Arts Council England (ACE) has announced that it plans to invest an additional £44.5m in arts initiatives across the country over the next two years in a bid to fight off the effects of the economic downturn.

The new funding proposals were unveiled by chair Dame Liz Forgan on 24 April at an ACE-sponsored seminar investigating ways in which the importance of arts and culture can be maximised during the recession. A new £40m open application fund – Sustain – will be established in order to support arts organisations that are suffering as a result of the downturn, while £500,000 will be made available for the Town Centres Initiative to allow more artistic activities to take place in empty retail areas.

Grants for the arts budget will also increase by £4m over the next two years as part of the new funding strategy, although Forgan has called upon private and public sector partners to maintain current levels of investment in order to ensure that artists are seen as a solution to the downturn. Forgan said: "Of course we understand that the national debt has to be tackled, but a few million off the arts budget is going to make no appreciable difference to that task. On the other hand it could undermine years of creative and financial investment.

"The Arts Council will do all it can to keep that investment in place. We cannot protect artists from the realities of recession, but we can be as imaginative, open and useful as possible in our efforts to get us all through this with minimal damage to the creative life of this country."