MPs urge Chancellor to save festivals

More than a dozen MPs and over 100 event industry executives have signed a letter to the chancellor of the exchequer Rishi Sunak, copying in prime minister Boris Johnson, calling for him to implement a Government-backed insurance scheme for festivals and live music events or face them disappearing from our fields and cities for good.

The letter, written by DCMS Committee chair Julian Knight MP, follows the 5 January opening hearing of the Committee’s inquiry into the future of UK music festivals, during which festival operators emphasised the urgent need for Government support.

At a crucial point in festival planning schedules, MPs warn that organisers and investors are unable to risk repeating losses sustained in 2020 unless events can be insured against cancellation.

With the commercial insurance market not expected to offer Covid-related insurance until 2022, a Government-backed scheme is required for festivals to start planning their events and signing contracts with artists and suppliers.

The letter urges the Government to extend to other creative industries the underwriting schemes already offered to the film and television industries.

The letter points out that in 2019, festivals added £1.76 billion in gross value to the economy, with almost 1 in 3 Britons watching Glastonbury on TV.

Knight said, “The Government is telling us that life should be getting back to normal by the summer but unless it can provide a safety net, it will be a summer without festivals. The industry says that without government-backed insurance, many festivals and live music events just won’t happen because organisers can’t risk getting their fingers burnt for a second year.

“The Committee has heard from festival organisers that this is a matter of urgency. Insurance must be the first step in unlocking the huge contribution that festivals make to our economy, protecting not only the supply chains, but the musicians who rely on them for work.

“The Government already offers a level of cover to the film and television industries, now is the time to extend support to other creative industries or risk losing some of our best loved and world-renowned festivals.”

Read the letter in full below:

Rt Hon Rishi Sunak MP Chancellor of the Exchequer HM Treasury
1 Horse Guards Road London
SW1A 2HQ

By email

Dear Chancellor,

6 January 2021

Festivals, live performance and live music are the lifeblood of the UK entertainment industry, providing a huge contribution to our cultural landscape and our economy. In 2019 alone, the gross value added to the economy by festivals was £1.76 billion, and almost 1 in 3 Britons watched Glastonbury on TV. Live music is also a major reason why people visit the UK’s nations and regions: in 2019 music tourists spent £460 million across the Midlands alone and sustained more than 45,000 jobs nationwide.

Planning for this year’s festivals, live performances and events is taking place now, and while the vaccine rollout is cause for optimism, organisers need confidence that this work and investment will not go to waste. Central to that confidence is insurance.

Without insurance, the events we know and love simply won’t take place this year—vaccine or no vaccine. Sustaining losses like those we’ve seen in 2020 for another year isn’t an option, and hundreds of businesses in the events supply chain have already been forced to fold. The Government has backed insurance for the film and television industry to the tune of £500 million. It’s now time to do this for other creative industries.

There are a number of forms this could take. One of these requires no upfront contribution from the Government and utilises the existing Pool Re structure, developed in response to unpredictable and devastating acts of terrorism. This would leave Treasury with a maximum liability of £1.5 billion and could be adapted to cover a range of sectors – including hospitality, sports, and leisure, as well as festivals, live performances and events.

What’s clear is that insurance is of the utmost importance when it comes to getting our economy going again across the whole of the UK. Whatever form it takes, businesses need to be able to access reliable insurance schemes to get back on track. Government underwriting is the only way this will be possible.

We call on you to act now and back the UK’s renowned events, music, festivals, hospitality and theatres, to name but a few, so that livelihoods are saved and people have something to look forward to in summer 2021 and beyond.

Yours sincerely,

Julian Knight MP, Chair of the DCMS Committee