposed, some in vitriolic terms, to your statement in August and the subsequent events. The dancers continue to indicate vociferously that they are not in favour of the changes in the company and they say that you and the board have lost their confidence. Friends of Scottish Ballet, of which you are no longer the chair, takes exactly the same position. Members have a submission from seven of the 12 members of the executive management team—

The management team has 14 members.

According to the document, there are 12.

Then it is inaccurate.

Seven of the members say that they disagree profoundly with many of the things that are happening. They ask you not to make the appointment until there has been further consultation. What do you understand by consultation? Almost everyone is against you, except your board and the gentlemen from the Scottish Arts Council who are arrayed behind you. That seems to be enough to make you go ahead. What is consultation?

Consultation is about listening, learning and deciding. When one takes a decision, one progresses. I suspect that even if we argue for days or weeks on end, you and I will not agree about the degree of consultation that took place with our artistic director and many others in the first 18 months of my board's existence. You appear to have ignored the extent of the consultation in that period. In January, February and March of last year, a decision had to be taken. I believe that my board took the right decision. We are moving on from it. The decision was about an appointment. I am not prepared—I never have been—to discuss publicly the details, which involve an individual, but we believe and are satisfied that it was the correct decision at that time.

A framework document about the nature of the company was produced. That document will be the subject of the next extensive consultation period, which will continue not only for months but for a year or two. I refute the assertion that we did not consult before deciding on artistic direction. We have a major consultation programme that involves us in listening and learning and in taking on board and developing suggestions that are in the best interests of Scottish Ballet.

Mr Russell has a final question.

I think that the Official Report will record the interesting admission that the issue is mostly about the fallout between the artistic director and the board.

I want to pursue the point about consultation—

I am sorry, but I take issue with that.

Mr McGhie may clarify the position.

The board decided that we would move on after Mr North's three-year contract ended. It is perfectly possible to do that. I have never made, and never will make, a statement that there was a fallout. There was certainly no fallout on the board's behalf.

Convener, I must ask another question.

I do not think that we should go down that road.

I think that it is relevant to do so, because the witness said that the decision about an appointment was taken in January or February and the announcement was made in August. There appears to be a discrepancy between that evidence and earlier evidence.

No. Absolutely not.

We can look at the Official Report for clarification.

I ask Mr McGhie again, because it is important, about the reality of the consultation process. I have no doubt that you have the right to run the company, with your board, for as long as you are in office. However, when the vast majority of people who give evidence to an inquiry, the vast majority of your employees and the vast majority—as we can see—of your audience disagree with what the board is doing, do you ever think that you might be wrong?

I always question whether we are right. That is part of a continuing process, as I said in my written submission for today's committee meeting. It is a poor organisation that does not listen and learn from the lessons of the past. However, the board took a decision last May. I gave evidence about why the announcement of that decision was delayed until August; there were perfectly valid reasons for the delay. We took that decision and we are moving on from there. It would be a weak and poor board if we constantly changed our minds.

It might be a listening board.

I will take a slightly different approach from Mike Russell's, but stay with the issue of consultation.

If one accepts your position that consultation took place in Scottish Ballet between the board and members of the management team, what weight will the board give to the next stage of consultation—which, it is clear, has started—of the public and those within the company who did not participate in the previous consultation?

I speak not for the committee, but as a member when I say that what is important—but does not seem to be emerging—is that any genuine consultation must give weight to the responses. Not all of the responses to the previous consultation were vitriolic; many were positive. If weight had been given to those responses, one would expect to see change. However, the only change that I have seen so far is an admission that the board's phrasing of its plan to take a new approach to the company's dance style might not have communicated its true wishes.

In the light of public reaction from, for example, the Friends of Scottish Ballet, Scottish Ballet staff and dancers, will the board consider other changes? The majority reaction is that Robert North should stay. Is it the case that that area is non-negotiable, but that you are willing to consider other aspects of the consultation?

If it will help the committee, I will make a clear statement. My board took a decision that Robert North's contract would not be renewed at the end of its present term. We are in the process of recruiting the next artistic director. It is not my intention to change that decision, unless I am instructed to do so by the minister or the Scottish Arts Council.

We could not have a clearer statement of the position. We would have to take up that matter with the Scottish Arts Council and the minister, if they required you to change your decision.

Consultation, which the previous questioner asked about, was a concern in our report. Given that you are moving into the arena of appointing the new artistic director and that there has been disengagement from the board by sections of the staff, how will you overcome the hostility to the board that has been obvious in the evidence that has been submitted to the committee by staff, particularly dancers?

We understand the worry and anxiety that is felt. At stake are people's jobs, careers and lives. The committee has never suggested that the board was not aware of the importance of this issue. The whole debate is about people's jobs, careers, lives and futures. We are very concerned about those, particularly given that press headlines tend to concentrate on the negative, rather than the positive.

We want to ensure that, when we move to appoint the next artistic director, each of the short-listed candidates—do not hold me to this, convener, but I hope that there will be three or four of those—will meet the company, the management and the dancers and conduct a class with the dancers. That will happen before the final interview process. The interview group will receive comments back from the management of the company and from the dancers, to which due weight will be given. People will be excited if the next artistic director appointed is the right one. They will be intrigued by the challenge that he or she poses. We will listen to the views of the dancers, in particular, on the candidates and take on board those views before reaching a final decision. That is an extremely positive step, with important implications for the way forward.

Involving other bodies is more difficult, as we are dealing here with people's lives. A recruitment process of this sort cannot take place entirely in public, although that does not mean that it should be secretive. As part of the consultation process that has taken place in recent months, I have spoken to the Friends of Scottish Ballet. The organisation has 950 members, but no more than 50 attended any of its meetings. Those 50 people expressed probably 20 or 30 different views on what was the right art form for Scottish Ballet. It is difficult to get the right mix and marriage. However, involving people in a recruitment process that is aimed at ensuring that we secure the right appointment and an exciting artistic director is the way forward for the company.

I am sure that artistic loyalty to a director is an issue for dancers.

Absolutely. Such loyalty is commendable.

The same is true in other areas of sport and culture.

Stability and the number of people who are employed by the company are always an issue. Underpinning much of the evidence that we have received is a sense of insecurity, which has been caused by difficulties over the past few months as well as over the past few years. I am conscious of what you said about change and the role of the artistic director. Are you in any position to say how many people the company will employ in future? Concerns have been expressed to us about whether the process in which you are engaged will reduce drastically the number of dancers who are employed by Scottish Ballet. Can you enlighten me on that?

You catch us at an important point in the overall process. Some weeks ago, we submitted to the Scottish Arts Council plans for the next two or three years of Scottish Ballet. The committee has discussed with us before how we can do that without an artistic director. As I am sure the chairman of the Scottish Arts Council will explain, our work over the coming months is very much tied in with the comprehensive spending review. Scottish Ballet is making a bid for its fair share of the money that will be made available as a result of that review. As I said in my opening statement, that involves our bidding for increased funding—I make no apologies for that—to make good the lack of investment in the mid to late 1990s. The bid is aimed at enabling us to maintain the number of fully qualified dancers in the company at its present level and, in year three, to increase it—not significantly, but by a perceptible figure.

