• Since the COVID-19 pandemic, museums and galleries have managed rising costs and found ways to increase self-generated income through a range of innovative and commercially-minded strategies
  • These institutions continue to face challenges, such as becoming more reliant on self-generated income, so they will need to prioritise good financial management and planning.
  • DCMS must ensure it has the structures in place to identify early warning signs should museums and galleries start struggling to manage their financial risks, so it can intervene.

The 15 museums and galleries1 sponsored by the Department for Culture, Media & Sport (DCMS) increased their total self-generated income by 53% in real terms from 2021-22 to 2024-25, to £563 million,2 reaching the level achieved before the pandemic despite lower visitor numbers, according to a new National Audit Office (NAO) report.

Between 2019 and 2024, the DCMS-sponsored museums and galleries included seven of the top 10 most visited free visitor attractions in England. These institutions are nationally and internationally significant, contributing to the UK’s influence overseas, through international loans from their collections, touring and promoting exhibitions internationally, and research projects.

Since re-opening after the pandemic, the museums’ and galleries’ costs have increased by 18% in real terms from 2021-22 to 2024-25 as visitor numbers were still recovering.3

The museums and galleries have found ways to boost self-generated income through a range of innovative and commercially minded approaches, such as venue hire, donations and membership schemes, paid-for visitor experiences, hospitality and retail.

They have also drawn on their financial reserves and have sought to contain costs through approaches such as reducing staff expenditure: for example by making redundancies, not filling vacancies, having fewer staff on duty and retraining staff in both security and museum guide duties.

But these measures come with risks. Self-generated income sources are riskier– for example, ‘blockbuster’ exhibition income is volatile – while cost containment measures may impact museums and galleries’ ability to preserve their collections and maintain free access.4 Some institutions may also lack the financial management capacity to manage future risks.5

There are indications that the museums’ and galleries’ overall financial position had worsened by early 2025, with some requiring additional funding from DCMS to continue operating.6

DCMS improved its approach to providing museums’ and galleries’ funding in 2025-26, by taking account of changes in their financial position, a process it plans to repeat periodically in the future.

DCMS is reviewing how it tracks museums’ and galleries’ performance, as there are some objectives for which it does not have key performance indicators, and is working to improve its oversight arrangements so that it has a clearer measure of each museum and gallery’s financial resilience.

To address potential future financial challenges, the NAO recommends that DCMS should:

  • Identify a set of indicators of museums’ and galleries’ financial resilience to identify potential early warning signs of financial difficulty
  • Communicate to the M&Gs the factors it considers when deciding their annual funding allocations
  • Communicate a plan setting out how it will support sharing of good practice

The NAO also recommends that museums and galleries should:

  • Take the opportunity provided by the current multi-year Spending Review period to establish financial plans that reflect the greater certainty over government funding
  • Agree collectively how they can consistently capture data on key costs to facilitate more insightful comparisons between institutions
  • review whether their financial management capability is sufficient to manage future risks and seek to address any gaps they identify

"DCMS-sponsored museums and galleries are working hard to build their own sources of funding. They will need to continue to develop their financial management capability to maintain this momentum and withstand future shocks."

Gareth Davies, head of the NAO

Read the full report

The financial resilience of DCMS-sponsored museums and galleries

Notes for editors

  1. British Museum; Museum of the Home; Horniman Museum; Imperial War Museums; National Gallery; National Museums Liverpool; National Portrait Gallery; Natural History Museum; Royal Armouries; Royal Museums Greenwich; Science Museum Group; Sir John Soane’s Museum; Tate Gallery Group; Victoria and Albert Museum; The Wallace Collection
  2. Total self-generated income excludes the value of donated assets, as their size can vary significantly from year to year.
  3. The increase in museums and galleries costs since 2021-22 has been driven, in part, by higher staff costs following increases in staff pay and staff numbers after lay-offs during the pandemic. Museums and galleries have also experienced increased operating costs, such as for maintenance and energy. Although total visitor numbers have recovered significantly, in 2024-25 they were 13% below the annual pre-pandemic average, at 42 million compared to 48 million.
  4. One-third of museums and galleries told NAO they were concerned about their ability to deliver these core objectives over the next three years, with 20% looking at their service offer to control costs.
  5. Some museums and galleries have small finance teams, while many have experienced significant churn in their senior financial leadership in recent years. Some have also struggled to produce their annual accounts for audit on a timely basis. In some cases, DCMS has provided additional support to museum and gallery finance teams.
  6. Over half of the museum and galleries (53%) reported to the NAO that they were facing a worse financial position in August 2025 than three years ago, while five (33%) said they were in a better position. All but one of these five had higher visitor numbers in 2024-25 than before the COVID-19 pandemic. DCMS increased funding to museums and galleries for 2025-26 by £31 million. This included £24.8 million to provide all museums and galleries in February 2025 with a minimum 5% increase in their funding, with additional support for six museums and galleries in the most financial difficulty.

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