Chancellor Rishi Sunak has been urged to give consideration in the upcoming budget to nightclubs that will allow them to get back on their feet when the prospect of re-opening eventually beckons.
The stark message comes from industry bosses and nightclub owners, who say that Boris Johnson’s forthcoming road map out of lockdown, which is set to be unveiled next week, should provide clear answers on when they will be able to operate once more.
But even if they are provided with clearer answers, the beleaguered sector says that months of financial hardship means that they will need special consideration on March 3 in order to undertake the necessary steps for re-opening.
Now, industry insiders have told NME that the next two weeks are “critical” in insuring the survival of UK nightlife.
“The budget is going to be a key thing here, if the budget comes in for rescue and regeneration then that’s a very positive place to be,” chief executive of the Nighttimes Industries Association Michael Kill told NME. “But if we get a good road map and a budget that looks to recuperate the funding that’s already been given, then that’s going to place additional pressure.”
“There has to be a projected position, whether that’s VAT savings or holiday extensions, all of these are going to safeguards for the future.
He continued: “The continuation of a reduced rate of five percent VAT for hospitality is going to vitally important, but it needs to be extended to a wider sector. It can’t just be about food and soft drinks.
“People have lost their businesses so they’ll need to recoup and build their cash reserves up. They’re going from a point of loss and striving to get handle on businesses that are overburdened with debt.”
The stark warning comes hours after An All Party Parliamentary Group (APPG) of 40 MPs warned of “ghost towns” cropping up across the UK if the government fails to intervene and support the country’s struggling nightlife sector during the coronavirus pandemic.
Dan Perrin, the Head of Music and Events at South London’s Studio 338, also stressed that a clear road map would provide the necessary time frames that will prove key for re-opening.
“With a venue the size of Studio 338, it’s like a ferry. You can’t just change course or be told with two weeks notice that you can open a 3000 capacity venue,” he told NME. “You can do your first re-opening party, but you’ll be struggling to catch up with the necessary planning that is needed in the future for a venue of that size.
“In normal times, I’d be planning my calendar some 12 months in advance. I understand it’s very difficult for anyone to plan. We try to tune in to what Boris and co are saying, but his tendency to be optimistic means that there have been occasions when we’ve thought we’ll be able to start planning, but it’s been the total opposite.”
Perrin also echoed calls for tax relief, after Studio 338 failed to receive financial support as part of the government’s £1.57 billion Cultural Recovery Fund last year.
“There are many industries that need support, but I would argue that one of the most severely impacted industries in the world is nightlife because we were the first to shut and we’ll be the last to open,” he said. “Other businesses have been able to adapt along with the economy.
“But for straight-up nightclubs, there’s been nothing. You can’t replace what we do virtually, so there does need to be support and patience in allowing VAT and tax reductions. Because when we start again, we’ll be doing that off the back of no income for the last 12 months.”
He added: “The last thing you want is to start getting back on your feet and get a VAT bill. That can be a way for them to make it easier for industries that have been badly hit.”
Similar warnings also came from Manchester’s Night Time Economy Adviser Sacha Lord, who warned of the knock-on effect that could arise from insufficient government support.
“The VAT reduction has been great, but in Greater Manchester for the last year, we’ve had the hardest restrictions and some places have been shut for more than 300 days,” he told NME. “We need the reduction extended and we need furlough extended.
“The live music venues and nightclubs were closed on March 20 and they will be the last to reopen, so unless there is sector-specific support, many will go.”
.@RishiSunak we work hard and pay our taxes, partly to enjoy life
Hospitality, theatre, events, gigs, culture
Whilst the incredible vaccination rollout continues, will you continue support?
Or be remembered as the Chancellor who turned off the lights
3rd March we will know.
— Sacha Lord (@Sacha_Lord) February 18, 2021
He continued: “My biggest concern is for smaller grassroots venues. It’s fine for me as a promoter to put on the big acts like Liam Gallagher, but even they have come from somewhere and if places like Night & Day in Manchester don’t make it, then the pipeline is going to be strangled.
“I’ve been in this industry for 26 years, but the next two weeks for hospitality and the nighttime economy are the most critical of my whole career. We need a route map out of this and extended support from the chancellor.”
“If hospitality is thrown under a bus, then the sixth biggest sector will be decimated.”
Boris Johnson is currently expected to reveal a road-map out of lockdown next Monday (February 22), with the Spring Budget being unveiled on March 3.
NME has contacted the government for comment.
Meanwhile, music venues have backed calls for rapid testing to restart live music, with a number set to trial “health passports” so that gigs can return safely.