As a lass living in Yorkshire, Dame Diana Rigg had no problems getting a discretionary award from her local council to train at the Royal Academy of Dramatic Arts. Now she might not be so fortunate.

According to a survey published this week by the Gulbenkian Foundation, and undertaken by the National Foundation for Educational Research, 28 per cent of all local education authorities have a policy of no support to students of dance and drama.

The number of students receiving such awards has fallen by 12 per cent in the past year, and spending on awards has dropped 13 per cent.

Such a trend would lead to a "cultural desert", said Dame Diana, who was accompanied by a galaxy of stars at the report's press launch. "Our income from the arts is huge in England," she said. "It will diminish and our stature will similarly diminish. In 40 years time, those who inherit that desert will say 'How could they possibly let that happen'?" Other names from the world of dance and drama were similarly exercised.

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Choreographer Richard Alston said he was distraught at the waste of talent. The former ballerina Dame Beryl Grey said this was an area that needed fighting for. And the actress Patricia Hodge wondered why a student could get a grant to study civil engineering but not to be a ballet dancer or actor. Why could not everyone receive awards to study whatever they wanted? she asked. Her colleagues applauded loudly.

The stars had turned out in force at the ICA in London, including the actors Susannah York, Juliet Stephenson, Maureen Lipman, Tim Piggott-Smith and Clive Swift. The only heart-throb who failed to show up was Jeremy Irons.

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John Bevan, chairman of the project steering group and former chief of the polytechnics funding body, said there had to be a long-term solution. But in the interim, lottery money should be tapped, he added.

Discretionary Awards in Dance and Drama, by Caroline Sharp and Lesley Kendall, NFER, Pounds 4.