Three's a Crowd at London's Royal Opera House

The Royal Opera House in Covent Garden, central London, is an untidy construction site. Metal scaffolding masks its elegant white-stucco faade. Cranes and concrete mixers clutter premises just yards from where, in the play "Pygmalion," Prof. Henry Higgins began teaching Eliza Doolittle how to speak "proper" English.

The home of the world-renowned Royal Opera (RO) and Royal Ballet (RB) is in the midst of a 213 million ($360 million) redevelopment program that will take two years to complete.

But the mess builders are creating in the British capital's former "fruit and veg" market is nothing compared with the political turmoil into which the two distinguished companies have suddenly been plunged.

Trouble began when Chris Smith, culture secretary in Britain's Labour government, elected six months ago, told #the RO and RB that in the future they would probably have to share the restored 2,000-seat Royal Opera House (ROH) with a third company - the English National Opera (ENO).

"If you do not agree," Mr. Smith said, "I cannot see how all three companies can avoid going bankrupt in the near future."

Mary Allen, the ROH's general manager, said Smith's comments were "a bolt from the blue." RB chairman Lord Sainsbury called the plan "pie in the sky." Lord Harewood, famous in past years for staging the Edinburgh Festival, called Smith's thinking "more visionary than practical," adding, "Three into one won't go."

Meanwhile, at London's Coliseum Theatre, current home of the ENO, which stages operas sung only in English and likes to call itself "the people's opera," music director Paul Daniel said sharing a building with the RO and RB would "threaten our company's unique work."

At the root of the furor is cash - or rather, the lack of it. Despite heavy government subsidies, the RO and #RB are together losing an estimated 7 million ($12 million) a year. The ENO is also in trouble, with an annual deficit of 2.5 million.

Few disagree that the output of the three companies reaches world-class standards, or that productions are well attended.

But while singers such as Luciano Pavarotti and dancers of the caliber of Darcey Bussell captivate audiences, the situation backstage is close to chaos.

Gerald Kaufman, chairman of the House of #Commons culture committee, on Oct. 31 described the administration of the ROH as "a shambles" and offered a warning: "This situation can't be allowed to continue."

Mr. Kaufman accuses the ROH management of lax financial controls. "It has been spending its annual state grant and other benefactions as though money was going out of style," he says. It has also depended too heavily on existing patrons and has "failed to sufficiently build up an alternative audience." The result, Kaufman asserts, has been "an unacceptable level of financial loss."

Opera and ballet, the world over, can seldom get by without financial help either from government, big business, or private donors. The ROH and ENO have been suffering from shrinkage of funds from all three sources.

Their biggest# problem has been a decision by the government-funded Arts Council, which disburses cash to a wide range of cultural activities, to reduce its annual subsidies.

For the past five years the council has pegged the ROH grant at 14.5 million - about one-third of its income. It also froze grants to the ENO.

This has put pressure on the companies to raise seat prices. The most costly RO seat, for example, is about 200 ($340), compared with $210 at the Metropolitan Opera in New York and $250 at Milan's La Scala.

Despite these measures, all three London companies have found it impossible to make ends meet. In a period of economic recession, attendance at the RO and RB fell from well over 90 percent to 85 percent. Hence the pileup of debt, which Smith says has forced his hand.

But the culture secretary has been careful to say that he is not actually ordering the companies to do what he wants. He has appointed Sir Richard Eyre, former artistic director of the Royal National Theatre, to head an inquiry into what Smith calls the "feasibility" of the three companies operating under one roof.

While Sir Richard investigates, on the surface little will change.

Both the RO and RB, deprived of their usual premises for two years, are moving from theater to theater and city to city. So far this season their peripatetic programming has lost them more than 1 million.

At the ENO, Mr. Daniel is promising "dynamic and innovative" productions but concedes his company is "hard up."

In 1999, the scaffolding will be removed from the ROH. Meanwhile, there have been reports that the ROH has been offered 15 million by unnamed private benefactors to tide it over the next two years.

None of this impresses some critics. In a scathing report published on Nov. 8, The Economist magazine accused the ROH of having "messed up big time" and suggested, "Bankruptcy has something to be said for it."

Others are comparing the row to the antics of opera singer#s. "There has not been a show like it since Maria Callas and Renata Tebaldi bared teeth at one another across a La Scala rehearsal room," says Norman Lebrecht, music critic of London's Daily Telegraph. "This one's going to run and run."