British theatres are under attack from three directions – funding cuts, reduced audience spending and intense competition for philanthropy. This is particularly affecting new play development.

My own recent research, in the form of a survey sent out to theatres in response to comments made by culture minister Ed Vaizey (who claimed to me that the cuts were having no impact on the development of new plays), shows that nearly two-thirds of respondents have had to cancel or postpone one or more production since April 2012.

Two-fifths say new writing R&D spending had been reduced, and just over half say they are producing fewer new plays overall this year than last. Most blame a combination of reduced arts council investment, local authority cuts and the wider economic gloom affecting audiences’ ability to spend.

Yet this is against a backdrop of the Society of London Theatre releasing figures only last month that show that, in 2012, West End plays generated £88,297,949 in VAT for the Exchequer – a recession-defying third consecutive year of increases. Meanwhile, new British plays regularly clean up at New York’s prestigious Tony Awards (being nominated for or winning best play in seven of the past ten years alone).

Unfunded fringe theatres and the subsidised professional new writing theatres are locked into a mutual dependency which few outside the sector fully appreciate

Critics of state investment in theatre make the familiar charge that the West End is commercial, so its profits are not the same as saying that subsidised theatres make the nation money.

But one of the most compelling personal testimonies from my research was from West End producer Sonia Friedman, who said: “I don’t get subsidy. I don’t need it. But I do need the subsidised sector. That is where the talent finds its training. The best and most exciting writers, actors, designers and directors all cut their teeth in that environment and these are the same writers, actors, designers and directors we go on to routinely work with in the West End and on Broadway.”

She is right. One only needs to consider that One Man, Two Guvnors writer Richard Bean started at the Canal Cafe Theatre with a fringe piece called Of Rats And Men. And that the co-writer of the RSC’s hit musical Matilda and recent Channel 4 thriller Utopia, Dennis Kelly, started at Theatre 503 with a play called Debris. And Jerusalem’s Jez Butterworth started at the King’s Head and Etcetera theatres.

Aha, I hear you say. Those theatres aren’t subsidised. True – but because no one gets paid (or paid very little) then there is no limit to the size of the canvas they can offer their artists’ imaginations. As such, they are a vital showcase and stepping stone to the profession.

At a recent panel debate I chaired, literary managers from London’s Royal Court and Bush theatres described teams of talent scouts they regularly sent to fringe theatres across London. At the same event, the literary manager of unfunded Theatre 503 observed that because he wasn’t able to pay his readers, he ran the largest literary department there. He was also able to produce many of the plays passed over by the funded theatres because they were too expensive to produce (due to cast size, for instance).

Unfunded fringe theatres and the subsidised professional new writing theatres are locked into a mutual dependency which few outside the sector fully appreciate. But the net effect of both working together is to provide a ‘nursery’ for new talent development which feeds a huge swathe of British culture, from TV, film and radio to the West End, Broadway and many theatres across Europe.

The Off-West End label encompasses a highly diverse range of theatres. Their interconnectedness is a strength in times of plenty, but makes them vulnerable in times of drought – cut one theatre and you inevitably impoverish several more.

Bridging the gap between early fringe experience and a full-time, paid professional theatre career has always been hard, but now more so than ever. When times are tough, theatres contract around their main stages to protect their core work, and developmental schemes such as writers’ attachments, workshops and play readings are often the first to go. This might save money in the short term, but longer term it threatens to pull up the ladder for the next generation of talent.

At times like this we need inexpensive, high profile ways to celebrate and communicate our interconnectedness, creativity and profitability – especially to policymakers. But how? The Off-West End sector in London doesn’t have anything like the profile and identity of New York’s Off-Broadway.

The Offies awards sets out to redress that balance. Its long list this year includes subsidised powerhouses like Soho, Hampstead and the Almeida competing alongside unfunded fringe dynamos like Southwark Playhouse, The White Bear and the Union. This is just as it should be. It lays bare for all to see the full diversity and symbiosis between these theatres, and sets the scene for a leftfield hit to come out of nowhere and beat its subsidised cousins to an award in a blaze of glory.

In the grand scheme of things, it doesn’t cost a great deal – though the passion and hard work of the award’s organisers Sofie Mason and Diana Jervis-Read of www.offwestend.com shouldn’t be underestimated. It is, however, a valuable opportunity to show off what we do to those in power. Ed Vaizey is on the invite list, as is his Labour shadow Dan Jarvis. I’ll be presenting the most promising newcomer award to a fledgling playwright, and I really hope that both politicians turn up to join us in celebrating the emergence of an exciting new voice in inauspicious times.

When money is tight, we need to exploit other currencies too, to bridge the gaps for new talent to shine. We need adequate investment of course, and must continue to fight for its reinstatement once these current hard times are behind us. But in the meantime, kudos and column inches can launch a career too.

Fin Kennedy is an award-winning playwright. In Battalions, his report into the state of new theatre writing, will be launched at the ITC annual general meeting on February 22, and will subsequently be available for download from his blog.

The Off West End Theatre Awards will take place on Sunday February 29 at Battersea Arts Centre