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UK live industry says furlough replacement scheme falls short

Senior figures from within the live events industry have slated the winter support package announced by UK Chancellor Rishi Sunak yesterday (Thursday), claiming it fails to address the threat faced by the sector.

A series of measures aimed at assisting businesses through the winter have been unveiled, including a Job Support Scheme to top up the wages of employees working at least a third of their normal hours for the next six months, with employers paying 55 per cent of salary. The initiative will replace the furlough scheme, which comes to an end in October.

The new scheme will begin on November 1 and will cost the Government an estimated £300m, with the Chancellor assuring workers that a similar scheme would be available for the self-employed.

In addition, the five-per-cent rate on advance sales of tickets for events to be staged after January 12, 2021 has been extended until March 31. However, Music Venue Trust chief executive Mark Davyd said that the government is predicting that full capacity events will not take place until after this date, meaning the business will not be able to benefit to any significant degree.

He said: “Consumer confidence in purchasing tickets for events which may or may not take place, subject to local lockdowns or changes in national policy, simply does not exist. This is a tax cut extension on a product which the live music industry cannot yet sell.”

Davyd also noted that the furlough replacement scheme does not address the specific challenges faced by the live music industry.

“The new job support programme is built around the premise of returning to work, and employers returning to some level of income arising from that work to support those workers,” said Davyd.

“The government has made it clear that it does not believe that the time is right for the live music industry to return to work, and where limited events, under substantial restrictions, are permitted, the income generated is insufficient to meet any of the government targets for employer contributions. Bluntly, no part of the live music industry is in a position to pay 55% of its employees salaries in order to access the government support which is entirely conditional on doing that.”

Paul Reed, the chief executive of the Associations of Independent Festivals, agreed that many employers will not be in a position to pay 55 per cent of their employees’ salaries to access the support as the sector has not generated any income at all this year

While he welcomed the VAT cut extension, Reed noted that the measures are “not even a band aid for a sector that remains severely wounded.”

He said: “Festivals support 85,000 jobs in the UK and our most recent member surveys suggest redundancies of at least 50.5 per cent across the sector, some of which have unfortunately already taken place. This remains a broad-brush approach, and we urgently need targeted support.

“We are awaiting the outcome of Culture Recovery Fund applications on 5th October and this will determine if the independent festival sector will in fact receive the support that it urgently requires.”

Digital, Culture, Media and Sport (DCMS) committee chair Julian Knight, added: “We welcome this economy-wide intervention from the chancellor. However, it still leaves many hundreds of thousands of workers in events, arts and cultural parts of the economy with a grim future.

“The truth is, three times as many people in these sectors are currently on furlough than the national average, which suggests that the Job Support Scheme may not be able to stop unprecedented redundancies and many organisations from facing extinction.”

Elsewhere, Michael Kill, chief executive at Night Time Industries Association, said the new Jobs Support Scheme is throwing a “much-needed lifeline to hundreds of thousands of workers in the night-time economy,” but adds that more support will be needed.

He said: “We are seeking more clarity about what this announcement means for the majority of businesses in the night-time economy who do not know when, or if, they will be able to reopen their doors. These businesses cannot be allowed to collapse as the diversity and creativity of the UK’s night-time economy will die with them.

“We are also very concerned that the extension of business support loans will result in more painful debt for those already overburdened financially, many of whom are languishing in up to three-quarters of commercial rent debt with no certainty on when this will be due.

“More support will be needed. The majority of our sector is still unable to even open and trade. Night-time economy businesses have been unfairly targeted by the new 10 pm curfew, which we believe has no scientific basis and will prevent businesses from rebuilding the necessary revenue to stay afloat. The government must rethink this curfew and consider further sector-specific support for our industry if it wants to save Britain’s most loved cultural institutions.”

Marie Lindqvist, senior vice-president at ASM Global, called for help from the UK government on LinkedIn following the announcement. The executive said the sector needs to know what the winter looks like with support for short-term work, referring to the German government’s guarantee at the possibility of lay-offs throughout 2021.

She said: “Soon we’ll be going into October. It is still empty in the stands and we are still without a timetable and revenue. From December, we also do not know whether we can count on continued lay-off aid, so-called short-term work. From then on, the event industry risks facing 100-per-cent wage costs and continuing to ban the business.

“If the government is going to run the line now and help us save the jobs, we need to know now what winter looks like for us with support for short-term work. In Germany, the government has already guaranteed the possibility of lay-offs throughout 2021 unless the wheels start spinning again. Our long lead times for bookings mean that we now need to know what we can count on Q1 and Q2 2021. Help us get through this now and save jobs!”

Meanwhile, the WeMakeEvents campaign group, which has staged a series of demonstrations during the shutdown of live events to highlight the damage being done to the industry, has announced it will host another silent protest planned for Tuesday in front of Parliament.