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LN Asia-Pacific, TEG, and LEIF are calling for more government support as new report reveals the devastating impact of Covid restrictions on live
By IQ on 14 Oct 2020
Australia’s live industry is estimated to suffer a AUS$23.6 billion downturn in 2020 if restrictions remain in place till the end of the year, according to a new report by EY.
Preliminary findings from the report, The Economic Cost of Covid-19 on Australia’s Live Entertainment Industry, suggest that the pandemic will lead to a 65% drop in the total economic output of the industry from $36.4bn in 2019 to $12.8bn in 2020, if restrictions aren’t lifted.
Likewise, the total value added by live entertainment is predicted to fall by 65% from $16.6bn in 2019 to $5.9bn in 2020, a fall of $10.7bn.
Furthermore, the report forecasts that full-time equivalent jobs will decrease by two-thirds, from 122,000 in 2019 to just 43,000 in 2020, if the restrictions remain.
“The federal government is understandably focused on jobs. This vitally important report shows that our sector, which normally supports 122,000 full-time equivalent jobs, has lost nearly two-thirds of those jobs this year,” says James Sutherland, chair of Live Entertainment Industry Forum, which represents Australia’s largest live entertainment employers.
“EY’s report demonstrates that when the live entertainment industry does badly, Australia loses”
“JobKeeper has provided a lifeline for our sector, but the prospect of it disappearing in March 2021 – when the industry is likely to remain massively inhibited by key pandemic-related restrictions – is of grave concern to all industry operators.
“For our sector to operate profitably we require venues operating at full capacity, unrestricted interstate movement, and open international borders without extensive quarantine. Without those necessary conditions, the outlook is truly bleak. Given the long route to recovery, and the nature of lasting restrictions, we believe that an industry extension to JobKeeper is a fair and important next step.”
Geoff Jones, CEO of TEG, says: “EY’s report demonstrates that when the live entertainment industry does badly, Australia loses. Almost all of our revenue disappeared overnight when Covid-19 restrictions closed down the industry in March and while the return of sport with limited capacities has offset some of that impact in EY’s figures, for commercial live entertainment operators both large and small, revenue in September/October remains at no more than 10% of 2019 levels.
“A simple, targeted action that will do a great deal to help our industry is a moratorium on GST on sales of tickets to live entertainment until 30 June next year. This will help us to offset the increased costs we are incurring to make our events Covid-Safe.”
“More than 80% of people have held onto tickets for postponed shows during Covid. Australians have cabin fever – they want to entertain themselves, get the kids out of the house, and have a concert, exhibition or live experience to put on the kitchen calendar – for this year or next – and look forward to after such an awful 2020. Access to live entertainment is part of what makes the Australian lifestyle so special, which is why our industry needs and deserves temporary assistance to ensure its survival.”
“We are a very self-sufficient industry; however, we need the support of government in respect of losses incurred”
Roger Field, president of Live Nation Asia-Pacific, says: “Another simple action – which also has a precedent – is the introduction of an industry-led Live Entertainment Business Interruption Fund underwritten by government to overcome the fact that we cannot get any insurance to cover us for shows being stalled due to Covid. We are a very self-sufficient industry; however, we need the support of government in respect of losses incurred due to interruptions caused by the imposition of Covid related restrictions. This small safety net would allow us to get back to investing in our events and communities as we return safely and responsibly.
“The government has set up a $50 million Screen Australia fund to overcome this problem for the screen production sector, and it has allowed that industry to get back to work, shooting movies and TV shows. As proven by this report, event fans contribute significantly more spending in the local economy, so there’s even more value in figuring out this solution to get our shows back on the road.”
Following the preliminary findings of the report, which will be released in full this month, LEIF has now asked the federal government to urgently consider targeted measures to provide additional support to the live entertainment sector.
LEIF’s recommended industry-specific initiatives include continuation of a JobKeeper-style support program for industry employees until a full-return to live; a reduction in GST (VAT) on live event tickets; an industry-led Live Entertainment Business Interruption Fund underwritten by government; and a significant expansion of the RISE grant funding program, with a particular focus on assisting commercial, non-subsidised live entertainment operators to deliver popular live events in Covid-safe formats.
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