Joe GallopThe Association of Independent Festivals (AIF) CEO John Rostron has called on the government to reduce VAT on ticket sales from 20% to 5% for the next three years, as the number of 2023 festival cancellations continues to grow.
Speaking to Access All Areas, Rostron said, “You can’t reduce fees to suppliers because some of them haven’t survived or have drained reserves; we’ve increased ticket prices by 12-15% but we can’t pass 30% rises on because people are in a cost of living crisis. Or if we do, we are going to fail because we’ll become unaffordable to people.”
Following AIF’s research that found one in six (16.6%) UK festivals came to an end during or in the wake of the Covid-19 pandemic, it’s most recent data has tracked 31 small events that have been called off this year, with the majority citing economic issues.
“We just need a few years where we can build up reserves and make profits,” said Rostron. “All of our festivals reinvest their profits back into the event. They need the good years to help ride the bad years. If they had money they would be doing that.
“The reduction of VAT would give them that breathing space if there’s market changes or behavioural changes.”
Recent cancellations
As well as recent cancellations, including One Love, Farmfest and 1 Big Summer, Rostron said the other concern are the events that are going ahead but running at a loss. Recently run events to have been open about this issue include Barn on the Farm and Nozstock.
“We might not see them fall now, but we might see them fall and not come back. We’ve been warning the government about this since March.”
Rostron said the most common reason for event cancellations is “pressures on the industry”, including rising costs, the cost of living crisis and slower and more unusual ticket buying behaviour.
“If you look at the reasons it looks like a lot – but we don’t know if it’s a lot because we don’t have the numbers from previous years.”
Rostron said strict trading terms from the supply chain have also been a factor: “It doesn’t give that space to festivals to ride that wave of any changers. If ticket sales are a bit slower, they don’t have the time to wait to get the sales in because terms are tougher now.
“A lot of events last year ran on 2019 sales but 2022 prices, so a number of events sold out but still made a loss – and that hasn’t given them the liquidity to wide the wave of the changing market this year.”
The second biggest reason, he says, is weather, which has recently led to the cancellations of events such as Loosefest and Bluedot (Sunday ticketholders only). Rostron also noted other factors such as unscrupulous promoters and licenses being revoked as reasons for recent cancellations.
As well as more families buying tickets via payment plans, Rostron cites other behavioural changes related to Covid, with customers buying tickets for concerts last-minute: “We’re seeing lots of young people not buying tickets because they didn’t go to events during Covid, so it’s not on their radar.”
To solve this issue, the AIF recently launched its First Festival campaign to provide tickets for those who were denied opportunities to attend festivals during the pandemic.
“Two years of not going to your first festival, means you’re not going to a festival now. If you don’t go to a festival now, would you ever go to a festival? What’s that going to mean for the sector?”