Finnish National Opera to decide on strategic recovery plan today

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According to information gathered by Helsingin Sanomat, the recovery programme to be submitted to the Board of the National Opera today does not include dismissals of staff. However, the Opera is bound to require dozens of reductions in the number of staff employed in the near future. To avoid compulsory redundancies, the Opera is considering other steps such as the use of natural wastage.
      Even extensive lay-offs are proposed to the Board in the recovery plan. The lay-off period would be timed to coincide with the planned renovation work in 2007, when the Opera House on Mannerheimintie will in any event be closed for four months, over the summer.
     
A decision on potential savings is to be made at today's Board meeting. It is possible that the Board will make some changes to the recovery plan proposed by the management of the Opera.
      The Board of the Opera has three members representing the staff, and as the staff oppose both lay-offs and dismissals, the forecast is that the Board meeting will be difficult and even stormy. The staff has sent a letter to the Board of the Opera reporting their own opinions on the difficulties as well as possible recovery methods.
     
According to preliminary information, the recovery proposal has been made by cutting costs evenly, across the board, while seeking to avoid compulsory redundancies.
      In 2005, the Opera employed 458 permanent employees and 136 temporary members of staff.
      In the future, the management of the Opera is to monitor the budgets of individual projects more closely.
     
The problems of the Finnish National Opera started last spring, when even those operas that were thought to be sure-fire hits did not pull in the sort of crowds that had been expected, and audience numbers were down across the board compared with the previous year. By the end of the year, the box-office receipts had dropped lower than ever before since the new Opera House has been open.
      Another reason for the problems was the overly generous budgeting after the splendid year of 2004, which had showed a year-end surplus of around EUR 250,000. By comparison, in 2005 almost all of the productions were seriously undersold.
      The Opera believed too much in the attraction of its productions, even though they did not include any guest appearances by major stars. For example, the performances of Leos Janácek's Katya Kabanova starring Karita Mattila were all shown to standing room-only audiences in 2004. The next year, the audience levels for the same opera dropped like a stone without her presence. Two other carry-over productions, Turandot and Der Rosenkavalier, also failed to draw anything like the same sort of audiences in 2005 as they had in 2004.
     
According to the Opera's Annual Report published today, the ticket revenues dropped below EUR six million from last year's 7.6 million. Moreover, the ticket sales were some EUR 2.1 million short of the budgeted figure. Even sponsor funds and rental revenues decreased.
      In January through February of the current year, the box-office receipts of the Opera were still some EUR 200,000 less than budgeted. However, March and April have sold better.
     
The Government has announced that no additional financial support will be granted, and this time, the Opera has to overcome its financial problems alone.
      The municipalities back the Opera to the tune of around EUR 4.3 million annually, while the state assistance is approximately EUR 35 million. The total budget of the Finnish National Opera is around EUR 44 million.
      The National Opera and the municipalities signed a financing agreement in 2003 that will run at least until 2008, and the state and the Opera have their own five-year deal that is in force and guaranteeing state support until 2009.
      Such lengthy funding arrangements were believed to allow for long-range planning of repertoires and budgets.


Previously in HS International Edition:
  Helsinki theatres enjoying box-office boom while opera suffers (18.4.2006)
  Board of National Opera to decide on cost-cutting measures this month (6.4.2006)

Helsingin Sanomat