During lockdown most film, TV and cultural production stopped, all performance venues closed and the demand for most creative services withered. Some activity has since re-started, but most live events are commercially unviable with social-distancing in place, and other activity will suffer from the compliance costs of making activity COVID-secure.
In recent years the creative industries have been one of Wales’s best-performing sectors. Film and television production has been a particularly high-growth area, with GVA of motion picture, video and TV programme production more than tripling between 2007 and 2017 (from £62 million to £200 million).
How far will the Welsh Government’s £53 million coronavirus Cultural Recovery Fund be able to sustain this growth?
A “cultural catastrophe”
In June the Creative Industries Federation warned that the UK faces a “cultural catastrophe”. According to analysis it commissioned from Oxford Economics, Wales is projected to lose 26% (15,000) of its creative jobs and see a 10% (£100 million) drop in creative industries GVA . It notes that “the UK’s creative sector was previously growing at five times the rate of the wider economy.”
Creative Cardiff has estimated that there are 40,000 freelancers working in the Welsh creative industries. The majority of their work dried up as soon as lockdown was announced. Concerns have been raised that those working in the creative industries may fall through the cracks of the coronavirus self-employment support, by bodies including the Senedd Culture, Welsh Language and Communications Committee (Impact of the COVID-19 outbreak on the creative industries), the House of Commons Treasury Committee (Government must act over gaps in support during lockdown) and the House of Commons Digital, Culture, Media and Sport Select Committee.
Many employees have so far been protected from redundancy by the UK Government’s furloughing scheme. This is due to end in October, before many performance venues anticipate being able to run at a profit. Back in June the Wales Millennium Centrecancelled all shows in 2020, with 250 jobs at risk, and has forecast that it could lose £20 million this financial year.
Along with limits on capacity, venues are among those in the creative industries who will face additional costs in carrying out activity safely. Mark Davyd from the Music Venues Trust explained to the Culture, Welsh Language and Communications Committee (CWLC) that music venues’ “very low margin of profitability” would be further reduced by “a lot of extra staffing and … a lot of additional cleaning and additional control measures”.
In its July report into The impact of COVID-19 on the creative industries the Culture, Welsh Language and Communications Committee called for both the self-employment support and furloughing schemes “to be extended beyond October 2020 because the reopening of the sector is likely to be gradual and will not return to full employment before that date”.
The ability to get insurance cover which allows for Covid-19 related claims is a major factor hindering a return to work for physical production in the screen industries, as well as live performances.
Ffilm Cymru’s Pauline Burt explained to CWLC in June that, in the absence of insurance, “you’ll only see productions taking place that are able to […] self-insure”. This, she thought, would mean that broadcasters and others working with smaller budgets could proceed, as could “the larger studios that have an economic imperative to fill their pipelines”.
Between these extremes, she felt, operators faced losses if production was disrupted on a scale they could not afford to cover. “Frankly”, she said, “I'm not expecting to see anything between £1.5 million and up to studio level being capable of going into production until this insurance issue is addressed”.
The UK Government has since announced a scheme to help film and TV production access production insurance.
The Cultural Recovery Fund and the missing £6 million
On 5 July the UK Government announced a £1.57 billion support package for the arts, culture and heritage. This includes a package of support for cultural institutions in England, and consequential funding for the devolved governments, who are free to decide how to spend this money. The funding included £59 million for Wales (less than a population-based shared of the total UK funding).
On 17 August Arts Council of Wales opened its portion of the fund (£27.5m) for applications. This comprises £25.5m of revenue and £2m of capital funding, all for arts organisations. The Arts Council of Wales will be managing funds for:
- theatres, arts centres and concert halls;
- organisations producing and touring arts activity; and
- organisations providing participatory arts activity.
The Welsh Government is managing the remainder of the fund (£25.5m) for:
- music venues;
- Recording and rehearsal studios;
- heritage organisations and historic attractions;
- accredited museums and archive services;;
- events and their technical support suppliers;
- independent cinemas;
- the publishing sector; and
- individual freelance creative professionals.
An online eligibility checker opened on 1 September, with organisations able to apply between 14 and 30 September. £7 million of this funding is available to support freelancers.
CWLC had previously called for the entirety of the £59 million allocated to Wales to be spent on culture. When the Welsh Government announced the Cultural Recovery Fund it said that this £53 million came “on top of the £18m portfolio package provided in April, which was delivered by the Welsh Government, Arts Council of Wales and Sport Wales”.
The majority of this £18 million package is not directly comparable to the new “cultural recovery fund”. The £18 million package included £8 million for sport, and the culture funding from this package included at least £5.1 million from non-Welsh Government sources, such as the National Lottery.
The culture COVID interventions that were funded earlier in the year by the Welsh Government were fiscally neutral: that is, money allocated to tackling the impact of COVID in these areas was from the existing budget allocations in these areas.
Does the Welsh Government have enough “firepower”?
In Committee for Scrutiny of the First Minister on 3 July, the First Minister recognised the difficulties faced by cultural organisations and individuals whose incomes continue to be reduced by the pandemic.
He called for the UK Government to extend the self-employment income support scheme and furloughing schemes “so they continue to support those parts of the economy that will not be able to resume”, saying that the Welsh Government lacked the “firepower to support a whole sector”.
This was days before the UK Government announced its culture funding package, including consequential funding for the devolved nations.
Will this package be enough, not just to continue to support the creative industries once the UK Government coronavirus employment support schemes end, but to fill these schemes’ long-acknowledged gaps?
Article by Robin Wilkinson, Senedd Research, Welsh Parliament
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