That is what I meant by my opening remarks. We have no plans whatever to contract the company; we fully plan to grow it. That will, inevitably, be subject to finance, for which we are looking to other sources as well as Government. We are at a delicate point in discussions on other sources of finance at this very moment. That is part of the reason for my request to everyone that we take the matter out of the headlines and that we are given the chance to manage the company.

That was one of the areas that I was going to mention. Clearly, there have been negative headlines and problems with sponsorship. One of the weak points in your financial position in the past 18 months or so has been the underachievement of sponsorship targets. How can we make progress with sponsorship? Do you acknowledge that "The Snowman" has been a great success, both artistically and with the public? Productions of that sort might help you to gain more sponsorship.

There is no doubt that "The Snowman" has been a great success, which is terrific. As planned, this evening I am going to see the opening night in Aberdeen, which is a sell-out. That is great news. The production is an example of how we have been developing our thinking about the way forward. A Christmas family bash—if I may use a totally non-technical term—is important. I do not mean that to sound condescending. I was delighted that so many members of the committee, including Mr Russell and Mr Monteith, were present to see for themselves such an excellent performance.

The difficulty, as Mr Jenkins rightly said, is well illustrated by this headline from the Sunday Herald on 16 December:

"Main sponsor of Scottish Ballet threatens to pull funding; Bank worried over publicity ‘for the wrong reasons'".

In the article, a member of the committee said that the solution was for the ballet's board to review itself. The committee member also said:

"We need a fresh start."

Such headlines do not help. The text of what the Bank of Scotland said is completely different from that headline. We are in regular touch with our main sponsors—not just the Bank of Scotland, but many others. All our sponsors are asking for stability, for something exciting, for quality, excellence and development, and saying that they will be there with us. That is the message that we have got from our sponsors.

Will you expand on that point a little? You concede that productions such as "The Snowman" have been successful. You said at the start of your evidence that such productions would always have a place in Scottish Ballet's repertoire. Given that "The Snowman" is bringing in a positive financial return—it is a sell-out—and has been popular with audiences, what other kind of productions would you want to stage? How could you improve on a 100 per cent capacity audience? How could any of your planned improvements begin to improve on that?

"The Snowman" is a specific type of production. It is very much a performance for children. It was wonderful to watch the reactions of the children and the doting parents and grandparents who were with them. That is exciting. However, I could not imagine a season full of snowmen. I believe that what you are getting at is the important point about the role of a national company. As a national company, we have to appeal to an ever widening cross-section of audiences here in Scotland and when we take the company outside Scotland.

It is my firm belief that we need to put on a balanced programme that includes productions such as "The Snowman". We could not put on such productions too often, but they are appropriate.

We have to acknowledge the trend and movement in the feeling about dance in Scotland, which is undoubtedly broadening from where it was 10 or 20 years ago. As a national company, it is our role to respond to that. We will, therefore, be looking at a broad range of productions that will meet the rightful expectations of the Scottish public.

I return to the recruitment process for the new artistic director. Although I acknowledge and respect the confidentiality of that process, I ask you to confirm whether all those who are applying have a classical ballet background. Was that an important consideration?

I have not seen the list of applicants, and that is a matter for the selection board. I know for a fact that there have been a significantly large number of applications, but I have no details on them.

But you were able to say that the applicants were at the forefront of dance and that the prospect was exciting. How do you know that if you have not seen the list or do not know anything about who has applied?

Because those are the criteria that we set and we are looking for people who can meet them. Different types of artistic director are coming from different backgrounds and have different experience, and that is what we are looking for. Some are young and exciting; some have more experience; others come from different countries. At this stage in the process, we have been delighted that so many people have expressed an interest in coming to Scottish Ballet. That is what is exciting. Over the weeks and months ahead, we will be refining the list to find the right person for Scottish Ballet.

Is classical training one of your criteria?

We have always said that Scottish Ballet will be based on classical training. That will not change.

In your opening remarks, you drew attention to a couple of key issues that the committee raised regarding the future of Scottish Ballet. I thought that you were going to give us a long list of key issues, but you mentioned only two: consultation and governance. You are not going to do what the committee asked and have a proper period of consultation; and, as for governance, you believe that it is time for an expert review instead of taking on board the committee's recommendation. You have also complained about the lack of stability and the fact that there have been too many headlines.

Is not it time to end all this? You have received almost unanimous opposition from members of your own company. For example, in the document that we have been given today, prominent members of your executive management team say that they do not agree with what the board is doing and agree with the committee instead. Would not it be best to find some way out of this situation? If so, surely the best way of doing that would be to say, "Yes, we got it completely wrong from August onwards; we think that it is time for a new future; let's have a good period of consultation." Would not that strengthen your board's position by showing that you have been listening not just to the committee but to everyone who has been commenting in the past six months? Those comments have not been listened to at all. I encourage you to do what I have suggested today so that we can move forward on this issue.

I am at a loss to know how to answer. Mr Russell's point is based on bits of information and does not present the whole picture. For example, it does not refer to the evidence that the committee received that supported what the board was doing, nor does it mention the support that we have received from the Scottish Arts Council and the minister, who is ultimately responsible. Furthermore, it does not pick up on the fact that we have carried out—and are still carrying out—consultation. Of course we are listening.

I repeat the point, Mr Russell. If the committee's wish is for the board to change its mind about the artistic director, I am sorry—that item is not on our agenda.

I withdraw that issue entirely—that is a decision for the board. The committee has made it absolutely clear that its criticism in that respect—and it is important that you understand that we have taken no stance on the matter—was that you had dealt with the issue in a cack-handed way. The issue is not Robert North, but the fact that your staff, your senior staff, your audience, the Friends of Scottish Ballet—whom you have tried to dismiss again today—and a whole range of other people are against you, your board, the SAC and the minister. The last two will have to speak for themselves later.

Things should never have reached this point. However, you can get out of this situation today by publicly offering a genuine period of consultation, which we have asked the SAC to insist on as we feel it would be the best way forward. If you committed yourself to that today, we could move forward.

I have committed us to a period of consultation; indeed, we are already in it. I have already given the convener an absolute commitment to examine the consultation process with the SAC and the STUC to find out whether it can be improved. However, if we stop the process of bidding for more finance and finding an artistic director, the company will die.

No, it will not.

I believe that it will. The financial position is quite clear: if we do not have an artistic director, the company will not survive. The appointment of that artistic director is dependent on the candidates' perception of the state of the company. The state of the company is that we are in consultation and moving forward positively. We want to grow the company and invest in it. That is what we are telling the candidates and that is the positive message that should go forward.

Mike Russell may ask a final question.

There is a simple way in which you could move forward. You could extend the existing contract for three months, which would allow you to have a three-month period of consultation. At the beginning of that period, you could say that there is no prospect of your extending the contract further. You could move an inch to try to answer the objections that have been put to you. Otherwise, this will appear to have been a dialogue of the deaf, in which there has been no progress since the report was published in August and in which you have had the backing of the Scottish Arts Council and the minister but of nobody else. The epitaph for Scottish Ballet will be that the board was, frankly, too stubborn to find a way out of this difficulty.

