Who can fill the RSC's empty stage?

Three years ago the Barbican Centre called in a firm of theatre consultants to give some advice to its then director, Detta O'Cathain, and her masters at the Corporation of London. They wanted to know what the future would hold for the Barbican Theatre if the Royal Shakespeare Company were to pull out.

The RSC was going through one of its periodic financial crises and, unless some extra cash was found, bankruptcy - let alone withdrawal from London - was distinctly on the cards. It looked as though the writing was on the wall.

It did not take the consultants long to come back with a convincing but thoroughly unhelpful answer: without a resident company or companies in place, they said, the theatre would face hard times. It is not hard to see what the problems are. So far as commercial theatre is concerned, there is little call for an additional stage, certainly one that is far from the West End. The auditorium is too small for big musicals - and besides, the theatre was designed specifically for the RSC. So the City fathers gritted their teeth, joined hands with the Arts Council and massively increased its subsidy.

Now the Barbican's troubles have returned, in spades. Last November the stormy Baroness O'Cathain left in a whirlwind of hard words, and now the RSC has unilaterally decided to reduce its year-round presence to a six- month "winter festival".

Can nothing be done to fill the theatre or will it have to go dark for half the year? There is a way forward, but only if the concept of a single residency is replaced by one of multiple residencies. Three avenues are worth pursuing and although they would be expensive the Barbican will be reducing its pounds 3.6m annual grant to the RSC. So there will be bob or two to spare.

Although most regional theatres are in a state of permanent financial crisis, there are a handful of big companies that would welcome regular annual residencies in London. The Royal Exchange in Manchester has long had an eye on a London base; the Birmingham Rep, Nottingham Playhouse and the West Yorkshire Playhouse are all producing work of a scale and distinction that London audiences would enjoy seeing, given a chance.

An equally promising option would be to give house room to non-London opera companies. English Touring Opera could launch new productions before setting out on tour, and with appropriate subsidy it might be possible, if the orchestra pit was enlarged, for larger companies such as Scottish Opera, Opera North and Welsh National Opera to pay regular visits. The Royal Opera House could perch at the Barbicanduring the closure it is planning for redevelopment, especially if it concentrated on Mozart and the smaller scale repertoire.

Third, the dance world has been agitating for many years for a National Dance House. The Barbican does not have a large enough auditorium or orchestra pit for large-scale ballet and most dance companies will not rest until they have their own permanent purpose-built theatre. But in the meantime, the Barbican could offer middle-scale and contemporary dance groups an excellent base. As soon as yesterday's news about the RSC broke, senior figures in the dance world were busily talking to each other about the possibility.

These are exciting prospects and after a brief pause for rage with the RSC for betrayal of trust, the City fathers are already thinking creatively of how to retrieve their damaged investment.

But if they succeed in devising a new strategy for the Barbican Theatre - and it will take much hard thinking and talking before it materialises - there is likely to be an illustrious victim. This must be a gloomy day for Sadler's Wells in Islington, one of the country's best loved but most inconvenient theatres. Its ambitious reconstruction scheme is a candidate for National Lottery funding, but where will its future lie if dance and opera can find a modern well-equipped home elsewhere?

It would be only human if the Corporation of London feels sore about its bitten hand; but imagination, especially when supported by an open chequebook, can surmount most obstacles.

The writer is a former secretary general of the Arts Council.