The Arts Council provided over €1.4 million to Siamsa Tíre since 2020.
It says extra funding was given to the National Folk Theatre in 2020 and 2021, in addition to its annual funding allocation.
At the beginning of June, Siamsa Tíre announced it was suspending all non-profit-making productions for the summer season.
Its board and management cited COVID-19, challenges facing the tourism market and rising energy prices for the decision.
The Arts Council says in 2020 and 2021, funding totalling €220,000 was provided to Siamsa Tíre to assist with the losses incurred as a result of COVID-19.
This funding was in addition to the annual grant of €316,000 which was provided to the National Folk Theatre in each year.
Last year, the Arts Council stated it provided funding of €587,000 given the deteriorating financial situation of the company.
It states this was provided with the proviso that such additional funding would not be provided this year, and that the financial structure of the company needed to be addressed given the underlying long-term reduction in box-office from tourism.
This year, the Arts Council says it made a budget allocation in line with previous years on the understanding that the company addressed its unsustainable financial structure.
It says this was made conditional on the company providing a financial plan demonstrating its viability to the end of this year. It says this plan has now been submitted and drawdown of allocated funding may proceed.
The Arts Council says it trusts the board of Siamsa will find a way of stabilising the organisation and planning a way forward that protects the unique and valuable contribution the National Folk Theatre makes to the arts both nationally and locally.