I take it, convener, that a member of the committee is proposing that we change the contractual terms of our present artistic director. Is that what I am hearing?

I understand that that is what Michael Russell is proposing.

I do not think that that is a matter for the committee.

The proposal did not come from the committee; it came from Mr Russell.

The witness has given a very inadequate answer—very inadequate indeed. Can I observe that?

You can observe that, Mr Russell.

I hoped that we would be able to move forward today. I felt that Mr McGhie's opening remarks were positive in several regards, and we have heard some commitments to change. However, I do not want to roll over and say that everything in the garden is wonderful, because some of the committee's points need to be addressed. I would like to feel that we could accept the idea of reviews. I am pleased that we have not started bickering about the details of the report. That would have been negative. I know that some parts of the report have upset you hugely, although we feel that we are totally justified in all that we said.

I worry—as you do—about the future of the company. If you seriously believe that the way in which things are going is the best way forward, we will probably have to leave matters up to the board and see what happens. Michael Russell obviously feels that that would be dangerous territory for the company. For the reasons that I mentioned earlier—finance and so on—I feel that the company is under some threat anyway and that the whole matter needs to be sorted out. How can the company move forward financially from here?

I am grateful for those comments, Mr Jenkins. I tried to open this debate positively, because I feared greatly that it would degenerate into a line-by-line discussion of the committee's report, which would have done no one any good. The committee's report and our response are a matter of public record, so let us move on positively.

Mr Russell said that I raised only two points, regarding consultation and governance, and that we have not really talked about governance. If there were other points of substance that the committee felt that we should address, I would welcome discussion on any of those. The company has been starved of investment and has come through better times in recent years, under Robert North's direction—I pay tribute to that. However, it is now time for the company to move on to the next stage in its illustrious history. That is what the board is trying to achieve.

I remind the committee that I chair the fifth board of Scottish Ballet since 1996. That is a reflection of the instability that the company has suffered over the past half a decade and more. Stability is hugely important and is what will unlock the coffers not only, I hope, of the Scottish Arts Council—Mr Boyle is listening in the public gallery—but of private sector donors. Many initiatives, apart from the idea of our creating a development board focused specifically on Scottish Ballet to tap into high-wealth individuals, are under way to achieve that and to help the company, and we want to get on with those.

Let us leave aside the personal circumstances of Robert North and address the issue of the role of the artistic director.

If the current consultation process reveals that the sponsors and the customers—the people who attend and support your ballet, such as the Friends of Scottish Ballet—acknowledge that there will be a new artistic director, but want stability and want the company's format to stay broadly the same, will you accept that view? Alternatively, if a potential new artistic director came along and put a valid case for changing the nature of Scottish Ballet, would you go with that? Would you opt for the strategy of a new artistic director who would change things or would you listen to the outcome of consultation if it said, "Okay, we haven't got Robert North, but we want something similar to what he put on in the past"?

When I gave evidence previously, I think that it was Mr McAveety who had some difficulty in understanding what was meant by terms such as "contemporary", "modern" and "classical". Frankly, I think that it is still the case that if we line up six people, we get seven different definitions of those terms. We believe not just in recognising what past and present audiences in Scotland have been and are looking for, but in considering what audiences will be looking for in the years ahead. That is a proper role for a national company. It is clear that, compared with 10 years ago, there has been a significant switch in the overall presentation of dance in Scotland. If we were to stick in the past, we would not fulfil the role that the committee rightly expects us to perform.

I have listened attentively to the Friends of Scottish Ballet, which you mentioned. I repeat that I have not heard from more than a proportion of its members—the Friends of Scottish Ballet has nearly 1,000 members and I have never seen any evidence of what its full membership believes. Those to whom I have listened have very polarised views. One member of the council of the Friends of Scottish Ballet is diametrically opposed to the present artistic direction, and I have heard her say that in public. We listen to such views. Another lady said, "Frankly, all I want Scottish Ballet to do is large, white, in tutus and nothing else."

The numbers sound large, but 200—or whatever the number of representations is—is small compared with the population of Scotland that we seek to serve. Where are the representations from the schoolchildren with whom we work? Where are the representations from the local authorities for whom we work? I could go on.

In the end, we have to move with the times. We are not into radical, quick, quantum leaps away from a secure base. I hope that, by talking about the example of "The Snowman", I have given members some reassurance in that regard. The key role of a national company is to develop as part of the overall dance strategy for Scotland, which is an exciting document that the Scottish Arts Council has most helpfully—and for the first time—produced. If we were to stick to the traditional approaches of the past, frankly, we would not be doing our job.

I understand those answers, particularly on the interpretation of what might be contemporary or modern in dance or ballet. I am thinking in particular about how one gets an idea of what audience reactions will be. If your audience figures started to plummet following a change, that would naturally be of great concern to everyone, including you and the board.

Absolutely.

How will you manage a change in artistic director and present that change in such a way as to reassure people, if most of them say that they do not want too much change?

As we have said consistently, the key to that is to find the right exciting person. If we find that person, people will sit up and say, "Wow!" They will think that Scotland is on the national and international dance map because it has been able to attract X or Y to lead its national company. That is the thing that will excite people.

I welcome Mr McGhie's comments, because we all share an interest in the future of Scottish Ballet. I welcome what he said about being forward looking and learning the lessons of the past. I am at a slight disadvantage to some of my colleagues on the committee, as I did not participate in the detailed work of compiling the report. The advantage of that may be that I have a helicopter view of what has happened.

Mr McGhie, you highlighted two main issues: consultation and governance. Consultation is quite a specialist area. In addition to what you have already promised, would you be prepared to seek external assistance in carrying out consultation? Consultation with your stakeholders has been light on the issues that you have raised latterly about how you engage with Scotland as a whole. Your prospective audience is all of Scotland, rather than the 1,000 or so members of the Friends of Scottish Ballet. That is critical. No matter how exciting an artistic director is, they alone will not be responsible for your audience figures. Getting a measure of what your audience thinks is important.

Having previously worked as a consultant for 15 years, I know the advantages and disadvantages of external consultancy. However, that is a side point.

My position is absolutely clear. We will work positively and actively with anyone who can help us to do things better. We are not proud. We do not have all the answers on this issue. If the committee has any specific suggestions, we would welcome them. Perhaps we could work with the Scottish Arts Council on taking consultation forward. Members have suggested that we work with the STUC; I would welcome that. If the involvement of an external individual would be helpful, I would not rule that out, although I would have to ensure that his or her credentials were relevant. However, my response to the point that Jackie Baillie makes is very positive.

That is helpful.

You suggested that the committee focused on governance only in relation to the board of directors. That is not my reading of the committee's report. Genuine concerns were expressed about financial and strategic planning, about the complexity of the process and about the lack of clarity in it. I will not enter the terrain of disputing figures with you, as that would not be helpful. However, in any large organisation, the planning process must be very clear. I wonder whether, having reflected on the overarching aims of the committee's recommendations, you have made any changes at board level to ensure that there is clarity of financial planning throughout the organisation.

