The government pot will allow organisers to plan events for Q3 and Q4 2021 without the financial risk posed by a potential Covid outbreak
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€1.9bn will go towards compensating losses incurred by reduced-capacity events, while a further €0.6bn, available from September, is allocated specifically to insurance
By Manfred Tari on 27 May 2021
The federal cabinet of the German government has finally launched a fund of €2.5 billion dedicated to supporting cultural events. Details of the fund, first announced last December, were spelt out during a joint press conference held yesterday (26 May) by Olaf Scholz, minister of finance, and Monika Grütters, minister of state for culture and media.
Divided in two supporting strands, the special fund should enable concerts, theatre performances, cinema shows and other cultural events to start up again. At €1.9bn, the biggest tranche is dedicated to compensating financial losses for live events held under capacity in order to meet Covid-19 restrictions. A further €600 million is allocated for an insurance fund to cover losses incurred by the cancellation of events and shows which are called off due to the pandemic.
Scholz, in his position as minister of finance, is the main originator of the fund. Politically this is a notable move, as the development of such a tailor-made measure would usually be the responsibility of either the state ministry for culture or the ministry of economic affairs.
In fact, political manoeuvring behind the scenes is one of the reasons why it took so long for the fund to be officially launched. Finally, after the intervention of the Federal Chancellery, it is Monika Grütters who now takes the lead on a steering committee for the fund. The administration and financial handling of the fund has been transferred towards the culture ministries of the German states.
While the main terms and conditions of the core elements of the fund are already defined and agreed, there are some minor details still under development.
From September onwards, promoters of events with more than 2,000 visitors are able to access the insurance element of the special fund
The biggest chunk is dedicated to providing economic aid for promoters in the cultural sector. This tool is expected to be launched from July onwards and last until the end of the year. Starting first with events up to a capacity of 500 people, promoters can apply to receive compensation for unsold tickets when the number of attendees is reduced by at least 20% due to pandemic restrictions. For each ticket sold, the organisers receive the same ticket price again as a subsidy.
From the beginning of August, promoters of events up to 2,000 people are also eligible to benefit from the fund. In the case of very strict hygiene requirements and a limit on the number of participants up to 25% of maximum capacity, the subsidy may increase to the amount of twice the ticket revenue. However, the subsidy is limited to €100,000 per event.
From September onwards, promoters of events with more than 2,000 visitors are able to access the insurance element of the special fund. In the case of a cancellation, a reduction in the number of participants, or a postponement of the show due to the pandemic, the cancellation fund will cover a maximum of 80% of the cancellation costs incurred. The maximum amount of compensation is €8m per event.
Promoters are asked to register their events upfront on a central online portal, which will be created operated by official sources in Hamburg. A central help desk for information and consultation will be located in North Rhine-Westphalia.
Closely involved in previous consultations regarding the development of the fund have been, among others, Dr Carsten Brosda, senator for culture in Hamburg; Wolfgang Schmidt, state secretary in the ministry of finance; Alexander Schulz, managing director of Reeperbahn Festival; and Stephan Thanscheidt, CEO of FKP Scorpio and board member of the German promoters’ association, BDKV.
This article forms part of IQ’s Covid-19 resource centre – a knowledge hub of essential guidance and updating resources for uncertain times.
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