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Supply Chain Risk

Newbury company explains why whole live events supply chain is at risk

THE live events and entertainment industries have been an important yet underappreciated contributor to the UK economy, our exports and reputation overseas. The sector is broad-ranging and supplies the entire technical infrastructure to put on events, from concert venues and theatres, both large and small, to conferences and incredible opening ceremonies such as manufacturing the technology and possessing the skills to stage all of these, both in the domestic market and for worldwide export.The industry spend is £39.5bn with a GVA – gross value added, the measure of the value of goods and services produced in an area – of £30.4bn and there are more than 600,000 jobs in the sector, which employs people in all parts of the UK and has even more potential to support the Government’s levelling up agenda.

ON Wednesday, September 30, some 27 countries worldwide took part in the #WeMakeEvents day of action, starting from New Zealand at 8am GMT and some 2,300 buildings registered to #LightItInRed. There were also sites around the UK taking part in the Shine a light project, with white shafts of light representing 600,000 events workers. Greenham Control Tower was one of those sites, lit up by Skan PA and Moonraker Disco with power generation by Sunley Event hire, three companies in the live events supply chain that have felt the full force of the Covid crisis.

Following Government guidance in March 2020, these industries had to instantly ‘close their doors’ to reduce the risk of Covid-19. They will not be able to open again in any significant way until mass gatherings can safely take place. A whole industry lost its livelihood overnight. Opening with reduced capacity audiences is not financially sustainable as events only break even at around 70 per cent capacity, and the insurances necessary to stage them are currently impossible to obtain.

Most of the supply chain businesses, such as rental companies, manufacturers, venues, festivals and crew suppliers, were not eligible for the Government’s £1.57bn Culture Recovery funding. Tom Tunney, from Newbury company Skan PA and #WeMakeEvents – which was formed in April by industry bodies and professionals – said: “We are very grateful for the support of Laura Farris MP. She has taken time to listen to and understand the situation in the events sector and has made our case at DCMS and HM Treasury and also in the chamber.

“Laura’s enquiries with DCMS confirmed that we were ineligible for aid as part of the CRF.”

Tom Tunney Skan PA

The figures from Skan PA starkly illustrate the scale of the crisis that live events companies and freelancers currently face: Their turnover from May to October 2019 was £2.4m; the corresponding period this year is a projected £1,000.

Further, says Tom: “Skan has been profitable (and tax generating) in every year since the current owners incorporated it in 1996; but the current financial year is projected to be a loss in excess of £1m.”

The industry wants the Government to consider five ‘asks’:
1. To back a Covid-19 insurance scheme to ensure if local lockdowns happen event organisers will recover costs and attendees will receive a refund. The Government has backed the film sector in a similar way.

2. Government support for widespread proactive Covid-19 testing for event attendees, to give confidence to both attendees and organisers that the event is safe and Covid-compliant.

3. A three-year extension to the reduced cultural VAT rate on tickets in line with Department for Digital, Culture, Media and Sport (DCMS) recommendations to stimulate the return of a viable live entertainment sector.

Until gathering for events is not restricted by legislation, it is also calling on the Government for:
4. Grants – not loans – made available to businesses in the events supply chain to give companies the flexibility to allocate financial resources where they need it most, to keep their
business afloat and to enable them to keep employees, adding value to the UK economy and culture in the future.

5. A specific job support scheme for live events supply chain until the Government guidelines change on social distancing to allow a commercially viable return to work to allow employers, the freelance community, including single director companies from the previously economically successful live events sectors to retain highly-skilled people in preparation for a return to work, helping kickstart the industry and hence the UK economy.

The live events industry performed exceptionally well before the Covid-19 crisis and has always been a self-supporting sector and has performed well during previous recessions. “With appropriate support and protection, the sector could bounce back rapidly,” says Tom, “and has the potential to develop and create further benefits to the UK economy.”

The Government’s £1.57bn fund for culture does not reach the majority of this sector and does not recognise that the creative, events, leisure, performing arts, music, TV and film sectors combined bring in more than £100bn a year and support in excess of 600,000 highly-skilled jobs. (DCMS (2018), Events Industry Forum report (2018).)

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