Like the member, I do not want to rake over old ground. In support of my board, I would say that we have a degree of expertise in financial planning and strategy, which is extremely helpful to the company and its future. When I last gave evidence to the committee, I said that we were not clear enough about the process and that it became complicated. It was not always clear what plan we were talking about. The purpose of some of the early exercises was to test the water. We need to simplify the process wherever possible.

The committee should be aware that for the first time, to my knowledge, in the history of Scottish Ballet we are producing proper, full business plans that extend beyond one year. We have instigated that practice for the good of the company. In my business experience, simplification is the best way of making the planning process more transparent and more easily understood by all concerned.

Governance relates to many issues, not just to boards of directors. It is about the interface with the external world and the senior management team and about who should be represented where. This afternoon the committee has raised the matter of employee representation at all levels. I would be happy to talk about all those issues.

We are where we are today because of political decisions that were taken before my time. At issue is how we move forward positively and safely, not just with Scottish Ballet, but with the other companies for which I have responsibility. That is why I believe that governance arrangements need to be thought through more, to see whether there is a better model. If there is, we will go for it.

Earlier, you said that the minister might consider initiating some sort of independent review. There has been press speculation about that. If you were designing such a review, what scope would it have and who would you get to conduct it?

Any review should not be commissioned by us, because we would be the subject of it. I do not know whether this is a matter for the Scottish Arts Council or for the minister, but it is certainly not a matter for the board of the company concerned. We would be the participants in any review.

The review should be carried out by someone who understands corporate management and direction and the relationship between different parts of an organisation. That person should also have a sympathy with the arts world and understand the context in which the review is taking place. The review would not need to be particularly lengthy; it could be done relatively quickly. It would involve, dare I say it, consultation with all the appropriate bodies—trade unions, management, the Scottish Arts Council, Government and, perhaps, the committee. It should examine the current position, consider whether another model would be demonstrably better and seek to establish whether it would be possible to move quickly from one to t'other without too much pain. That is how I would go about such a review. I can think of people who could do the job, but I will refrain from naming names. It would not be for me to select the person who conducted the review.

I was more interested in the content.

Have I answered your question?

Not really. You talked about moving from where you are today to another model, as if that model were assumed. If the review were to be conducted by someone with a corporate management background who had a sympathy with the arts—which I, too, would support—they would want to examine closely the internal processes that currently operate.

Absolutely.

They would want to start with a clean sheet when recommending what should happen to the structure of Scottish Ballet. They would not want to become involved in issues of artistic direction.

I do not think that we are far apart.

Thank you for the evidence that you have given to the committee today.

Our second set of witnesses is from the Scottish Arts Council. They are the council's chairman, James Boyle, and its acting director, Graham Berry. Thank you for your time. Before we move to questions, would you like to make some introductory remarks?

We are content to move straight to questions.

I want to put to you the same question that I put to Mr McGhie. If there is to be a review, what should be the content of that review? How could it be carried out most productively? I am not asking who should conduct the review.

The Scottish Arts Council would be the appropriate body to carry out such a review. Timing is the next most important issue. Because the aim is to rebuild confidence, a review would best be carried out once greater stability had been attained.

We can take two views. Issues of stability, confidence and—dare I say it—trust might arise, with people uniting around the conclusions of an independent review. The alternative view is that we could wait until certain things have happened and then conduct the review. Given some of the evidence presented and the continuing disquiet, I tend to take the view that an independent review happening sooner rather than later would help to re-establish some of that stability, confidence and trust.

I would have to take issue with that. My experience is that people do not gather around bits of paper; they gather around leaders. We are in the process of finding a new artistic leader. That will introduce the degree of stability in which I am interested.

Is there a danger in appointing people to review the governance of Scottish Ballet and Scottish Opera, given that we are talking about joint governance of both companies and it should be considered whether that joint governance is working? Is there a danger that, if one employs consultants who have a corporate background and a keen interest in the arts, their views would be loaded towards the corporate aspect?

You mentioned leadership. Clearly, in an artistic company, artistic leadership is important. Many of the past troubles with national companies have been with the interface between the artistic director and the chief executive. Would you therefore accept that it might be possible for the consultant, or the person in charge of any such review, to be strongly associated with artistic success as well as having corporate experience? That is a slightly different way of looking at the issue. One might argue that that might load the review in favour of the artistic outlook, but I have to point out that we are talking about artistic companies. If leadership is important, the artistic direction has to be given due weight.

As Jackie Baillie said, the best way of looking at the issue would first be to define the remit of the review. What is it that we want the review to cover? The clear aim for any major artistic company is to achieve artistic excellence.

The first point in the remit would have to be how the governance could be organised so as to make artistic excellence possible and ease the way towards it. Once the remit was sorted out, the question would then be to determine who the best people were to achieve that. Nowadays, a reasonable number of people have the ability to consider issues across the board, not just corporate issues or artistic issues. A number of people are capable of marrying the two together and understanding that the two elements can operate jointly while allowing artistic achievement to be placed at the forefront.

Why has there been such difficulty and instability in Scottish Opera and Scottish Ballet over a period of time? Duncan McGhie rightly referred to the fact that there has been a revolving door for board members and others, including artistic directors. I remember that, when Robert North was appointed, the word was that he was the best thing since sliced bread. Why have those companies in particular had such a rocky time? Are the reasons to do with shortage of funding or are there other reasons?

I cannot answer that in a quick way. Like you, I have watched events as a Scottish citizen—I have the same qualification. There are all sorts of reasons. From your question, I infer that you think that there might be a lesson for the present situation, but I do not think that that is the case. In the present situation, we must keep in front of us the fact that the contract of the artistic director of Scottish Ballet is not to be renewed. Everything else flows from that key fact.

The Scottish Arts Council's interest is the proposition that, by changing the artistic director, we will improve the quality of the national company, which, to go a step further, will then be fit to take its place among those of other nations—under the Edinburgh International Festival criterion, it patently is not yet. I do not have any historical lessons to offer.

That is a helpful and positive statement, if that is the thesis. However, although it is possible to debate or discuss that thesis, the final decision lies with the board of Scottish Ballet.

Indeed it does.

Under those circumstances, having made the decision, the board can move on.

I agree.

On what has happened since August, the issue has not just been a chimera in the minds of committee members; there has been an enormous stushie about it. Do you accept that the events of August were very badly handled by the company and, I have to add—although this is not a personal criticism of you, Mr Boyle—by the Scottish Arts Council at the time, especially in relation to the announcement that was made?

Scottish Ballet's chairman has had the humility to say that lessons could be learned, and I think that that answers the point. It is not worth making that point, however, unless one goes back and says honestly and candidly that the field was open for the disaffected person—the outgoing artistic director—to advocate his position, which he continues to do, as I understand from the letter that you drew to our attention earlier. That exacerbated the position dramatically, because we reached a situation in which all sorts of misinformation was running around—that made things much worse than they needed to be.

