The Association of Independent Festivals (AIF) has warned that 92% of its members festivals are at risk of closure without further support.

The association also says that zero percent of its members have been able to access Coronavirus Business Interruption Loans, intended to prop up struggling businesses.

The AIF says the festival sector is facing refunds of up to £800m this summer, after many high-profile events have been cancelled or postponed due to Covid-19. AIF members have an average ‘sunk cost’ – a cost they cannot recoup – of £375,000. Only 1.5% of members are covered by insurance for Covid-19 cancelations.

AIF conducted impact surveys in which 92% of members said their firms are at risk without further government intervention. The association has lobbied the UK Government through DCMS on a range of issues related to the current crisis. Examples include clarity on eligibility for grants and loans, and rolling premises license fees over to 2021 for events that do not take place this year.

AIF is calling for a continuation of all employment schemes and business support packages – such as the furlough scheme and business interruption loans – until the festival industry can get to the planning and sales stage of 2021 events.

It also calls for clear guidance about when festivals will be able to operate, as well as any social distancing measures that would be expected in order to maintain public safety.

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.

“Next year’s festival season will hopefully offer much needed relief after a very difficult time for the country. But, for now, these independent businesses need to survive. Otherwise, every year from now could be a fallow year for independent festivals, for the emerging artists they provide a platform for, and the local economies across the UK that they generate income for.”