92% of independent festivals in the UK are at risk without government support.
A new report by the Association of Independent Festivals (AIF) has warned that the majority of independent festivals in the UK are at risk of collapse without government intervention. According to the report, independent festivals in the UK are losing an average of £375,000 in “sunk costs” for non-recoupable expenses such as marketing and staffing, with 92% of AIF members at risk without government intervention.
The report goes on to state that 98.5% of AIF members, which include End of the Road, Field Day and Meltdown, aren’t covered by insurance that protects against cancellation due to coronavirus. Predicting that at least 90% of UK festivals won’t take place this year, the AIF reports that the festival sector at large is facing potential refunds of £800 million.
As well as facing risks to due to lack of insurance, the majority of AIF members don’t qualify for existing government schemes to help businesses and staff during lockdown. At the time of publication, no AIF members have been able to successfully access the Coronavirus Business Interruption Loans Scheme.
In a statement accompanying the report AIF CEO Paul Reed said: “While the Government has been receptive to AIF’s counsel, it has not taken meaningful action to protect our sector. Single event festival companies are seasonal businesses. They need urgent support now and ongoing support after lockdown ends and restrictions are eased. This is not a temporary shutdown of business – it is an entire year of income and trade wiped out. If support is not offered throughout the autumn, then the sector will face widespread job losses that will seriously inhibit its ability to deliver events in 2021.
“There is no safety net for independent festivals, many of which have fallen between the cracks of current government support measures such as loans and grants. For example, zero percent of AIF members have been able to successfully access the Coronavirus Business Interruption Loans Scheme.
“UK festivals are not only an intrinsic, defining part of British culture but also an economic powerhouse that generates hundreds of millions for the economy – we urge government to recognise them as such.”
In order to prevent the collapse of the independent festival sector in the UK, the AIF has made a number of recommendations to government including the continuation of all original employment (furloughing and self-employed schemes) and business support packages until the festival industry can get to the planning and sales stage of 2021 events and VAT breaks on ticket sales for a minimum of 18 months.
Without government intervention, the report predicts that the festival sector will lose half its workforce between September this year and February 2021.