A new report from the Music Venue Trust shows that grassroots gig spaces in the UK are “going over a cliff” – shutting off the pipeline of future talent without urgent government action and investment from new large arenas.
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The MVT, which represents almost 1,000 UK grassroots music venues, has today (Tuesday January 31) shared its 2022 annual report – laying out the value of the sector to both the UK economy and the music industry, as well as the grave danger that venues and UK face without urgent action. As it stands, the latest figures show audience numbers were at 89 per cent of their 2019 level, at about 21million.
The report was launched last week with an event attended by NME at the Houses Of Parliament, with a sobering speech from the MVT and a performance from patron Frank Turner.
“This is a £500million sector delivering 177,000 events a year, employing 31,000 people, and with 21million people visiting grassroots music venues every year,” said MVT CEO Mark Davyd at the event. “It’s remarkable that we have to publish a report before anybody noticed that. We should have known that all along – how important these venues are to local communities and to our friends from the music industry.
“However, that’s the end of the good news. This sector is really seriously in trouble. With £500million of turnover, that’s £499million in costs and a a 0.2 per cent profit margin. It’s not sustainable. There are 177,000 events happening, but it’s down 16.7 per cent. We used to do an average of 4.2 events per week at these venues, and we’re now down to 3.5.”
He continued: “Every single one of those venues that isn’t doing one of those shows means a musician who isn’t getting their first chance, it’s someone who might never step foot on a stage, it’s a lost career for that individual and to the British music industry, it’s a loss to that community, and it cannot go on. It has got to stop.”
Highlighting a number of “very significant problems”, Davyd started by pointing to the cost of the energy crisis – which threatens to “close more venues than COVID” unless addressed.
“The Chancellor’s position on the Energy Relief Package is nonsense,” said Davyd. “I’m sorry to say that in Parliament and I’m supposed to be non-political, but it won’t work. We have venues with a 0.2 per cent profit margin, facing a seven per cent increase in their energy costs on April 1. That’s in three months. The Chancellor has written to OfGem asking them what they might do. It doesn’t matter what they might do.
“There is a package of support for industries that might fail if they can’t afford their energy, and the grassroots music venues need to be in it – now. We can’t wait until April 1 to find out whether OfGem are in a good mood. We need change on this right now. ”
Elsewhere, the MVT also highlighted the VAT applied to venue ticket sales as “crushing the economic viability of this sector and reducing the ability of the grassroots to create new British talent.”
“We’re operating on a 0.2 per cent profit margin with about £1million in profit being made – that’s on £133million of tickets,” said Davyd. “They’re spending £212million on live music, and losing £79million promoting new artists, emerging talent and investing in our communities. That can’t go on.
“It can’t be the responsibility of a music venue in Bromsgrove on a Tuesday night to go to a cashpoint and take their own money out so that we can build the careers of artists which the music industry goes on to make millions of pounds for and pay unbelievable amounts of tax.
“You’ve got to ask yourself as a Parliamentarian, how many Ed Sheerans do you want? Because we produced the last one and we can produce the next one. He played 366 shows at the grassroots music level, and Ed will tell you himself that he learned how to be Ed Sheeran. He didn’t just walk on stage and could suddenly headline Wembley – it took him 366 shows.
“You need a space where people can learn their skills.”
Davyd explained how UK venues are “paying a ludicrous amount of tax out of this sector and into the treasury and that’s through pre-profit taxation” – at a highly uncompetitive rate compared to the much of the rest of Europe.
“We’re paying that through VAT on tickets at 20 per cent, which is the highest of any major music nation Europe – second only to Lithuania in the amount we charge people for putting on new and emerging talent. That is ridiculous,” said Davyd.
“Grassroots venus are the research and development wing of the music industry. Why the hell are we taxing people for doing that? We don’t do that in any other industry. If you want people to create new products, new British intellectual property rights, and to create ‘Brand Britain’, then what are you taxing them at source for? That makes no sense. Why pay more to see our own artists in our country than you have to pay in tax to see them in France?”
As well as calling for changes to planning applications so that the MVT can get involved to stop developments and residents launching noise complaints against existing venues – a matter that Manchester’s Night & Day are currently battling with – Davyd also demanded an end to “excessive business rates” that cripple grassroots spaces.
