How not to buy a Rembrandt

Picture: Wales Online

Two big Rembrandt deals have been announced recently. Both reveal wastefulness and foolishness in public art acquisitions.

The UK government has placed a temporary export block on Catrina Hooghsaet (above), which is being sold from Penrhyn Castle. The Telegraph reports that a private buyer has agreed to pay £35m plus sales tax of £660k. The painting is exempt from sales tax, so presumably £660k is due on agent's fees of £3.3m. UK buyers have until 15 February to register interest in buying the picture. 

I hope no one does. The picture has been openly marketed for years; the Rijksmuseum came close to buying it. There was ample opportunity to negotiate a friendly deal without the need to pay millions to Sotheby's. I don't begrudge dealers' mark-ups or agents' fees, which are fairly earned in a competitive market. But British institutions have a woeful history of waiting until the last minute and then declaring a national emergency, when a bit of foresight would save millions. If anyone wanted it, the should have said so earlier. They will seem incompetent if they only raise their hands now. 

The other element I find objectionable is the smoke-and-mirrors approach to funding acquisitions. An element of tax that's been deferred could potentially be removed from the sale price, making it cheaper for a British public collection to buy the picture. But the real cost to the UK taxpayer doesn't actually change. It makes no financial difference if the tax is collected and then spent on a painting, or if the tax isn't collected in the first place. But it does give an artificial incentive to buy pictures subject to tax deferral, which is an arbitrary way of choosing acquisitions. I've written more about it here, and discussed on the BBC's One Show here.

Finally I don't think it's the best way to spend £35m. It's a fine picture, and I'm a great Rembrandt fan. But it's not one of his best, and we've got quite a lot in the UK already. Spend the money on other things, and please try to buy wholesale not retail. Lots of great pictures are sold for surprisingly modest prices, and £35m could fill some serious gaps in British public collections.

Picture: Dutch News

The French and Dutch governments have jointly bought this pair of full-length portraits by Rembrandt from the Rothschilds for €160m. The Dutch came up with €80m shortly after buying a Adriaen de Vries bronze for almost $28m, yet they are so short of funds for operating costs that they have to close at 5pm each day to cater for private events. When you consider the value of the Rijksmuseum's entire collection, there is no way that they money they're getting from plutocrats and celebrities can cover the cost of capital for the public asset they are exclusively enjoying. But every day the oiks are kicked out in the late afternoon so the privileged few can party away in evening. 

It's a chronic problem in the art world that money can be raised from public funds and private donors for big acquisitions and flashy extensions, but no one wants to pay for more modest acquisitions or for the running costs of all the new wings. The Dutch government should have spent the €80m on opening later so the public can enjoy what's already there. 

My other concern with this dumb deal is that the pictures will be shared in perpetuity, meaning that these large and fragile pictures will be moved between Paris and Amsterdam every few years. There will always be minor damage when big pictures like this are shipped hundreds of miles. But what happens if they become too fragile to move? And what happens if the museums disagree on restoration? Or if one museum wants to lend them elsewhere, to the Louvre Lens for example? What will happen if the Louvre wants to rent them out to a foreign museum? Or if the two countries fall out. It is inconceivable in the medium term, but forever is a long time and who knows what will happen in 300 or 500 years. Shared ownership of art is an absolutely terrible idea. When a crisis happens, it will seem obvious in retrospect. But right now the deal is being naively praised as 'saving' the Rembrandts, as if any other buyer would destroy them. I'd certainly be sorry to see them disappear to a private collection, but I'd be much happier if they'd both been bought by the Getty or the Kimbell. 

'Donations' in lieu of tax: a stupid way to fund the arts

Picture: University of Cambridge

Margaret Thatcher's archives were recently transferred to the nation in lieu of tax, under a scheme that's seen many important artworks and historic documents transferred to public ownership. We even got her handbag (above). The Thatcher archives have been controversial, but for the wrong reasons. There's no question of their importance, whatever you think of Margaret Thatcher. But the scheme itself is absurd. I've done an interview with The One Show on BBC about the acceptance in lieu scheme, which should be broadcast on Friday. Acceptance in lieu almost universally popular because it seems to give free pictures to museums. The official website explains its advangages:  "The primary benefit for a host/acquiring museum, gallery or library is that it receives an important object at no cost".

