Holland’s world-renowned orchestra announces possible closure in light of money woes.

Widely regarded as one of the world’s finest orchestras, it would be easy to assume that Holland’s Royal Concertgebouw Orchestra is a cultural institution immune to the financial struggles facing many arts organisations around the world. However in its 2013 annual report, released this week, the RCO has announced that without immediate intervention by the Netherlands government its financial reserves will be rapidly depleted by its unmanageable overheads, and it will be forced to disband by 2016.

The dilemma faced by the orchestra is that the rising costs in the wages of its players and administrative staff has exceeded the maximum revenue the orchestra can generate from its performances. In an interview with Holland’s daily paper, NRC Handelsblad, Concertgebouw’s Business Director David Bazen spoke of the increasingly difficult situation in which the orchestra has found itself, “Our position is still very strong, but it is rapidly weakening”. 

The Royal Concertgebouw Orchestra

Even in spite of the orchestra’s highly acclaimed world tour last year, which included the orchestra’s Australian debut at the Sydney Opera House in November, Concertgebouw reported an eye watering deficit of €863,461 ($1,213,896AUD by today’s exchange rate) in their 2013 financial summary.

The orchestra’s financial plight has been further compounded by the limited number of rescue options available to it. Royal Concertgebouw concert tickets are already more expensive than almost all other European orchestras so a price increase isn’t tenable, and its performing schedule is already at maximum capacity. Commercial sponsors have also been difficult to secure given the orchestra’s precarious financial position and so a government bailout is seen as the only viable option to avoid catastrophe. However, even though the RCO is by far Holland’s most respected and revered cultural export, further public subsidy may be difficult to justify. The orchestra’s Musical Director Mariss Jansons has recently announced his retirement, leaving this sinking ship rudderless, and while attracting a new director who will be a big draw for audiences should be a relatively simple task given the orchestra’s outstanding international reputation, it won’t be a cheap investment. RCO have also enjoyed increases on its annual subsidy in recent years while many other orchestras in the Netherlands have experience significant cuts to their government funding.

Royal Concertgebouw General Manager Jan Raes

While many orchestras across the world have been forced to adapt to evaporating financial resources by reducing the size of their staff and employing musicians part time, Concertgebouw General Manager Jan Raes has made it clear that any such changes to RCO will only be made as a last resort. Speaking to NRC, Raes’ indefatigably stated “a cut in our artistic power is the last thing we will do”.