Newcastle City Council's Labour leader Nick Forbes claims he has no choice but to axe much of the Council's arts spend; but is he instead trying to execute a dangerous bid for more Government money by holding the city's culture hostage?
Speculation is growing as to the honesty of the Council's position as writer Lee Hall, the man behind Billy Elliot, has called the move "a philistine attack on the arts".
Both Newcastle and Gateshead are facing considerable spending cuts: £90m and £70m respectively. However Newcastle is proposing to slash the £1.6m budget for major arts venues with a 100% funding wipe out whilst Gateshead only plans to reduce them in line with other cuts.
Director of Newcastle's Live Theatre, Jim Beirne, met with Cultural Secretary Maria Miller and Arts Minister Ed Vaizey on Wednesday in London to emphasise the severity of the situation.
He conceded that Newcastle Council are "between a rock and a hard place", but equally argues that 100% cuts don't make economic sense.
Both Miller and Vaizey were concerned about the situation in Newcastle, but perhaps predictably stated that tough decisions were being made everywhere.
Concerns within the arts world are running high and Newcastle is being very closely watched lest this becomes an indication of things to come nationwide - already the disdainful phrase "Doing a Newcastle" is starting to be heard elsewhere in the country.
Newcastle City Council recently announced plans to close 10 of their 18 libraries, the City Pool and City Hall, before delivering their final statement - that funding for the city's flagship arts spaces will be cut totally.
This could prove an irrecoverable blow to venues such as the city's Theatre Royal, Northern Stage and Live Theatre, which commissioned Lee Hall's internationally celebrated Pitmen Painters, and which all do so much valued education and community work beside the shows on their stages.
Nick Forbes conceded that the decision had prompted "quite a lot of justifiable anger", but the Council's only explanation of the proposed cuts so far has been to blame central Government. Forbes says three elements have left him with no choice. Firstly, council grants nationally have been cut more severely (28 per cent) than most other areas of Government spending.
Secondly, grants are decided based on a formula by which it does seem Newcastle has been treated harshly compared with other cities. Whilst Newcastle's cuts equate to £160 per head, other parts of the country will suffer by as little as £5 per head. Forbes said if Newcastle were receiving the average cuts, their £90m figure would be reduced by £22m.
Thirdly, Newcastle was more vulnerable to cuts because of its higher dependence on Government grant than other parts of the country.
The arts take up a minute 0.7% of Newcastle Council's current annual budget however, and each pound spent by Newcastle and Gateshead's councils on their acclaimed arts venues last year returned £4.06 into the regional economy.
Libby Purves in the Times this week called the arguments for the wholesale cuts to the arts:
"Lazy, shameful mush; disingenuous populist pretences that it's a straight choice between sick orphans and bobbies on the beat or pampered leftie powers spouting Pinter and toffs in opera hats. It's not."
Particularly in Newcastle and Gateshead the arts organisations contribute so much more to communities than just productions. Last year they worked with over 613,000 children and young people - just the kind of work Newcastle Council says it values.
Forbes has described the Government's budget changes as "an ideological assault on our public services". He added that, by blaming his Council, as many have started to do, we are only "playing into Tory hands".
This is starting to look like a dangerous game of poker, with arts venues which local communities trust and value being threatened with a complete funding cut seemingly to make a political point.
Nick Forbes says he has asked for a meeting with David Cameron to discuss the issue. Perhaps this could be an attempt to quell growing public concern by appearing to be doing something proactive. Or maybe he genuinely hopes that the Government might increase the city's grant - though evidence elsewhere hardly encourages that hope.
Does the council expect to tug on Cameron's heartstrings by flaunting a devastating massacre on North East culture which the Council says it is being 'forced into?
When the country is becoming increasingly worried about public spending cuts on all fronts, with high profile figures such as Danny Boyle and National Theatre Director Nicholas Hytner publicly shunning the Government - saying they have done "next to nothing" to encourage cultural philanthropy - it hardly seems likely that David Cameron will risk opening a competitive regional can of worms with a one-off Tyneside handout.
Speaking out about Cultural Secretary Maria Miller at a recent conference, Danny Boyle exploded:
"Not one of those [artistic directors, including Hytner] has been even approached by this woman ... that is outrageous. She is the minister of fucking culture. I mean, come on."
Miller has since met Hytner and promised to press the issue with the flinty Local Government Secretary Eric Pickles, but few are holding their breath.
The arts do face a national growing national crisis, but there may be more to the story in the North East. Newcastle City Council wishes to place the blame solely on central Government - indeed are pleading with the public to do so - but the hard evidence of the contribution the arts make to our economy would not make them top candidates for a funding wipe-out.
Neighbouring Gateshead faces a similar financial challenge, but, according to leader Mick Henry, 'remains committed to the principle of subsidising the arts', recognizing how many different types of returns local communities get on this (relatively) tiny investment.