I am interested in that point. The letter from Robert North, which has been distributed and is freely available—although I understand that some people would not accept copies of it before the meeting—could be interpreted, as could the position of the Friends of Scottish Ballet and the dancers, as part of a partisan battle between a former or departing artistic director and a board. However, it could be interpreted in a different way, as describing just an element of the situation, but one that was made considerably worse by intransigence, by a failure to consult and by poor processes within the organisation. If we were to take that line, we might say that the committee's report, which was not based on partisanship for one individual or another, was treated with scant respect—I suppose that that is the kindest way of putting it—by the organisation that it described.

I put this question to you, Mr Boyle, as I put it to Duncan McGhie: do you not think that we have locked ourselves into something from which we could unlock ourselves by going back to basics and accepting that the artistic director is leaving—I think that there is no doubt about that, although, because of the time scale of the appointments process, he might have to work a month or two more—by having a genuine consultation, by taking the present artistic director out of the equation and by sitting down with the stakeholders, the dancers, the audiences and others to examine the whole future of Scottish Ballet? Would that not put us in a much stronger position? It would give us something to move forward from.

In short, no, it would not. First, I understand that Robert North's contract runs until the end of August. That contract is current and is subject to negotiation, employment law and legal considerations. Let me put the other scenario to you, Mr Russell. Let us suppose that the whole thing stopped dead and that we halted the process of recruitment and dumped applicants of what I hope—although I genuinely do not know about this—is international stature in the wastepaper basket. That would cause the collapse of Scottish Ballet's position on the international stage and I think that—

Indeed, but that is not what I suggested.

But that is what would happen.

We are trying to have a discussion about—

Mike, let Mr Boyle answer the question, after which you may come back in.

Yes, but if we are to have a productive discussion, let us be honest about what we are saying: at no time did I suggest the situation that Mr Boyle has just described. Let us try to get back on a positive note.

It is quite common for appointments processes to take longer than the time scale first announced. I suspect that the vast majority of candidates would not find the addition of two, or possibly even three, months to the process difficult. Nobody is suggesting that applicants be dumped; it is being suggested that the process be loosened a little to allow the consultation period that the committee asked for in its report to take place. You may call that an independent review, a consultation carried out by external consultants or anything you like, but I would like us to examine the matter with the Robert North issue removed, as nobody is saying that he is not going. Would that not be a gesture on the part of the board, the Arts Council or the Minister for Tourism, Culture and Sport to show some respect for all those people who have been extremely upset by the process?

I will work backwards through that. People have most often been upset by disinformation, wrong information, confusion and bewilderment, not by the facts of the matter. On the position that you have put, my understanding is that the committee is seeking a better future for Scottish Ballet, which will take account of the views of the stakeholders. My understanding of the current consultation—like Duncan McGhie, I have done rather a lot of that around the country—is that the process in which we are engaged should, first, have an agreed focal point: the appointment of a new artistic director, who would provide an artistic vision. It is at that point that one would want to assess that vision in terms of its cost. From our point of view, all artistic visions need a pile of roubles at the end of them.

After that, one would want to go out into the community and translate that vision and give that information. That is what we intend to do with the various stakeholders. I do not think that we will help anything by pausing and by putting the whole recruitment process into jeopardy. If we go ahead and learn the lessons of the past, we can be confident of reaching a position from which we can instil confidence among all the stakeholders. Does that answer the question?

It does, but it disappoints me. [Laughter.] Unfortunately, I am usually disappointed by answers that I get from the Arts Council. That is regrettable, because I think that the Arts Council has an opportunity to contribute something.

I think that you were wrong in what you did last August, Mr Boyle. There is no getting round that; the committee believes that you were wrong in what you did last August, although you have not yet acknowledged that. I believe that you were wrong to come out so strongly against the committee's report when it was published; I think that that was the wrong reaction.

There is, however, an opportunity to move forward. Duncan McGhie has spoken about stability, which I would like too. All that is required is a period in which we have a genuine discussion about what the future holds with the people who are worried, upset or angry. What you have described is not a genuine discussion; it is putting certain things into place that cannot be changed and then asking, "How about the rest?"

A genuine discussion and just a marginal prolonging of the period of appointment would be a real gesture. That would fulfil what I believe—from what I have read in the Sunday papers and even, once, from what I heard from the minister—is required: a method of resolving the situation. I see the minister smiling, but we will ask him about that in a moment. If the minister achieved that result from that period, he might be happy and the committee might be happy. That would make the ballet-going public happy and it might even make the Arts Council happy. Who knows—it might even make Scottish Opera happy.

I think that all you are asking us to do is to offer empty reassurances. The most substantial consultation is one that goes out and tells people, genuinely, openly and candidly, as much as is possible. The principal thing—I am saying this for, I think, the third time—is the new artistic vision for Scottish Ballet. That is what we want to go and tell people about. We do not want just to go out and tell people, "There, there. Things will get better." We want to tell them, "Here is the person, here is the vision," and tell them what we think about it. Surely that is the way forward.

But that is not consultation.

I call Frank McAveety.

Consultation is not about telling people things.

By what you are suggesting about consultation, Mr Russell, all you are promoting is bewilderment and confusion. You are asking us to go out and say that we intend to recruit a new artistic director and that things will be better. That has a hollow ring. Let us see some action and a real, new artistic vision.

Is that genuinely your view of consultation? How very odd.

Mike, other members wish to ask questions.

I have listened carefully to what Mike Russell has said, but let us consider another parallel on the subject of the elongation of a contract, although it may be a daft one: it would be like keeping on John Barnes even after Martin O'Neill had been appointed as Celtic manager—

That would have been a great idea, Frank.

For a Rangers supporter such as Karen Gillon, that might be a suitable idea, but it would have been a tragedy from my point of view. If, as I think Mike Russell accepted, Robert North's contract will terminate at a certain time, which is, as is right and proper in employment, up for debate between the individual and the board, what is the purpose of elongating it? Can you, as part of your review—the process that you are arguing we should engage in over the next three to five months—match many of the aspirations that Mike Russell was suggesting? It strikes me that much more effective consultation can be carried out in parallel, with staff, stakeholders, the Friends of Scottish Ballet and the committee.

Given some of the comments that have been made this afternoon, I am not convinced that the role of the committee has been understood. Over the next few months, how can we engage with and meet Mike Russell's aspirations and move towards the creation of a truly national, high-quality ballet company?

If I understand your question correctly, Mr McAveety—

You can ignore the question about football—that was just me being facetious.

It is important that we should be able to describe our ambition through the press, through our offices and through any other means at our disposal, but that ambition cannot be fully established until the new director is in place. I do not manage Scottish Ballet and I am not party to the contractual negotiations. However, in my view, it is important that that phase be worked out as soon as possible. With the best will in the world, that is what is causing the present instability. Duncan McGhie was honest when he talked about the lessons of the past—I know that he means that, and that is what he told the committee. Surely the next steps should be to conclude the negotiations with the outgoing director and to get a new director in place. Is that what you were asking about?

