British music industry umbrella body UK Music has warned that music venues, studios and other music businesses face closure without swift action in the face of one of the UK’s biggest looming problems: drastically spiking energy bills. Live industry body the Night Time Industries Association (NTIA) – along with four other UK hospitality trade bodies – also released an open letter to the UK government with a similar stark warning.
UK Music Chief Executive Jamie Njoku-Goodwin called on the UK government to help music businesses by cutting VAT from its current 20%, and to extend business rate help. The UK has an energy price cap, which limits how much energy companies can charge consumers per kilowatt hour – and this cap is rising drastically, with many customers shocked at their new bills. However, the situation is even worse for businesses, as the energy cap does not apply to them. “This means,” said Njoku-Goodwin, “that music venues are seeing their energy bills increase by an average of a crippling 300%, and in some cases 740%, adding tens of thousands of pounds to their running costs.”
Based on a survey of its 941 venue members, the Music Venue Trust (MVT) has revealed venues face an average 316% rise in fuel bills – taking the average fuel bill cost to £5,179 per month per venue – up from the current average of £1,245. The means that “around 30% of the entire network of venues face the threat of permanent closure.”
NTIA et al’s open letter makes grim reading too. It makes it clear that, on top of facing supply chain issues, labour shortages, increasing interest rates, and inflation, “rocketing energy prices have become a matter of existential emergency for businesses in our sector.”
“Hospitality operators face average annual bill increases in the region of at least 300%, putting at risk businesses and jobs. It is also increasingly clear that a significant number of energy providers have withdrawn service provision from the Hospitality market altogether.”
It concludes: “we urgently need the Government and the leadership contenders to outline a support package for the sector.” Michael Kill, CEO of the NTIA, put the possible outcome plainly: “without the Government’s intervention, businesses who have survived the pandemic, supported by public funding, will face further uncertainty, and in many cases, permanent closure.”
Sasha Lord, night time economy adviser for Greater Manchester and Chair of the NTIA, urged “the new PM to announce Hospitality intervention measures next week,” in a tweet, and his message highlights a political vacuum: at the same time that this energy crisis unfolds, the UK government is in a five-week recess, the outgoing Prime Minister Boris Johnson has been on holiday, and the new PM has not yet been chosen by the UK’s Conservative party. “I’ve never had as many calls from operators,” Lord said, “Scared, anxious, stressed. Ready to give up.”
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