The pressures of Thatcherism on theatre funding in the 'eighties were severe, but the early harshness was tempered by several factors. One was the positive influence of the Cork Report, particularly on touring and experimental theatre. Another, the authors believe, was a careful strategy of reallocation of funding to support creativity in English theatre, notably through the touring franchise scheme. Here, they analyze in detail the ways in which the English Arts Council operated the scheme in an attempt to revitalize aspects of English theatre from 1986 onwards, trace the change in the values of ‘political’ theatre over that period, and critically examine some received ideas in the light of the available evidence. Ian Brown is Dean of Arts and Professor of Theatre at Queen Margaret University College, Edinburgh, Rob Brannen is a Senior Lecturer in Drama at De Montfort University, Bedford. Douglas Brown is Assistant Director, Scottish Centre for Cultural Management and Policy, at Queen Margaret University College, Edinburgh.