Only a decade ago, the Serpentine Gallery was in crisis. The new director, Julia Peyton-Jones, had begun raising funds for the urgently needed renovation of an old building with a leaky roof. But she suddenly found herself under attack from Iain Sproat, a malevolent junior minister at the Department of National Heritage. He declared that the Serpentine's rent-free existence was over. Now, announced Sproat, it must pay an annual levy of £60,000, rocketing to £90,000 in five years' time. If no money was forthcoming from the gallery, he suggested, it should be razed to the ground and horse-riding facilities be put in instead.
Sproat, however, was reckoning without the courageous resolve of the woman he had threatened so disdainfully. Ten years later, the machinating minister has been forgotten. But Peyton-Jones is thriving, along with the gallery she has turned into a powerhouse for contemporary art at its most compelling. After raising £4m, the Serpentine was transformed by John Miller and Partners into a cool, bleached sequence of luminous chambers. The renovated rooms retain delectable views of Kensington Gardens and Hyde Park, and also enable us to focus with great clarity on the works displayed there.
Built in 1934 to serve as a genteel teahouse in the royal park, the Serpentine enjoys by far and away the most seductive setting of any gallery in London. But ever since it first became a showcase for art, back in 1970, this beguiling locale has been a challenge as well as a blessing. For it exists in absolute isolation. Most galleries, now, are clustered either in the posh West or trendy East Ends of the metropolis. They benefit from their proximity to each other and from passing trade, whereas gallery-goers must always make a special trip to visit the Serpentine. So its director has to ensure that they want to go there. And Peyton-Jones, passionately committed to a no-entry-charge policy that attracts 400,000 visitors annually, has succeeded in making her gallery an essential venue for anyone who wants to take the pulse of modern art.
When the Serpentine reopened in 1998, the inaugural show was devoted to the pioneering conceptualist, Piero Manzoni. Although he died young, 35 years earlier, his open-ended inventiveness is absolutely in tune with many young artists. Whenever Peyton-Jones stages historical shows such as the Manzoni retrospective, they turn out to be strikingly fresh and relevant to present-day concerns. Having studied painting herself at the Royal College of Art in the late 1970s, she has always been open to adventurous new developments. Along with her excellent deputies - Andrea Schlieker, Lisa Corrin and now Rochelle Steiner - she has consistently managed to highlight some of the most outstanding artists from the emerging generation.
In 1994 the young Damien Hirst was even given carte blanche to select his own international show at the Serpentine. Calling it "Some Went Mad, Some Ran Away", he included his own dead lamb suspended in milky green formaldehyde. One enraged visitor vandalised Hirst's exhibit by discolouring it with ink. But Peyton-Jones was undismayed. If she believes in a work, no amount of vituperative flak will make this notably determined individual change her mind. A year later, the Serpentine once again became the focus of outrage when the actress Tilda Swinton slept for weeks in glass box made by Cornelia Parker. Art and life here came into uncanny collision, and yet the outcome was surprisingly serene.
Peyton-Jones relishes risk-taking, never more dramatically than when Richard Wilson was let loose on the old gallery just before it closed for renovation. Celebrated for his oceanic expanse of sump oil flooding the Saatchi Gallery, he installed in the Serpentine a tomato-red fork-lift truck, from which a cabin was lowered into a colossal cavity gouged out of the gallery floor. Not content with helping Wilson demolish her gallery, Peyton-Jones then let Tadashi Kawamata gather up all the discarded materials he could scavenge from the site. The great structure of shattered timbers he erected in front of the Serpentine took on the melancholy grandeur of a ruined medieval abbey. And these works may, in turn, have inspired Peyton-Jones to think about commissioning architects to design special pavilions for the same location.
It was not easy to obtain permission for this visionary scheme. The royal parks are protected with notorious zeal from anything that could be described as intrusion, and many long-established residents of Kensington are quick to protest about innovations that threaten to disrupt their sylvan idyll. So when Peyton-Jones asked Zaha Hadid to design the first pavilion in the year 2000, it was allowed to stand there for only a very short time. At the last minute, Chris Smith, who was then arts minister, granted it an extended life, so impressed was he by Hadid's audacious building. Encouraged, Peyton-Jones went on to invite other, equally impressive architects who, like Hadid, had never before completed a building in Britain.
Daniel Libeskind (with Arup) and Toyo Ito both created outstanding pavilions, in 2001 and 2002, respectively. The whole project amounted to an admirably imaginative way for an art gallery to explore architecture. Rather than mounting a conventional architectural show inside the Serpentine, with photographs, models and too many explanatory captions, Peyton-Jones has persuaded several of today's leading practitioners to create an original building. All three previous pavilions were so enticing that they found buyers after their three-month exposure in Kensington Gardens. But the problems involved each time, obtaining planning permission, health and safety approval and sponsorship, remain formidable for the director and her small team.
When the Serpentine first opened, it was funded entirely by the state. Now, the Arts Council's grant amounts to only 27 per cent of the gallery's annual expenditure. For the rest, Peyton-Jones must rely on corporate sponsors and her council, a group that generously gives the Serpentine £500,000 each year. The council is hosting a typically glamorous fundraising summer party on 2 July in the irresistible new pavilion - designed by the legendary Brazilian architect Oscar Niemeyer. Long hailed as a titan of modernist architecture whose most spectacular work stamped his country's new capital city, Brasilia, with its bravura identity, Niemeyer is now 95. But Peyton-Jones flew over to his office in Rio de Janeiro several times, sat at his work table, where he still draws incessantly, and persuaded him to take on the pavilion commission.
The outcome is a triumph of billowing, floating vivacity. Visitors ascend to the first-floor room along a trademark ramp emblazoned with a ruby-red floor. Above them, a buoyant canopy curves and dips like a voluptuous female nude reclining on Copacabana Beach. Niemeyer, who can see the beach from his office eyrie, has never made any secret of his preoccupation with "the figure of a woman", and she reappears in the languorous lines of a Matissean mural he has designed for a large interior wall. A relaxed, simplified and supremely assured building, the pavilion shows how Niemeyer's love affair with sensuous curves informs everything he has produced during his long, hugely prolific career.
Julia Peyton-Jones, awarded an OBE in the Queen's Birthday Honours list earlier this month, deserves to be applauded for her chutzpah in securing such a zestful and seductive little masterpiece. An urgent campaign should be mounted to ensure that this pavilion, far from being sold to the highest bidder, is acquired by the nation and given a permanent parkland site. It deserves to be cherished as much as Peyton-Jones, who has transformed her gallery into a continual, and marvellously unpredictable, delight.
The Serpentine Gallery Pavilion 2003, designed by Oscar Niemeyer, is at Kensington Gardens, London W2 (for more information call the gallery on: 020 7402 6075)
Richard Cork's four new books on modern art (1970-2000) are published this month by Yale