Like Malcolm Douglas, I cant really follow Wee Little Drummer's point earlier, saying that the traditional folk music world should be supporting contemporary songwriting. They should surely not be competing for the same pot of money, they are quite different animals. The support for folk music has the same justification as making sure Ely cathedral doesnt fall down, trying to ensure farming practises keep the landscape in good heart, supporting vernacular architecture and other traditional arts/crafts. Everything will turn to dust and a distant memory if it doesnt get some support,from some people somehow; and in the case of music, an Arts Council grant is one of the established mechanisms to give this support and encouragemnet.
    Contemporary music is a different sort of thing, like the London Eye, Tesco's, or whatever. They too need support(if you happen to want them that is, I like the Eye, not so keen on Tesco's). Everything needs support, otherwise it falls down. But not from the same pot of money. You cant demand that CAMRA supports the manufacture of blue WKD vodka drinks, it's not their thing. It's the same wth people who like traditional music. If they happen to like contemporary music(most of them do), then they can support it as well. But there's no logical reason why they should have to. And,very emphatically, if someone in their infinite wisdom earmarks some money to support traditional folk arts, it should not be diverted into supporting the opposite.