The entertainment industry saw a 44.5% reduction between March and June 2020

The coronavirus pandemic has badly impacted the UK cultural sector. Diverse activities from live performance and theatre productions, to exhibitions and galleries, have seen their revenues fall dramatically as venues have closed their doors and gatherings have been prohibited to maintain social distancing.

According to the Office for National Statistics, the arts and entertainment industry saw a 44.5% reduction in monthly gross domestic product (GDP) output (according to gross value added (GVA)) in the three months up to June 2020 compared with the three months earlier, making it one of the sectors worst hit by the pandemic, as exemplified in the table below.

What have the government done?

In October 2019, the Government had already announced a culture investment fund worth £250 million for the cultural and creative sector. Ministers contended this investment was “the biggest one-off government investment in cultural infrastructure, local museums and neighbourhood libraries in the last century”.

During the course of the pandemic, the Government announced a range of further support measures arts and entertainment organisations can access for support, including the self-employment income support scheme, the job retention scheme, business rates holidays, and an initial £160 million emergency response package provided by the Arts Council.

On 5 July 2020, the Government went further, announcing a £1.57 billion rescue package for the UK’s arts, culture and heritage industries.

The measures included:

• £1.15 billion support pot for cultural organisations in England delivered through a mix of grants and loans. This will be made up of £270 million of repayable finance and £880 million in grants.
• £100 million of targeted support for the national cultural institutions in England and the English Heritage Trust.
• £120 million capital investment to restart construction on cultural infrastructure and for heritage construction projects in England, which was paused due to the coronavirus pandemic.
• The new funding will also mean an extra £188 million for the devolved administrations in Northern Ireland (£33 million), Scotland (£97 million) and Wales (£59 million)

Our arts and culture are the soul of our nation. They make our country great and are the lynchpin of our world-beating and fast-growing creative industries. I understand the grave challenges the arts face and we must protect and preserve all we can for future generations. Today we are announcing a huge support package of immediate funding to tackle the funding crisis they face.

However, Mr Dowden also acknowledged this support would not be enough to safeguard every organisation or job in the arts and entertainment sector:

Sadly, not everyone is going to be able to survive and not every job is going to be protected and sadly, I will have to be honest with you, of course we will see further redundancies.
The support package has been welcomed by organisations across the sector, including the Arts Council England, the Royal Opera House, the Music Venue Trust, the Society of London Theatre and UK Theatre. Arts Council chairman Sir Nicholas Serota said the funding was “a very good result”, and that it was now up to the arts organisations and the Arts Council to “make best use of this money and bring the arts back into communities across the county”. He added, this announcement “gives us the tools to help build a recovery”.

However, there has been criticism that the funding is a one-size-fits all model which does not take account of how some aspects of the industry work—for example, small comedy venues which remain closed.

A more tailored approach?

The House of Commons Digital, Culture, Media and Sport Committee has also said the funding has come too late to save many organisations. The committee questioned the desire to return live sport—particularly football—ahead of theatre and performance:

Each year, more people attend the theatre than go to a league football match, yet while considerable effort has been made to resume professional football, the Government’s roadmap for when theatres will reopen has been vague and slow-coming. We welcome the Government’s announcement of a £1.57 billion support package for the arts, but it was too late for many in the sector and on its own will not be enough to stop mass redundancies and the permanent closure of our cultural infrastructure.

The committee called for a sector-specific deal for the performing arts that includes:

• An extension to the furlough scheme for affected businesses until mass gatherings are permitted under the Government’s and devolved administrations’ Covid-19 guidelines.
• Continued workforce support measures, including enhanced measures for freelancers and small companies.
• Clear, if conditional, timelines for when they will be able to reopen, and technological solutions to enable audiences to return without social distancing.
• Long-term structural support to rebuild audience figures and investment in an uncertain economic climate. This should involve new, sector-specific tax reliefs as well as an extended VAT cut for the sector.

The committee was also critical of the response of the Department for Digital, Culture, Media and Sport (DCMS) to the pandemic across the board:

Finally, we examine how effectively DCMS has advocated for the sectors under its remit during this crisis. With many vital Government support schemes due to end, or not sufficiently covering those working in these sectors in the first place, we argue that DCMS’s position within Government, and a fundamental lack of understanding about how DCMS sectors and their workforces are structured, has hampered the support provided by Government during the outbreak.

Source: House of Lords Library, James Tobin, 04 September 2020, https://lordslibrary.parliament.uk/covid-19-impact-on-the-uk-cultural-sector/