I was looking forward to Hedda Gabler at the Sheffield Crucible Theatre next season. Ibsen's off.

Off too, more in sorrow than in anger, is Mark Brickman, the artistic director responsible for two brilliant seasons. Artistically brilliant, I should say. Under Brickman the Crucible, opened in 1972 as the largest British provincial theatre, with a main house seating 1000 and a versatile studio, has begun to look like the National Theatre of the North.

Its projected deficit for next year was of NT proportions too - £250,000. Attendances have fallen from an average 70-75% in 1986-8 to 20-25% in 1991. What remedy? The Sheffield Theatres Board, made up of Councillors, academics and others but - apart from Brickman - no practitioners of theatre - met urgently and called for programme changes. The Board thought Brickman, who was party to the discussions, would make the changes himself: one rather than two major in-house productions, less lavish, maybe less serious, to preserve - in the words of Stephen Barry, Chief Executive of Sheffield Theatres

- 'the future artistic and financial health of the Crucible Theatre'. The Crucible has never been artistically healthier.

It's a question of finance, the question that hovers over all subsidized arts operations in Britain today. The culprit isn't Brickman, Barry, Arts Council or Board. The culprit here is bricks and mortar. Yet the Crucible crisis can be read as a more general parable, mutatis mutandis.

When I started attending the Crucible five years ago the Lyceum, across the way, looked derelict. Like the Sheffield Playhouse it was a casualty of the Crucible's success. This stately proscenium-arch theatre, Edwardian, comfortably bourgeois, had declined to a pop concert venue, then silence. Now, tastefully restored at a cost of £12 million and relaunched last year as a commercial venue for touring companies, the 1100-seat Lyceum wreaks revenge on the proud 1000-seat civic barn which is the Crucible, with its apron stage and dicey programmes of classics, new and foreign plays, and snooker.

The Lyceum gets the main tours which used to stop at the Crucible, and the income they generate. It gives something back - on the Christmas show about £50,000

- but it's hard to quantify what, apart from audiences, it's taken.

Great touring companies and productions visit the Lyceum regularly for short runs. The well-heeled citizenry pays two thirds again as much as they did at the Crucible to spend evenings with the stars. There's opera, ballet, but also a rich diet of 'all-star' theatre.

Sheffield, with a theatrically literate populace thanks to the Crucible, seems unable to sustain both houses. The Board and the Arts Council feared this, but decided it would be all right on the night. Then the recession put in a guest appearance. The problem is not confined to Sheffield (or to theatre).

An unprecendented number of first-rate tours and productions now circulates to commercial venues throughout the land. The Crucible crisis epitomizes a problem that afflicts - or will do - provincial reps in Nottingham, Liverpool, Manchester, Birmingham, Leeds and elsewhere. The survival of provincial theatre on a large scale, in dinosaur buildings of the visionary '60s and '70s, is not certain.

Can subsidized reps stand against the major touring venues, many of them hosting subsidized national companies? Can theatres that have shaped three generations of audiences, not by 'giving people what they want' but by giving them the best, theatres that belong to their communities, vie with the short-run all-stars on their doorsteps?

In Sheffield, unlike other cities, the Crucible and Lyceum are under one administrative umbrella, and the Crucible is getting wet. It has - or had - an artistic director. The Lyceum has an executive director. Both are administered by the Sheffield Theatres Board whose chief executive is the Lyceum's executive director, Stephen Barry. He insists on his commitment to the Crucible as an 'absolutely major theatre asset'. The 'new ideas' that the board is canvassing do not indicate a 'change of this fundamental policy'. The Board's decision was pragmatic: to see the Crucible, which survived eight years without deficit, emerge into the post-recession with a clean slate.

For him, the Crucible's recent plays have succeeded in artistic terms. But he allowed himself to wonder whether the programme was right. David Patmore, director of arts for Sheffield City, declared that arts managers must in future provide 'what the public needs and wants'. I asked Barry if what the public needs and what it wants might not be different things - especially what it needs from subsidized theatre. In Sheffield, this has become a philosophical rather than a practical question.

Sheffield invested heavily in the Lyceum (as, twenty years ago, it did in the Crucible). Civic pride dictates that it must make a profit. Having a local theatre of quality generating work of national standard seems to weigh less with the Board, despite Stephen Barry's emphatic. protestations. The Crucible provides the energy, stimulus and controversy of living theatre. Are the two objectives, different in kind, irreconcilable?

The Crucible main house is a big democratic space, without stalls, balconies, circles and boxes. Here elitism is a bad word; a series of committed directors has brought the best to the greatest number. The phantom of Jenny Lee inhabits the main house. It must not become another memorial to a vision of high culture as open to everyone.