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Festival season dealt blow with no insurance offered in Spring Budget

Music industry figures say government-backed insurance is needed for festivals to plan with security for 2021

  • Words: Patrick Hinton | Photo: Jake Davis
  • 4 March 2021
Festival season dealt blow with no insurance offered in Spring Budget

The UK festival season has been dealt a blow with no event cancellation insurance forthcoming in the Spring Budget.

The government’s recent unveiling of a roadmap to reopening the economy aiming for clubs to reopen and festivals to be able to take place from June 21 sparked positivity among the industry and consumers, with multiple festivals around the UK selling out in rapid fashion since the announcement.

However, the lack of cancellation insurance offered by the government has been a cause for concern for festival organisers, with Paul Reed of the Association of Independent Festivals (AIF) saying it is an “enormous risk” for independent festivals to press on with planning without cover.

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Some events are still considering it too risky to plan for summer 2021, with small festivals such as En Masse postponing for another year and major events such as Glastonbury taking the decision to cancel its 2021 edition.

Schemes of this kind in Europe have seen Germany set up a €2.5 billion cancellation fund to cover the cost of events planned for the second half of 2021, and the Dutch government create a cancellation fund of at least €300 million to cover festivals aiming to place from July onwards.

It was hoped that the Spring Budget, announced on Wednesday March 3, would include cancellation insurance cover, with Sacha Lord, founder of Parklife Festival, calling it “the most critical day of my 26-year career.”

There has been money allocated to the arts and music events sector in Chancellor Rishi Sunak’s plans. The £1.57 billion Cultural Recovery Fund is being boosted by £300 million, £300 million is being allocated to the arts sector, and the 5% VAT rate on tickets sales will be extended for the next six months. However, no insurance cover was forthcoming.

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Julian Knight, chair of the Digital, Culture, Media and Sport (DCMS) committee said: “It is welcome that the Treasury has listened to the case pressed by this committee for additional support for our outstanding arts, creative and sporting sectors that have been hit so hard by the impact of the pandemic.”

“However, it is greatly disappointing that the Government appears not to have heard our call to give its backing to cancellation insurance schemes for festivals, which would provide a safety net should organisers need to cancel plans and enable more to go ahead with confidence this summer.”

AIF’s Paul Reed insurance is necessary for festival plans to properly mobilise, saying: “As we have repeatedly stressed, the only way they can do this is with a government-backed insurance scheme that covers COVID-19 related cancellation. The Chancellor today confirmed the extension of the government-backed restart scheme for film and TV productions – a similar safety net needs to be put in place before the end of March to avoid mass cancellations throughout the UK’s festival market.”

Greg Parmley, CEO of LIVE, said: “Today’s budget focused on helping live music to survive the long months of closure still ahead of us – and we desperately need that. But we also call on the Chancellor to look again at a Government-backed insurance scheme, which would ensure we can recover, and get people back to work, as quickly as possible once it is safe to lift restrictions.”

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Steve Heap, the General Secretary of the Association of Festival Organisers, said: “The Chancellor appears to have heard our need for support and we welcome the holding of five percent VAT on ticket sales to September 30 2021. This extension will give festivals the chance to sell tickets at the lower rate and provide much-needed cash for our businesses.”

“Our industry needs a Government-backed insurance scheme to allow us to get back up and running in 2021. We will continue to campaign for this insurance support because without the certainty it provides, the UK economy could lose most of our economic contribution to the economy.”

Sacha Lord also expressed the need for insurance and indicated it may be forthcoming in future, saying: “Concerned we still don't have a Government-backed COVID indemnity insurance policy for events. It's critical and hundreds of events, including weddings are relying on this. I know Westminster and the Treasury are considering it, so I will continue to drive this through.”

Patrick Hinton is Mixmag's Digital Features Editor, follow him on Twitter

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