 

But this is nonsense. These are not free objects. They are objects bought out of foregone taxes. If the tax were paid to the Treasury and then given to the museum, it could spend the money on any picture it liked. What are the chances that of all the pictures available in the world, they'd want the very one handed over in lieu of tax?

 

The beneficiaries are not museums, but the wealthy people with important pictures on their walls and archives in their attics. I don't for a moment blame them for using the scheme - I would in their shoes. They aren't cheating the system; they're using it exactly as it was intended. Our ire should be directed at the Treasury. This is just one of many examples of misleading policies that benefit a tiny number at the expense of the majority. They are pretending that it isn't really arts funding, because the transfer takes place instead of gathering tax and distributing it.

 

The iniquity stings twice. First, it stings that the very wealthy can enjoy such a splendid privilege. Can you imagine the reaction if you offered to pay your council tax by spending a few hours doing some gardening in the local park, and offering your labour at £50 an hour? I'm going to hazard a guess that they won't convene an expert panel to assess the quality of your work and value of your labour. But if you have an important picture you not only get to save on transaction fees from selling it on the open market, you get a tax rebate too - you save a quarter of the tax that would have been due on the object. The other side, of course, is that taxpayers are paying extra for the privilege of acquiring something via the acceptance in lieu scheme. It's actually a more expensive way to buy stuff. And the people transferring objects are often treated as philanthropists, and credited by the museums as donors. They are not donors; they are simply taxpayers. And they're using a loophole that means they are paying relatively less tax than the rest of us. We are paying more than they are.

 

But the scheme also stings because we keep getting more of the kind of pictures that happen to have been popular with British collectors - unsurprisingly, they're the pictures that are usually quite well represented in our national collections, too. We've just got a cache of 44 Frank Auerbachs, which are fine pictures, but do we need so very many of them? We have a total of 54 Auberbach oils alone in British public collections, but not a single picture by the American abstract artist Richard Diebenkorn. And where are the early German pictures, the Scandinavian art, seventeenth and eighteenth century French paintings, nineteenth century German art, and American art, all poorly represented in both public and private collections in the UK? We're missing out on so much because our acquisitions are skewed towards 'saving' more of the same.

 

The cultural sector is extravagantly grateful for acceptance in lieu. But it's a bit like getting a pay rise, but then being told that it will be paid in the form of a monthly delivery of groceries chosen by your employer. Getting a free grocery delivery is better than not getting one. But if the cost is the same to my employer, I'd rather have the cash thanks all the same. And can you image a public company choosing to pay in groceries, but then deciding to pay the supermarket a bit more than their retail prices? That's what the government is doing when it buys pictures under the acceptance in lieu scheme. Shareholders would demand the board be sacked if it were a public company; as taxpayers we should be holding the Treasury to account. To be clear, I'm not making a partisan point here. Acceptance in lieu enjoys cross-party support, and no party has a monopoly on distorting tax schemes. But they should still be held accountable for this stupidity.

It's even more stupid in the context of funding cuts that mean we can't get to see the stuff we're acquiring because museums can't afford to keep the doors open. Money is available for acquisitions, but not for running costs. The British Museum has acquired some wonderful drawings under the acceptance in lieu scheme. But it's just slashed the opening hours at the print room, so it's now harder to see them. And we're acquiring archives, but shutting libraries. It's perverse to keep buying things when we can't afford to display them. 

 

Of course the risk for the cultural sector is that the acceptance in lieu scheme gets scrapped without any compensating payment. But we are citizen as well as art enthusiasts, and we have a duty to play fair. We should seek to win the argument for funding on its own terms, not on the basis of secret subventions. And those secret subventions impose a real cost. It is more expensive to acquire via acceptance in lieu, because of the extra tax rebate. And too often it means we acquire the wrong things; museums need to get more creative with their acquisitions, and the Treasury should be a little less creative in its accounting.