Arts Minister George Brandis has defended moves to block government funding for organisations that unreasonably refuse corporate sponsorship following the "preposterously unreasonable" termination of Transfield's sponsorship of the Sydney Biennale.
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Senator Brandis also indicated that any ''commercially sound'' company, including tobacco companies, should not be ruled out for arts sponsorship.
Senator Brandis has written to the Australia Council asking it to develop a policy that would deny funding to events or artists that refuse private sponsorship after the Biennale board severed ties with Transfield over its involvement in processing asylum seekers offshore.
Senator Brandis said on Friday that while it was reasonable for arts companies or festivals to reject corporate funding if they had concerns about a sponsor's financial credentials, it was not reasonable for them to refuse sponsorship on political grounds.
In response to a question about whether it was appropriate for an organisation to refuse sponsorship from a tobacco company on political grounds, Senator Brandis told Radio National: ''I don't think that arts companies should reject bona fide sponsorship from commercially sound, prospective partners on political grounds – I don't.
''And I think that's the error into which the board of the Sydney Biennale fell on this occasion.''
Anti-smoking organisation Quit said tobacco sponsorship or donations was legal as long as the organisation or festival was not promoting or advertising the tobacco company. The Labor and Liberal parties do not take donations from tobacco companies, but the Nationals still accept money from these companies.
Senator Brandis said it was "fine for artists to make political statements" but the views expressed on this occasion were "irrational" and the Biennale board had capitulated "to the blackmail effectively of a small number of artists".
He defended his decision to write to the Australia Council and said he was "merely asking them to develop a policy to deal with circumstances such as this".
"What we can't have in this country is a culture in which arts companies and arts administrators are not encouraging private philanthropy," Senator Brandis said.
"The heart and soul of good arts funding policy is to look to explore every avenue to encourage private philanthropy."
In a Facebook post on Thursday night, the opposition's finance spokesman Tony Burke wrote that he had highlighted during the 2013 election campaign that "George Brandis believed in ministerial intervention".
"Brandis accused me of lying," the post says.
On Friday Mr Burke reiterated his Facebook post, telling Fairfax Media: "When I predicted that only Labor would deliver an independent Australia Council and that George Brandis would try to intervene, he accused me of lying.
"We're now seeing the start of what intervention looks like."
