Night-time economy staring at ‘extinction’ without urgent help

MPs on the All Party Parliamentary Group (APPG) for the Night Time Economy declare today that the sector faces “irreversible losses” without immediate action to support bars, pubs, nightclubs, live music venues, festivals and businesses in their supply chain.

The APPG is calling on Prime Minister Boris Johnson and Chancellor Rishi Sunak to provide a sector-specific grant package and a roadmap to re-opening, warning that failure to act risks creating “ghost towns” around the country that would hinder the economic recovery from the pandemic.

The stark warning comes with the publication by APPG of the findings of its extensive inquiry into the impact of Covid-19 into the night-time economy, which has been largely shuttered since the first national lockdown was imposed in March last year.

Based on more than 20,000 responses from consumers, employers, employees and freelancers in the sector, it found 85 per cent of people working in the night-time economy are considering leaving the industry, with nearly four-fifths (78%) having been on furlough at some point.

Firms have on average made 37% of their total workforces redundant, while just 36% of self-employed nightlife workers have been able to claim the Self Employment Income Support Scheme, the survey reports.

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It also found that, in the second half of 2020, businesses in the night-time economy had generated 28 per cent of their annualised pre-Covid levels, on average.

The findings will come as no surprise to industry figures, who have been campaigning for months to highlight the plight of the sector and the need for additional support.

Guidance has still to be issued by the UK and Scottish Governments on when the hospitality industry can reopen, and it is expected that nightclubs and live music venues will be the last do so, given the likelihood that social distancing measures will remain in place for some months to come.

Mike Grieve, co-owner of the long-established Sub Club in Glasgow, said the survey findings are “unsurprising, but it is quite revealing when you see 85% of people working in the night-time economy are considering leaving the industry.”

Mr Grieve, who is the Scottish chairman of the Night Time Industries Association, added: “That is a pretty stark statistic for a sector of the economy, never mind a cultural sector.

“It is a very significant part of the UK economy. If that was the car industry, for instance, there would be massive outcry about it.”

“What this (report) does is bring a focus and a much-needed spotlight, at UK Government level, on the plight of the industry.”

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As well as dealing with closure, the APPG report notes that even when outlets have been able to trade, businesses in the night-time economy have had to deal with numerous and changing restrictions, and had to invest to comply with social distancing, hygiene and other compliance measures.

Among its recommendations, the APPG is calling for an extension of the furlough scheme beyond the end of April, when it is due to close, and the extension of value-added tax relief.

It says the eligibility for the Culture Recovery Fund should be expanded, that a sector-specific support package, should be provided, and that the Government provides a roadmap for reopening late-night venues, based on the vaccination programme and mass testing.

The report also recommends setting up a Government-backed insurance scheme and a “solution to spiralling commercial rent debt”.

Jeff Smith, MP and chairman of the APPG said: “Our world-leading night clubs, pubs, bars, and live music venues are cornerstones of our communities. They drive so much economic activity both locally and nationally, and bring hope, joy and entertainment to millions across the UK.

“Our findings today reveal this industry is on its knees, in desperate need of additional support from the Government and a concrete plan for reopening. Without these interventions, many of these viable businesses will go under, leaving city and town centres resembling ghost towns.

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“If the Government is serious about its ‘levelling up’ agenda it must act now to save this sector and avoid untold damage to the social fabric of this country.”

The NTIA says in the report that the Covid-19 pandemic has had a “devastating impact” on a sector that provided 1.3 million jobs, around 8% of the total UK workforce, and contributed £66 billion to the economy.

Michael Kill, chief executive of NTIA, said: “We are pleased to support the APPG for the Night Time Economy when it became clear our industry’s needs weren’t being heard by policy makers. But it gives me no pleasure today to announce the findings of this report, which confirm the devastating impact that the pandemic has had on UK nightlife.

“Every day I speak with the dedicated people that make up this industry – from artists to engineers, bar staff to security, and production to promoters – they have shown great resilience in the face of adversity.

“But resilience only gets you so far without the required support. We need more assistance and a detailed plan for reopening now. Otherwise, much of what defines a night out in the UK will be lost forever.”