I am doing some guesswork about what other members have said. However, as I understand Mike Russell's comments, he was asking how you can ensure that a process is established to engage with the committee's intentions on consultation and partnership in the absence of Robert North. At the same time, how can you engage with the staff—particularly the practitioners—to ensure that they can commit themselves to the new artistic director and to the new direction that the company is taking? According to the evidence that we have received, the key fault line is that people do not believe in that new direction. How can we find the space to achieve those aims?

You are right to say that the key people in the conversations that we are having are the dancers. We need to reassure the dancers that they have a future as classically trained, modern, Scottish dancers. From the submissions that you have received—including the evidence that you have heard today—you can see that what you are asking for is going to be extraordinarily difficult to achieve while the company remains split and while what I would describe as mischief making is going on. There must be good will on both sides. Scottish Ballet is stating its bona fides, but the information and the submissions that are still coming in to the committee from the other side do not seem to show bona fides, particularly given that the current director is leaving, as everyone—including the committee—accepts.

I will add to that answer by bringing us back to the remit of the review that we might eventually commission. The issue is not so much the remit of the review; the issues are the methods of consultation, who should be consulted and what they should be consulted about. Those issues need to be drawn into the equation. As Mr McAveety said, we need to ask how the staff are to be consulted, what level of staff should be consulted and how we can move the process forward.

We receive information about Scottish Ballet and about the other organisations that we support, and we have an on-going consultation process. The relevant committee in this case is the dance committee, which is widely representative of the dance community. Its members have a pretty wide knowledge of what is going on and a dozen or more of its members are already aware of what is happening. Therefore, our informal consultation process is already under way and members of the dance committee have been involved—and maintain their involvement—in the proposals from the ballet company.

Would you accept that a further issue is that of staff representation on the board? I know that that is a difficult issue, given that three trade unions are involved. However, from the SAC's point of view, would you encourage the company to find a way in which staff could become much more involved in the decision-making process?

We would certainly want to review how such staff involvement could operate and, as I said, which issues staff should be consulted about.

Would that be part of the review?

Yes.

Would the review produce a recommendation about that?

Yes.

I will follow up Mr Boyle's comments about the timing of the review. It is clear that there are two separate areas: governance—that is, the structure of the organisation and financial and strategic planning—and artistic direction.

I take many of the points that Mr Boyle has made. Although, unlike other members, I am not arguing for a pause before the new artistic director is appointed, I do not want any review to be delayed unnecessarily. I do not think that waiting until the new artistic director is appointed would necessarily be helpful, given that the review is likely to be a two-stage process. Do you have any further comments on timing?

Jackie Baillie's argument is reasonable. However, any consultation needs the full energy of those engaged in it. As members know, I am currently engaged in an appointments process, so I am aware of the need for a unified focus. The aim of my proposition is not to delay the review but to ensure that things happen in the right sequence. However, I take the point that the member makes and accept that the review should not be unduly delayed. It would be useful if a commitment to carry it out were made.

I would like to follow up on one of your answers, in which you explained that the quality of Scottish Ballet should be a key consideration when appointing a new artistic director for the company and that the appointment should lead to an improvement in quality. No doubt another key consideration for the Scottish Arts Council will be the financial situation of Scottish Ballet and what flows from the reputation that an artistic director generates for the company. What would the Scottish Arts Council's reaction be to an appointment that led to an improvement in quality but a fall in audience numbers, or, even worse, to an appointment that led to Scottish Ballet's receiving poor reviews as well as to a fall in audience numbers? What steps would the Scottish Arts Council feel it had to take in such circumstances?

As Duncan McGhie said, any competent company knows that it requires a judicious mix of programming to make its box-office pay. The answer must be to pursue quality at the same time as understanding one's audience. That rule applies to a television station as much as to a ballet company. One has to know what audiences to touch with one's programming. I know that I keep saying this, but the focal point must be excellence and raising the quality of dance at Scottish Ballet. The competent people who run Scottish Ballet—Chris Barron and the new artistic director—will understand programming, just as anyone ordering any kind of artistic programme does.

I asked Mr McGhie this question and am pressing you on it because, although a great deal of concern was expressed about Robert North as artistic director of Scottish Ballet, concern was also expressed about the fact that, just when he seemed to be getting higher audience figures and better reviews, he was put out the door. For that reason, there must be concerns about the appointment of someone new. Occasionally even Mark Morris now gets a poor review. When appointing a new artistic director, attention must be paid to achieving a balance between quality and audience numbers. If there is to be avant-garde work, that must be balanced by popular work. If it is not, we will end up having yet another inquiry into a financial crisis at a national company, but next time it will be Scottish Ballet.

I have not heard anyone from Scottish Ballet advocate avant-garde work. There has been confusion about the totality of the vision, which will not be cleared up until the new artistic director has been appointed. I understood the vision as being modern classical, which is why I, as chairman of the Scottish Arts Council, backed it. I will not say to Brian Monteith, "Beware of box-office numbers as a measure of quality." Rather, I will make the point the other way round. For quite some time, Scottish Ballet has not been represented on the international stage at the Edinburgh International Festival or elsewhere. We must make putting that right a touchstone of what we do. I counsel Mr Monteith against focusing on one production that was put on over the Christmas period—he knows the rest of the story. We seek a judicious mix.

I would like to make a small point that follows on very well from Brian Monteith's comments. The burden of everything that you have said is that you see the appointment of the new artistic director as the focus for the way ahead and the most important consideration for Scottish Ballet, from which everything else will flow. Might not your confidence be misplaced? All the things that you are saying about having an exciting new vision and about the way forward for Scottish Ballet were said as recently as late 1999, when Robert North was appointed. He was not presented to the nation as someone who would be bad for Scottish Ballet or who would lead the company into financial difficulties. He was the new vision for Scottish Ballet—the person who would lead the company forward, and so on. What guarantees do the Scottish Arts Council, the committee and the ballet-going public of Scotland have that the board's decision will be any better this time than it was last time?

All that one can do is liaise with people about the process. How can one guarantee artistic vision? We are trying in good faith to recruit someone who has a record of achievement. Irene McGugan has pointed out something that happens time and again: frankly, people get things wrong. On this occasion, I take my cue from the director of the Edinburgh International Festival, who is a formidable commissioner. His view is that Scottish Ballet has not shown any great development since Peter Darrell's time. That reinforces what the member has said. Robert North came on to the scene accompanied by all sorts of hopes, but the actions of Scottish Ballet prove that those were not fulfilled and that we must start again. If the member is making the point that it is impossible to ensure that the board makes the right decision, I put my hands up and say, "I surrender." Hopes raised by the appointment of Robert North were dashed, but we can only move forward in hope and with the proper ambition for Scotland.

I detect sloping shoulders. By saying that hopes were dashed, you are clearly putting the blame on the artistic director and not on the people who appointed him.

