There's no doubt that lack of funding won't help, but in itself it doesn't explain lowering of visitor numbers. I guess you'd rea?ly need to get down into the detail.
The big city museum will always account for the huge bulk of the numbers. They are more likely to be affected by foreign tourism habits, the threat of terrorism and the particular exhibitions that are on. I love the BM and NHM in particular, but the cost of trains into London make trips prohibitively expensive so we only tend to go to see particular exhibitions ( which are usually ticketed even if the museum itself is free). My own income has steadily dropped in real terms since 2010, so these trips are now a luxury and have to be weighed against other stuff. If I lived in London I'd go much more just to wander the galleries. We went to Birmingham and Edinburgh museums in October and both are amazing.
The smaller more rural museums have a harder job because there's no passing tourist audience in significant numbers, especially foreign tourists. They have more limited exhibits, although sharing and touring from other museums will help (eg the Dippy tour this year). But as in the cities, everyone is getting poorer. The smaller museums are harder put to sustain free admission because there's no cafe or giftshop to recoup the costs like in say NHM. And there's less ability to stage high tech interactive exhibits that maybe everyone wants or expects now. It's very sad but in the current economic climate it's unlikely to improve.
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