O'Donoghue proposes radical reform at Abbey

Minister for Arts John O'Donoghue is proposing the most radical change in the governance of the Abbey Theatre since its foundation in 1904, The Irish Times has learned.

Under the proposals, which will be put to an extraordinary general meeting of the theatre's Advisory Council on Saturday, the National Theatre Society, which has survived for over a century, will cease to exist.

It will be replaced by the Abbey Theatre Limited, a company limited by guarantee, thus abolishing the shareholding body that currently owns the theatre and elects much of its board.

The proposals, which are supported by the Abbey's current board and by the Arts Council, are a response to the financial and managerial crisis that has engulfed the Abbey since it emerged last May that the company's losses last year, at €1.85 million, were twice the reported level.

Last month, a report by the consultants KPMG identified serious accounting errors and poor financial controls at the theatre. It placed the ultimate blame on the Abbey's convoluted governance and recommended that the theatre's board should in future be chosen on the basis of a defined set of skills.

The new plan aims to achieve this goal while at the same time guaranteeing the Abbey's future independence. At present, the Abbey's board consists of two Government nominees, four nominees of the National Theatre Society's shareholders (who make up the Advisory Council), one staff representative, one actor and one playwright. This system is widely seen as creating factions within the board and as failing to guarantee a suitable spread of skills for the oversight of a company with a multi-million euro turnover.

Under the new arrangement, the Minister for Arts will nominate the chair and two members of the nine-person board. The other six members will be appointed by a selection committee made up of the Abbey chair, the chair of the Arts Council (or a member of the council appointed by the chair) and an "independent person of standing in the arts sector, nominated by the Minister for Arts".

One of these six would be a staff representative and the other five would be chosen according to a "skills matrix" to include artistic, cultural, financial and managerial abilities. The selection committee would also be obliged in its operation to "guarantee the ongoing independence of the theatre".

The current Abbey board has already agreed to resign when the reformed structures are put in place, but the National Theatre Society cannot be dissolved unless the new plan is approved by the 21-strong shareholding body that makes up the current Advisory Council. The council, of which both Mr O'Donoghue and Minister for Finance Brian Cowen are members, will have to debate the proposals in the knowledge that, unless they are accepted, further public funding of the theatre through the Arts Council is unlikely.

Arts Council chairwoman Olive Braiden said last month if the National Theatre Society did not dissolve itself, the council would "make no further funding available."