In January 2026, the government announced a £1.5bn package of capital investments for cultural organisations over the next five years. This provides a welcome financial boost for the arts and culture sector after more than a decade of declining public investment.
While artistic programming often receives the spotlight, the less glamorous side of organisational sustainability – repairs, maintenance, and long-term capital planning – is still vital. Maintenance needs are notoriously difficult to fundraise for, yet failures in these areas can create profound operational, financial and reputational risks.
To be forewarned is to be forearmed
Deferring essential maintenance can be catastrophic. Minor, inexpensive works, such as outdated wiring or a roof leak, can quickly escalate into major failures if left unaddressed. Supply-chain disruption and inflation in the construction industry also mean that delaying works often increases costs significantly, stretching tight budgets even further.
Despite these risks many arts and culture organisations only prepare short-term detailed budgets, typically looking between one year to 18 months in advance. This may make sense from an artistic programming perspective, but capital and maintenance works are often predictable much further into the future.
For this reason, where buildings or other significant assets form a fundamental part of your activities, it is crucial that you also prepare a detailed capital and maintenance budget that looks further into the future – five years at a minimum; but 10 years is advisable.
Even charities that do not maintain their own buildings can still find value in a long-term capital and maintenance budget, because capital planning is also required for software systems and for other technological investments.
How to approach the budget
A capital and maintenance budget is typically split into two parts: the capital element, for long-term investments such as building projects and major upgrades; and the maintenance element, which should identify the works required to keep assets running safely and efficiently.
Your fixed-asset register is usually the best starting point, providing it is up to date and complete, and should be reviewed to identify assets that need replacing or repairing soon. An internally-conducted survey of your buildings and other assets should also be performed to ensure everything is captured.
For organisations with more complex buildings, an externally commissioned survey can help to ensure that all structural and operational risks are properly assessed. Once you have your full list of needs, you should assign estimated costs to each item and then refine the budget by order of priority, which should consider safety and compliance as well as both strategic and operational aims.
Once the budget is prepared, it must undergo a thorough review process by management and the trustees, with stress testing performed to assess the impact of rising costs or unexpected asset failures.
This approach helps to minimise your reliance on reactive maintenance, which is often more costly and disruptive than planned works. The capital and maintenance budget should be built into your full budget and cash flow forecasts.
A fundraising and reporting tool
Once established, your capital and maintenance budget can be a helpful fundraising and communication tool. Donors and funders often appreciate having a clear explanation of an organisation’s needs and may be more willing to contribute when they understand exactly how their support will be used.
The budget can also form part of your charity’s reserves management strategy, as it can help trustees when they are reviewing the level of reserves that the charity needs to hold. Where unrestricted and free reserves are available, boards may wish to designate funds specifically for maintenance or capital needs, communicating to the reader of the accounts that the charity has a need for liquid reserves to cover the estimated cost of these items.
The budget should also be used when you are updating your risk register and should be monitored as part of your risk management processes. Critical assets can be separately identified on the risk register, with responsibility for monitoring each of these assigned to an individual in the management team.
Jane Askew is a partner at HaysMac
