Event businesses are under such immense pressure that they are now on the brink of collapse. That’s according to the Business Visits and Events Partnership (BVEP) following new research, co-ordinated by the Production Services Association.
With no sign of a roadmap to opening and with a lack of Government support, events professionals and event suppliers – having faced almost a year with no or little trading – are struggling.
In a major industry-wide survey, carried out at the end of last year, research found that 72 per cent of the 1,700 companies and freelancers surveyed, including those from BVEP partner organisations, reported that only approximately three to four months of liquidity was left.
The real damage in the industry is felt acutely by the freelance community, with more than 50 per cent now predicted to be receiving less than the minimum wage as they rely on work in the events sector for at least 80 per cent of their earnings.
Simon Hughes, chairman of the BVEP, said: “Our partner organisations, covering all the main sectors of the events industry, from business events to cultural events, have expressed their alarm throughout the last year. Now a whole industry sector is on the brink of collapse, and the results of this survey confirm our worst fears. While the Government may praise the holding of the G7 Summit this summer, COP26 in the winter and Festival UK in 2022, the success of these events is likely to be severely impaired if no immediate support is given. It is now time for the Government to act decisively and provide the help necessary to save the UK’s events industry.”
With nearly all businesses seeing their event schedules wiped out, the vast majority of those surveyed see no events for at least three months after any lifting of restrictions. However, 66 per cent of organisers and agencies say they cannot run any of their events sustainably and less than six per cent say can operate profitably under existing COVID and social distancing regulations.
The majority, (61 per cent) of event businesses indicate that less than 20 per cent of their 2019/20 turnover is covered by Government support, including furlough payments, CBILS and Bounce Back Loans. A further 18 per cent only received up to 40 per cent of their past turnover in support.
Thirty per cent of self-employed workers in the industry have found themselves not eligible for any support at all. Only 17 per cent qualified to apply for Universal Credit and 55 per cent of respondents were unable to apply for the Self-Employment Income Support scheme.
Three-quarters of event businesses indicate that at least 60 per cent of original capacity is needed to be financially viable, so a lifting or easing of social distancing requirements is essential or support for business and freelancers must be provided whilst restrictions remain in place.
In their budget submission to the Treasury last month, the BVEP put forward proposals for an Event Recovery Fund for both outdoor and indoor events costing just £377 million, arguing this would significantly improve the prospects of the events industry to chart a course back to profitability by Q3 of 2021. This support would be significantly less than that allocated to the arts and creative industry sectors, where the Government has already provided a £1.57 billion Cultural Recovery Fund, despite the benefits of sustaining the entire £70 billion sector being much greater in terms of delivering economic growth.
Andy Lenthall, general manager of PSA, said: “As suppliers to every part of the live events sector, production relies on a healthy ecosystem, from organiser to attendee. Every part of this supply chain is in crisis, every part of the supply chain needs support to ensure an events industry that is at the heart of economic recovery and future growth, especially at a time when our Government is promising to assume a new position on the world stage.”
In further research into the event supply chain, carried out by ESSA, 63 per cent of the workforce in supply companies had been made redundant by the end of December and this was likely to rise to 80 per cent by the end of Q1 2021. Fears are that at this level, there will not the resources necessary to deliver the volume of events now being pushed back in Q3 and Q4 of 2021. With more event suppliers failing and their inventory being sold off, this will be a severe constraint on the ability of the sector to recovery without urgent funding being released by local authorities and extensions to rate relief and extensions to furlough.
Andrew Harrison, chief executive of ESSA said: “From our recent Freedom of Information requests what I am seeing is that in the case of local authorities the funding is there, it is not even new money that is being requested. It is the fair distribution of funds already granted to local authorities who have not created the mechanisms to support these event companies. The disparity and inconsistencies between authorities in how they have issued grants is actually staggering and of the likes I have never seen.”