“These are places that make people go out and that get people inspired,” he said. “Every £10 spent in a grassroots music venue leads to £17 spent elsewhere in the night time economy. If you want to get this economy moving, you’ve got to break down the cost.
“I’ll offer, on behalf of every grassroots music venue, to pay 50 per cent tax on all profit we make on live music – because we’re not making any money on live music, but you’re making us pay tax and it’s completely unsustainable. VAT has to come down, business rates need to be reviewed, that’s the end of it. Please get on top of this, Parliamentarians. It’s really cutting the legs out of our industry.”
Government aside, MVT also outlined plans to require all new music arenas opening in the UK to “contribute to the security of the wider music ecosystem by investing a percentage of every ticket they sell into the grassroots music ecosystem”.
“I’m putting the music industry on notice: we are over the edge,” Davyd told those assembled at Parliament. “We’re not near the edge, we’re over the edge and we’re tumbling down. You need to throw a lifeline down. We can’t pay £79million a year to create the artists that are going to appear on your festival stages. It’s not possible for us to do that.
“There are eight new arenas being built in the UK. I told someone from the industry this and they couldn’t believe me, although it’s probably their artists that will be filling it for the next six years or so. But they won’t be filling it in 10 years, because it’s possible that The Rolling Stones will eventually die.
Davyd continued: “We have got to have a proper research and development arm in this country that supports new artists, develops their careers and brings them out of this. That is the responsibility of everyone in this industry, and it simply isn’t good enough to wait for a lone venue operator to take a chance on a new band, losing money until you can wait until they sell enough tickets to take it up a level so the artist can never go back there again and there’s no return for that venue operator.”
Pointing to the eight new arenas being built across the UK in the coming years, Davyd demanded that “not a single one of those arenas should open unless it has a policy where every ticket sold is investing back into grassroots music venues and grassroots artists”.
“Otherwise, you’re building a carbuncle, a white elephant in the middle of our major cities that will not be filled in 10 years time because there won’t be the artists to fill it,” he argued. “Co-Op Live in Manchester will be a 23,500 capacity venue due to open later this year or early next year. It has no plan at all to invest in the grassroots venues that are going to create the artists that will fill that stage in 10 years time. That is not good enough.
He went on: “I’m telling Andy Burnham, I’m telling Manchester MPs, I’m telling Manchester City Council: you should not grant a licence for that venue to open if it can’t work out how to put money back into the grassroots system from which the artists it relies on are being produced.
“Say no to these arenas unless there is a pipeline. The arenas have got to get on board. You can do it for 50p on a ticket. You know how much these tickets cost? At 23,500 tickets a night, you’d raise £11,000.”
Davyd added: “The distribution of wealth in this industry has got to change and be sustainable for grassroots or we all heading down over the cliff. You’re coming with us, you’re chained to us, don’t leave us dangling, come and support us.”
I was delighted to host the @musicvenuetrust at the Houses of Parliament recently for their Annual Report. If you're interested in supporting grass roots music venues and want to know how you can get involved with MVT's campaigns, visit their website here: https://t.co/puO0JAM7ro pic.twitter.com/zLzxeRWeev
— Kevin Brennan MP (@KevinBrennanMP) January 30, 2023
The event at Parliament took place at the invitation of MP Kevin Brennan – who began by arguing that grassroots music venues are the “research and development arm of the UK music industry”.
“This is where the future of the industry lies,” he said. “It’s the pipeline. Continually, grassroots music venues are potentially under threat. We’re one of the few countries in the world who are a net exporter of music, and that’s not going to carry on being the case unless we’ve got a very vibrant grassroots music sector across the country.”
MVT patron Frank Turner, who performed several songs on the night, agreed with Brennan but argued that “that is not the only reason that the grassroots music sector matters”.
“There is an awful lot of art and culture that exists in these spaces but isn’t going on its way to be a stadium act,” said Turner. “It’s just art that is worthy of our consideration, our support and our belief. Let’s believe in every band who plays in a grassroots music venue, or at least who gives it a go.”
Visit here to read Music Venue Trust’s full annual 2022 report.
Last year, MVT also launched its ‘Own Our Venues’ campaign aimed at providing ownership to grassroots music venues across the country.
The scheme, which was backed recently by Ed Sheeran, aims to secure the long-term futures of these venues by directly tackling the issue of ownership. The scheme has been likened to “The National Trust, but for venues”.