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Building on the work of the Future Libraries programme this £200,000 fund will support around 10 projects for one year, from March 2012 until March 2013, with a maximum award of £20,000 per project.

Successful projects will need to explore how embedding arts and culture in libraries can bring benefits to library users and library services and increase cultural provision in local areas.  Projects will also look at new ways of working that will enhance libraries' sustainability and relevance as vibrant hubs in their local communities.

Alan Davey, Chief Executive of Arts Council England, said "Libraries should be at the very heart of our society where they are valued by local communities as a shared and trusted space for culture, information and learning. We have designed this initiative to draw on the existing strengths of libraries, but also to enable them to think creatively about new ways of delivering and developing their services."

Cllr Chris White, Chair of the LGA's Culture, Tourism and Sport Board, said, "A library in the 21st century can be part of a cultural hub which supports everything from education and lifelong learning to health, volunteering, art projects, job hunting and social care. The Libraries Development Initiative is a great way to build on the innovative ideas put forward as part of the Future Libraries Programme. We need to ensure all the enthusiasm and creativity council staff have to transform their libraries becomes a reality."

The first stage of the initiative is for an organisation, or a consortium, to complete an expression of interest form that explores one of the designated parts of the initiative. These are:

Part 1: new delivery models for arts and culture working together. This will look at new ways that libraries can work with arts and cultural organisations, with the aim of improving a community's experience and its opportunities for engaging with arts and culture locally.

Part 2: coordinating partnerships to achieve wider community outcomes. This will explore how libraries can expand their already established role in the local delivery of a wide range of national policy areas such as learning, skills and employability and health, through multi-disciplinary partnerships with, for example, other local authority departments, community groups, job centres and arts and cultural organisations.

Part 3: books and reading. This will explore the challenge for libraries to ensure their books and reading offer remains engaging, relevant and exciting in the changing context of more active library user involvement and the different ways people access reading material.

Part 4: commercial partnerships. This will consider how libraries can respond to increasing economic challenges in an innovative way, exploring diverse funding streams and the benefits of a resilient mixed economy.

Shortlisted applicants will be invited to complete a full application, and will be contacted by 12 December 2011. Final applications will be submitted by 20 January 2012, with the successful projects announced on 13 February 2012.

More information on the initiative, including how to express interest, can be found on the Arts Council website.