Creative Scotland is considering halving the maximum award available from a fund for individual artists in response to the controversy over the explicit Rein project.

The agency carried out a “lessons learned” review after it withdrew funding for artist Leonie Rae Gasson’s project, saying it had breached its contractual obligations.

Creative Scotland pulled the funding in March after actors were being recruited to perform “non-simulated” sexual acts, with the arts body saying this was a significant departure from the funding application.

However, MSPs looking into the matter questioned whether Creative Scotland’s chiefs were being “open and transparent” around what they knew of the theatrical performance, which was always intended to have strong sexual content.

In May, freedom of information requests revealed the explicit contents of the original funding application, including nude actors as part of the 40-minute theatre installation.

READ MORE: Creative Scotland say key fund closing was 'unavoidable'

The arts body has now completed a review of the award, which was sent to MSPs on Holyrood’s Culture Committee.

It noted that the open fund for individuals has a maximum award of £100,000 – saying this is a “considerable level of risk to take with a single individual”.

The agency is now considering reducing this to £50,000.

However, the open fund is currently closed for new applications due to funding concerns, something which has sparked an uproar from many prominent musicians and figures in the culture sector.

The report also noted there was “a lack of adequate risk management” in the funding award, saying there should have been greater consideration of possible “reputational risk”.

A new clause on “damaging the reputation of Creative Scotland” is now being added to contracts with artists.

Staff at Creative Scotland are also being reminded of the need to clarify “unfamiliar terminology” – such as the phrase “non-simulated sex”.

The report said: “Creative Scotland understood that the Rein project would contain strong sexual themes when assessing the application for funding. However, funding was awarded on the basis that this was a theatrical performance, including all scenes with sexual content.

“On announcing the project and advertising for performers, the project departed from the approved application and advertised for performers to embark on real sex acts.

“Creative Scotland would not have awarded any funding had this information regarding real sex acts been expressly referenced in the application.”

The arts body said it moved “as swiftly as it could” once the information came to light and withdrew funding within four days.

Separately, Culture Secretary Angus Roberston was quizzed on the future of the Open Fund for Individuals by MSPs on Tuesday.

He said the Scottish Government is committed to increasing funding for culture and the arts, saying more updates would be coming “shortly”.

The minister said it is “disappointing” that Creative Scotland closed the fund before the Government took due diligence to release the funding.

In April, the artists behind the Rein project released a statement saying they disagreed with Creative Scotland’s version of events.

They said the project had been “misunderstood and misrepresented” and would have been “a new, immersive, three-screen, moving image, art installation fusing moving image, multi-sensory set design and dance in an erotic exploration of lesbian and queer sexuality set in the Scottish landscape”.

The artists said they “do not agree that they misled the funding body” but would not be speaking to the media or press.