One can judge only on performance. I am not denigrating anybody. I did not come to today's meeting to talk about the current artistic director. I would always prefer to concentrate on the process rather than on the people who made the appointment. We need to ask whether the process went wrong and whether the wrong individual was appointed because the process was inadequate. If so, we can promise the committee that this time the process will not be inadequate. Part of Scottish Ballet's response to the committee is to make the new recruitment process utterly rigorous. In good faith, that is all that one can do. I take the point that Irene McGugan makes. All that I can promise is that Scottish Ballet will conduct a rigorous recruitment process.

I am pleased that we are hearing some realistic talk. What does that mean in financial terms? Scottish Ballet is currently in an intermediate state, and you are talking very positively and hopefully about the future. Are you in a position to resource the company properly?

We are in a position to resource the company, so long as we receive the necessary grant from the Scottish Executive. As Duncan McGhie said, he has provided us with competent business planning that is further reaching than any that we have received previously from the company. That is why the acting director and I have the fullest confidence in the plans. I cannot predict how the voted sum will change over the next few years or what resources the company will need, until I see what resources it asks for. Like all companies that make submissions to the Scottish Arts Council, Scottish Ballet will argue its case very strongly. We will have to be firm on the fact that there are other priorities, too. However, we understand the need for successful, high-quality national companies. That is all that I can say in answer to the member's question, but Graham Berry may want to pitch in.

The confidence that we have at the moment is built on the forward plan of which we have received early drafts. The plan indicates that the thinking is clear and long term and that resources are being matched with artistic ambition. That was not clearly the case in the past. To return to Irene McGugan's question, when previous appointments were made boards were unstable because of serious financial difficulties. The finances are now under control and there is a much better long-term plan, in which people can have confidence. We can now make progress.

It is useful to note that your view of the business plan is not shared by the head of fundraising or the director of finance of Scottish Ballet, who have a different view on the submission to the Scottish Ballet board.

You said that you are considering the process. Take Brian McMaster's statement about the lack of progress in the company since Peter Darrell's time. Surely to blame that lack of progress on an individual—the present artistic director—is the height of unfairness. Surely it is more likely that the history of Scottish Ballet—the lack of progress over a lengthy period—has something to do with process, funding and the operation of the structures in the organisation. It may have a lot to do with the company's instability—with the merger on, then off. Surely the artistic failure of the company—if there is an artistic failure, which some dispute—is much more likely to relate to process than to an individual who has been in post for less than two years. Do you agree?

I did not lay blame. I was simply talking about the present situation. When I referred to process, I was talking about recruitment. If you are asking whether other factors contribute to mediocrity or failure in a company, the answer is that they do. You are right and I do not dispute that. However, the artistic vision that we have at the moment is inadequate for what we want to achieve. The situation is as straightforward as that. I do not say that that is the sole factor and I do not think that anyone else does. As Graham Berry has just said, other factors have been involved. They have been cured. The artistic vision is another factor that we must get right.

Can I clarify the time scale for any independent review? The committee is particularly interested in that. If we are to make progress, it is important for us to know what time scale you are talking about so that we can talk in more detail about such a review with the minister.

We do not want to rush into such a review immediately. All the comments that have been made have been intended to allow Scottish Ballet to stabilise and progress sensibly. Anything that could be regarded as a major review would be seen as a possible block to the current progress. We want to move quickly towards writing a remit and agreeing how, when and by whom the work might be undertaken. I prefer that the review be delayed until such time as an artistic director is appointed or at least named.

I endorse that. We can now undertake to do that work. We can certainly work out the terms of a review. There are other important factors, such as the appointment of a new director for the SAC. At the moment, we are best placed to offer our bona fides, say that the review will take place and set out the first step by beginning to put together the terms of the review. That is best handled by an incoming director. Does that satisfy you?

It satisfies me in part. The committee has been pressing for employee involvement since the national companies review almost two years ago. To further put off addressing that issue and not to make any progress on it would cause me concern. Immediate dialogue with the relevant trade unions and the STUC is needed to consider how progress can be made.

We can do that right away.

I will widen the discussion slightly, although my point is in the same territory. We had an exchange about governance issues in Scottish Ballet. I think that you conceded that those issues did not need to wait for the appointment of an artistic director. I am keen to see progress on that. I am less keen for you to wait until the artistic director is appointed or named. Recruitment processes that are robust can take time. We need to show progress on that issue.

Yes.

I concur entirely with that view.

Subsequent to an inquiry into the governance of Scottish Ballet and Scottish Opera, the recommendation might be made to have two separate boards. If that happened and we had waited until such time as the artistic director was appointed, we could find that the composition of the board had changed considerably from that which appointed the artistic director, who might therefore find himself or herself without the board's confidence. That concerns me. It would be advisable for the governance review to take place before the appointment.

I take that point. We will begin the work, as I said.

I will make a point—perhaps a point of order—to the convener. Anything that the SAC chooses to do in terms of setting up reviews is its business. The committee issued a unanimous report that calls for

"a period of genuine consultation and debate".

The committee needs to discuss whether the proposals that we have heard meet that call. I do not find that they do. Although the SAC may do what it wishes, I do not believe that the proposals answer the call. I hope that the committee is not indicating that they do by having the discussion.

That is not a point of order; it is a point for the committee. It is for the committee to decide how it progresses the issue after we have heard from all the witnesses and considered the information that we have. We are not taking a view on anything—

I would like that assurance.

We are not taking a view on the proposal that you made about extending the artistic director's contract or on anything else. The committee will take views on the issues in a formal session, not on the hoof in response to evidence. That is how we have conducted ourselves in the past and it is how we will do so in future. We have not concluded hearing from all the witnesses. We cannot make any recommendations or take any views until we have done that. Members should take a view at the appropriate time.

I am reassured by that.

I thank the witnesses for their evidence.

I suggest that we break for five minutes.

Meeting adjourned.

On resuming—

We are now quorate. I welcome to the committee for the first time the Minister for Tourism, Culture and Sport, Mike Watson. Do you want to make introductory comments, minister, or do you want to move straight to questions?

I will make a brief statement. My comments are pretty well encompassed by my letter to you of 8 January.

I share the committee's view of the important role of the national companies and of the difficult period that Scottish Opera and Scottish Ballet have come through. I hope that we can move on to a more stable future and build both companies' audiences here and further afield.

I am clear that Scottish Ballet has a positive role to play within the Scottish Arts Council's dance strategy, which was published recently following consultation. The strategy shows the interest there is in dance throughout Scotland. I want the strategy to be taken forward, with Scottish Ballet at the forefront.

I did not deal in my letter with individual points in the report, which, unlike the recommendations, were not aimed specifically at the Executive. However, I hope that I have covered the ground in my letter.

We made a point to all the witnesses about an independent review of governance. You, too, have referred to that matter. You heard some of today's discussions. I would be grateful if you would expand on what you think would be a positive way forward for a review of the governance of Scottish Opera and Scottish Ballet and how matters will operate in the future.

I said in my letter that I welcomed the recommendation that the Scottish Arts Council should instigate an independent review of governance. Duncan McGhie, on behalf of Scottish Ballet, accepted that point. I endorse such a review and think that it would be helpful.

That does not necessarily cut across the committee's view as stated in the report. Without looking up the exact paragraph, I think that the report suggests that Scottish Ballet should consider urgently the structure of its board. Scottish Ballet did that and is keeping it under review.

