There has been a longstanding concern about the relationships between policy, funding and theatre practice in educational and community settings. Past scholarship has made evident the varied ways a relationship with policy can manifest and play out in the political, pedagogic, aesthetic and ethical values, approaches and outcomes of applied theatre practices. This includes the ways theatre can play a part in producing the problems it intends to address. This article argues for the use of critical theories to interrogate and rethink the policy-funding-practice relationship, to generate nuanced understandings and open up a space of possibility.