"Excellence will be rewarded," she said. "We plan to increase funding for the companies which qualify beyond the level currently made available through the Scottish Arts Council."

The announcement was a response to the findings of a commission headed by former arts council chair James Boyle, which recommended in June 2005 that arts funding be increased by Ô£100 million and that new agencies overseeing culture be created.

The Arts Council was widely criticized for its role in the collapse of Scottish Opera, which shut down for the entire 2005-06 season because of financial problems.

The plan announced by Ferguson included the creation of a new agency, Creative Scotland, which will absorb the Arts Council and Scottish Screen, which promotes movie-making in the country. She also proposed a policy of "cultural rights" for Scottish citizens. The new policy might lead to citizens getting free admission to performances, more information about culture, or the chance to participate in community art projects.