By Finlo Rohrer BBC News Online entertainment staff

The UK's four Tate galleries have had an eventful couple of years with blockbusting exhibitions, but budgetary constraints are starting to hurt.

There has been a large drop in overall numbers at the end of a period of upheaval, dominated by the arrival of Tate Modern and the refurbishment of Tate Britain, both in London and two of the UK's flagship art galleries.

Figures for attendance fell from 6.7 million for the year up to March 2001 to 5.5 million for the following year.

Almost on a daily basis major works are offered to us that we cannot contemplate Nicholas Serota Tate director

The trust attributes the fall to the Tate Modern massively exceeding its target figures after its opening in May 2000, and then stabilising to a more realistic level.

With 5.25 million people visiting the gallery in its first year, a drop to 3.6 million the following year seriously impacted on figures for the Tate as a whole.

But the London galleries have scored massive successes, the older Tate Britain with its summer Lucian Freud exhibition and Tate Modern with its record-breaking Matisse-Picasso show.

The Freud retrospective attracted almost 200,000 visitors over a "rather wonderful summer", but was eclipsed by the modernist-impressionist axis at its new sister gallery in London's Bankside.

Economic difficulties

More than 500,000 people attended Matisse-Picasso, with Tate Modern opening for a 36-hour marathon at the end of its run.

On the financial front, the trust is braced for potential economic difficulties with the post-11 September financial climate meaning corporate sponsors have to be cultivated more assiduously than ever.

The main squeeze is in acquisitions, where lack of funds has caused the Tate to miss out on a number of major works.

Max Beckmann's profile will be raised

Its grant for buying art has fallen from �6.4m in 2000-2001 to �4.9m in 2001-2002.

The art market fluctuates in times of economic hardship, but the prices of "big ticket" items remain buoyant, and the Tate cannot compete with collectors, corporations, and even other galleries.

Tate director Nicholas Serota admits: "Almost on a daily basis major works are offered to us that we cannot contemplate.

"There is an expectation on the part of the public that they will see senior British artists."

Programmes threat

Prominent among the recent purchases are the Tate's first major works by Jackson Pollock-contemporary Cy Twombly.

But the future is likely to be filled more with collaborations with other galleries than spectacular purchases.

Recognising its funds for acquisitions may not improve, the galleries are continuing to look at joint purchases with other museums and sponsorship options.

There are other financial difficulties as well - management have admitted that the Tate was only kept out of the red by Matisse-Picasso.

We try to seek a balance between those [shows] that will be very heavily frequented and those that will appeal to a narrow audience Nicholas Serota

Income has dropped from �85.7m to �81.4m, with operating budgets rising and budgets for capital expenditure falling.

There could be a shortfall of �1.5m in the budget by 2003-2004, meanng programmes could have to be cut.

But Mr Serota thinks it will be "surprising" if, despite recent budget increases at the Department for Culture, Media and Sport (DCMS), they do not step in to make up the difference in grant-in-aid.

He insists there is no pressure to produce a string of "blockbuster" exhibitions because of financial need.

Popular shows

"We will regularly present the major figures of the 20th Century.

"They are not done for financial reasons. We try to seek a balance between those that will be very heavily frequented and those that will appeal to a narrow audience."

Anyone glancing over the exhibitions due for 2003 will notice while there are plenty of popular -looking shows, there is nothing of the magnitude of Matisse-Picasso.

Self-Portrait is back on display

Max Beckmann's eerie and often downright weird paintings may not be immediately familiar to all gallery-goers, but next year's Tate Modern show is likely to be one of London's hot tickets.

That said, one of Tate Britain's highlights for 2002-2003 is Constable-Delacroix, two old favourites counterbalanced by exhibitions of contemporary British artists and the work of veteran painter Bridget Riley.

Famous Turners

For Tate Britain, 2002-2003 will represent a return to the core of its collection, the massive Turner Bequest, after the return of a number of major works on loan.

And next autumn will see Turner and Venice, featuring his vision of the city that fascinated so many artists, as well as work by influences such as Canaletto.

And for those who cannot get enough Turner, the artist's gallery has been recreated on the internet to go along with the digitised collection of his paintings.

Perhaps the brightest prospect on the horizon is the Turner-Whistler-Monet exhibition, currently in the early stages of planning with galleries in Canada and France for a 2005 slot.