Terence Blacker: The appalling shambles of our arts policy

These are golden times, apparently, for the arts. Last October, a £1bn settlement on the Arts Council was confirmed. One of the council's senior strategists has predicted, as from next month, "the start of very, very exciting times in the theatre". Meanwhile a government-commissioned report into artistic excellence, written by Sir Brian McMaster, is published this week.

Rather than, as had been feared, introducing a new tier of league tables and guidelines, the report criticises the imposition of simplistic targets and supports the involvement of practitioners rather than arts bureaucrats. "We could be on the verge of another Renaissance," says Sir Brian.

Well, hurrah for that – we need all the pie-eyed optimism we can get at this time of the year – but it is the more precise proposals of the report which are of more interest. Since Sir Brian's conclusions will have been available to the Arts Council when it prepared its latest round of subsidies, they offer a perfect opportunity to see how they work in practice.

The answer, to judge from the appalling shambles over which the Arts Council is currently presiding, is that Sir Brian has been wasting his time. The old evils of secrecy, inconsistency and an obsession with idiotic targets are more evident than ever before.

In December – significantly, just before the Christmas break – 194 cultural organisations were informed that their funding would be substantially cut or ended altogether. They had until 15 January to appeal. Final decisions would then be made by the end of the month.

"Where organisations are failing, funding bodies must intervene strongly," says the McMaster report, but these perceived failures are utterly bizarre, by any sane standard. The superb Bush Theatre, which brings the best new writing and directorial talent to a pub on Shepherd's Bush Green, is to have its grant virtually halved. Excellence is not the issue here – the Bush staged the first plays of Joe Penhall, Conor MacPherson and Charlotte Jones among others. Apparently, the council has decided (on faulty figures, says the Bush's artistic director Josie Rourke) that audiences are not big enough.

But hang on. McMaster decried funding decisions being made based on "simplistic targets" and the Culture Secretary James Purnell welcomed a move from "measurement to judgement". Could any targets be more simplistic, any measurement less carefully judged?

As for the laudable aim of introducing the arts to new audiences, few organisations can have worked harder in recent years to take plays into rural communities than Eastern Angles – another company to have its funding halved. For most of the year, Eastern Angles takes plays which commemorate and celebrate the history and culture of the East of England around towns and villages in the area. In cornhalls, churches and village centres, they remind audiences of the importance of local language and memories in the face of the big and the bland in contemporary life.

Unbelievably, the Arts Council has explained that Eastern Angles does not travel far enough. The company is apparently too local, too rural, to justify continued support.

"Transparency, of course, is incredibly important," Sir Brian has said. As was pointed out by several of the high-profile theatrical protesters who gathered at the Young Vic on Tuesday, the worst part of these idiotic decisions has been the secrecy which has surrounded them. Only one thing was sure – there was no hint of the peer-group assessment which the McMaster report deemed so important.

It is said that the trend of funding is towards modishly visual arts with street theatre and the new technology being preferred to traditional forms, but what really seems to be happening is squeezing out the small, the individual and the particular. The microscopic amount of public money given to independent publishers who support new and foreign writing in the face of the accelerating Tescofication of the book business is, sure enough, about to be reduced still further. Two small but valiant publishers, Arcadia and Dedalus, have been told that their grant will be cut and know that they face an uncertain future.

It is a complete cock-up – bad, unfair decisions, incompetently made. If the Government's commitment to the arts means anything, it should tell the Arts Council to look again at its latest funding plans, having first studied the McMaster report rather more carefully. In the meantime, anyone who values the defiantly individual, the local, the artistically excellent should protest against these half-baked, ill-thought-out decisions.