We are going to appeal and I cannot believe that we are not going to win that appeal

Jenny Stephens, artistic director Swan Theatre

But Jenny Stephens, artistic director at the Swan, was told her theatre would receive no extra money during rehearsals for four new plays to be staged at venue.

She said: "Naturally, we are frustrated and bewildered. We feel the message of what we are doing is not getting across.

"We produce fantastic, innovative and ground-breaking work. But no-one in London is getting the message."

Appeal

She is frustrated that the West Midlands Arts Board did not consult the theatre when drawing up its bid for extra funding from the Arts Council.

"We are going to appeal and I cannot believe that we are not going to win that appeal."

Funding levels for the theatre have been frozen but the Swan is in no danger of closing.

"We are one of the most badly funded theatres in Britain and this decision means we cannot realise our ambitions."

'Fantastic'

She added: "It is fantastic that some theatres are getting this up lift and I have to take my hat off to [Culture Secretary] Chris Smith.

"But the funding system does not seem to be able to recognise where good work is going on."

The Oxford Playhouse is proof positive that regional theatre is alive and kicking

Tish Francis, Oxford Playhouse

She said that all the theatres that failed to get extra funding "are in similar locations, serving a similar audience".

"There is clearly a preference that new work should be created in bigger conurbations and shipped out here," she said.

A few hundred miles away at the Oxford Playhouse, artistic director Tish Francis has to work out how to spend an extra �201,000, which represents a 400% funding rise.

'Wonderful'

She said: "It's wonderful news for The Oxford Playhouse and the region and a real validation of the support we've received from our artists and audiences.

"The Oxford Playhouse is proof positive that regional theatre is alive and kicking."

The money, she said would be used to help make "great theatre for our audiences" and to "make some inroads towards addressing the chronic low pay that affects so much of the industry".