With specific reference to the cultural policy set out by New Labour, this research explores the individual and social function of the arts and the extent to which they are agents of inclusion. The arts, an important aspect even driver of culture, can be perceived as exclusive with taste reflecting socio-economic concerns which contradicts this function. Such a paradox requires an investigation into the complex and sometimes contradictory relationship between cultural and social inclusion and exclusion, as well as the methods used of evaluating impact. The thesis is divided into four sections. Part One sets out definitions of social exclusion and relevant government cultural policy. Part Two investigates valuation methodology and techniques of evaluating the social impact of the arts programmes in particular. This includes an analysis of relevant reports. Part Three then investigates cultural exclusion. A trilateral approach is taken that assets at, cultural democracy and popular culture. Part Four relates specifically to causal factors of inclusion and how the arts enable emancipation, empowerment and satisfy personal need. It also explores the wider social function and ideal location of the arts, especially with regards to a leisure framework. Throughout, the research questions the extent to which the social role of the arts and policy is one of accommodation or more concerned with reflecting individual needs and a wider counterculture. It concludes that an engaged freedom is the more natural agenda of the arts, which contrasts with an instrumental New Labour government policy that treats social inclusion as primarily related to employment and training issues in order to increase individual social capital.