The report for the Opera and Music Theatre Forum shows that the audience for opera in Britain increased by a quarter between 1986 and 2000. But the Forum, which represents most small and medium-sized companies, says the potential for growth is limited by a lack of new operas to perform, a shortage of productions and the poverty of dozens of small opera companies.

Speaking to BBC News Online, the organisations said the problem facing grassroots opera was one of administration and finding the works to perform, rather than finding audiences. Caroline Anderson, manager of the Forum, said audiences were growing for new and experimental works and not just for standard repertoire. "Promoters want more of it - but supply has been affected by years of under-funding."

The report found that the seven largest opera houses had yearly incomes of more tha £1m each, but most small and medium-sized companies relied on volunteers and administrators taking on several jobs at once. Money was needed for basic things like getting bookings and writing contracts. Promoters wanted rarer and more experimental operas but small companies could not afford to take the risk.