The matter of general governance is different; it would be helpful and welcome for that to be independently examined without any suggestion from those involved about the preferred outcome. It is important that there are no preconceived notions about the outcome.

I welcome the minister's comments. I regret that I have not seen the letter of 8 January, so I might stray into some of the territory that it covers. I am interested in the timing of the review, which was the subject of discussion with the Scottish Arts Council earlier. Do you have a view on the optimum timing of the review and on how it should be conducted?

The review should be carried out as soon as practicable, although that answer does not get us much further forward. Brian Monteith made the fair point in his question to Mr Boyle and Mr Berry that to await the appointment of a new artistic director might create difficulties. I hope that when the outcome of the independent review is known, everyone will move forward on the basis of that outcome. It might be beneficial to know the outcome of the review before the new artistic director is appointed. The other side is that perhaps there is a need for stability to allow a new artistic director to be appointed. I do not have a firm view. I return to the terminology "as soon as practicable". I want to consider the matter further.

As I understand the matter, Robert North's contract continues until August and the artistic season goes on until the end of June. I know that applications have been invited and that a shortlist will be drawn up in the near future. The new artistic director might not take up his or her post before the end of this year or the beginning of next year. I hope that members understand my point. I do not want the appointment to be delayed for too long because the longer the process goes on, the longer the uncertainty continues.

I agree that there are issues of stability, trust and confidence. It would be a measure of good faith and good planning to kick-start the review well in advance by covering issues that do not deal with the artistic director. My impression from the evidence is that covering those issues is a necessary part of the process and should not be left any longer.

You made the point that governance is not only about the board; it is about financial and corporate strategy.

We come back to the issue of employee involvement time and again. The committee feels strongly that there should be employee involvement of some form on the board. Does the minister have a view on how that can be considered further?

Employee involvement is one recommendation in the committee's report, which refers to the Royal Scottish National Orchestra and the Scottish Chamber Orchestra, which have player representatives on their boards. Generally, that is a good thing because the more that a board carries people with it—particularly those who are involved in putting into practice what the company markets—the better. In my experience, management in all sectors benefits from having the confidence of the work force. The proposal is useful, but its mechanics are a different matter. The STUC representatives mentioned that many unions represent the employees. I know from my history in the trade union sector that it is not easy to resolve the issue of who should be a representative. There are difficulties but, in general, the proposal is good and could help to overcome some people's feelings of not having been involved.

This is the first time that the minister has given evidence to the committee in his culture role. So far, he is streets ahead of his predecessors. It seems that he is listening—thank goodness—to what the committee is saying.

That was a fatal blow to the minister's career.

Yes, it is probably the end of his career.

I did not know that you had Greek lineage, Mr Russell.

What you are saying, minister, is very helpful. It is extremely important that you are not taking a dogmatic stance on what this review might do and when. You have spoken about your trade union experience, and you know better than I do that, in circumstances such as these, it is important to regain the work force's confidence in the way in which it is managed and directed. That confidence has disappeared.

You have met some of the dancers and you have seen the document that the committee received from seven of the management team. Those seven people include managers involved in fundraising, education, finance and administration. The document can be disputed—James Boyle chose to dispute it. Those people are tremendously worried. I therefore ask you to acknowledge that regaining the confidence of the Scottish Ballet work force in the direction of the company will be an extremely important part of the review process. The terms of the review, and the choice of the person or persons to carry it out, will be extremely important.

I accept that, but I would not want the review to delay the process of appointing the new artistic director. I understand that dancers and senior staff have, in the past, had the opportunity to meet the shortlisted candidates for the post of artistic director, and I understand that that will happen in future. I also understand that Scottish Ballet is offering representatives of the Friends of Scottish Ballet the opportunity to meet the shortlisted candidates. There are therefore signs that staff will be involved in the appointment of the new artistic director. Ultimately, it will be for the board, the Scottish Arts Council and me to decide, but there will be significant staff involvement.

The minister will acknowledge that any feeling among key stakeholders such as the dancers, the technical staff and the management that the die has been cast for the future of the company before a review has taken place, and before meaningful discussion and consultation has taken place, will exacerbate the situation.

Nobody is trying to stop the process; everybody accepts that there will have to be a new artistic director. The key stakeholders must have confidence in the people who are carrying out the review and they must be satisfied with the time scale allowed for it. Nothing must be put in the way of that review. It must not appear to the stakeholders that the die has been cast. The way in which the review is presented is extremely important if we are to arrive at a solution that will stabilise the company.

I am not quite sure what you are referring to when you speak of the die being cast. Are you referring to an individual, to the artistic direction of the company or to the future management structure of the company? I would not want any die to be cast. If we are to have a review, I would hope that that review could produce conclusions that could be implemented as quickly as possible in Scottish Ballet.

You heard Duncan McGhie make the point—and I raised it with James Boyle—that the history of Scottish Opera and Scottish Ballet over the past few years has been one of considerable instability and considerable financial brinkmanship—this committee's report uses that very word. As you are the new minister with responsibility for culture, I presume that you are keen that that history is not repeated and that the situation is stabilised. Do you have any recommendations over and above the proposed review of the company? Are you undertaking reviews of the company's operation or its relationship to the Scottish Arts Council or the Executive?

No. That has not been considered.

I welcome the minister. I hear a great deal about the Scottish national theatre, because money has been committed to it, yet it is in limbo. Many people in drama are also concerned because funding has been increased for English regional theatre, and they believe that Scottish theatre should have more funding. Given that background, how can the minister help the Scottish Arts Council financially not only with those drama projects, but, more important, with the additional funding that Scottish Ballet may require?

That was rather a broad interpretation of the subject.

A tenuous link, Mr Monteith.

At best.

As Minister for Tourism, Culture and Sport, I will make representations for increases in funding as part of spending review 2002 on all aspects of my portfolio, which is new. I will negotiate with colleagues—Ms Baillie is familiar with the process—but ministers do not get everything that they want. I assure the committee that I will aim to do the best that I can for all aspects of my portfolio, whether in culture or otherwise.

I ask Brian Monteith to stick to Scottish Ballet.

I gave that background because I am concerned that the minister might be left with choosing one option or the other. Will the minister assure us that Scottish Ballet will be given priority for resources?

I do not think that I will have to make the choice between drama and ballet that Mr Monteith describes. I can only repeat that I am aware of Scottish Ballet's situation. Other companies might be in a similar position. It is my duty to do the best that I can for my whole portfolio. It would be premature to set out priorities at present. Scottish Ballet has been highlighted. I would like stability in the company as soon as possible.

Do you intend to respond formally to the committee's report on Scottish Ballet within the set 12-week period?

No. In effect, my letter was my response. As I said, no recommendations that the Executive do particular tasks were made, so I responded by letter. I am sorry if not everyone has seen that.

The letter has been circulated to members.

I thank the minister for his evidence. I am sure that we will see him again in due course.

Without a doubt.

The meeting will not always be like this. It will be a bit livelier the next time that the minister is present.