UK Music calls on Chancellor to end “nonsensical” discrimination against venues over business rates

UK Music leads plea from MPs and Peers for Chancellor to use Spring Statement to end “nonsensical” discrimination against grassroots music venues over business rates.

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11/03/2019: A cross-party group of 59 MPs and peers have written to Chancellor Philip Hammond urging him to think again over a business rates’ shake-up that discriminates against grassroots music venues.

UK Music CEO Michael Dugher and Labour’s Shadow Culture Minister Kevin Brennan with Chancellor Philip Hammond at a meeting in February

In their letter, the members of the All-Party Parliamentary Group (APPG) on Music calls on the Chancellor to use his Spring Statement on Wednesday March 13 to ensure music venues benefit from the new business rates retail discount scheme.

The group includes Shadow  Culture Secretary Tom Watson, former Conservative Culture Minister Ed Vaizey, Baroness Bonham-Carter (Liberal Democrat spokeswoman on Digital, Culture, Media and Sport in the House of Lords), and MPs from all parties including members of the influential DCMS Select Committee.

The 2017 business rate revaluation has amounted to a 31 per cent increase in business rates payable by grassroots venues.  The huge hike comes after figures from the Music Venue Trust showed that 35 per cent of grassroots venues have closed over the past decade.

The retail discount scheme, as announced in the 2018 Autumn budget, currently discriminates against grassroots music venues by stating that they “are not similar in nature” to pubs and clubs.

The APPG on Music warn the Chancellor that grassroots venues are a vital part of the ecosystem of the music industry which contributes £4.5bn a year to the UK economy and need the support of the Government.

In their letter, the politicians warn the Chancellor:

“Small grassroots music venues gave our biggest musical exports, including Ed Sheeran, Adele, Sam Smith and The 1975, their start. Our ability as an industry to develop future talent is put at risk if they have nowhere to nurture their talent.

The modest change to the guidance that we are asking for would cost just over £1 million over two years, benefiting 124 venues in the process, and would provide much needed help to grassroots music venues that operate at very low margins.

By protecting music venues we protect our rich musical heritage as a nation, and plan for a future where UK music will only grow in popularity and remain the envy of the world.”

The intervention by the APPG on Music, led by APPG chairman and Conservative MP David Warburton, comes after UK Music CEO Michael Dugher and Labour’s Shadow Culture Minister Kevin Brennan raised the issue at a meeting with Mr Hammond in February.

The discrepancy over varying business rates is massive.  For example, Arsenal Football Club enjoyed a 7% cut in its business rates on its Emirates Stadium as a result of a revaluation in April 2017, while the nearby Nambucca music venue has been subject to a 44% per cent increase in its rateable value.

The rate hike means some venues such as The MacBeth in east London have endured a rate hike of £20,496 – a huge increase of 806%, taking their current business rate to £23,040.

UK Music CEO Michael Dugher said:

“It’s nonsensical to classify grassroots music venues as being ‘not similar’ to pubs and clubs.  The revaluation of business rates officially discriminates against these venues and we hope the Chancellor will listen to cross-party MPs and rethink this flawed policy.

“Grassroots venues are an essential part of our brilliant and diverse music industry that contributes £4.5bn a year to the economy.   Piling the pressure on them with huge rent hikes just means more will face the threat of closure – something that could cause incalculable damaged to the music industry’s talent pipeline.

“The Government talked a lot about the need for an industrial strategy.  Here’s a chance to put words into action”.

APPG on Music chairman and Conservative MP David Warburton said:

“As chair of the All-Party Parliamentary Group on Music I’ve campaigned on a number of issues to keep our grassroots music venues open. 35% have closed over the past decade with rising business rates often being a leading cause. The Chancellor’s Spring Statement is an enormous opportunity for the Government to get behind music and put in place measures to ensure rate relief benefits the most vulnerable venues in our communities. This opportunity really must not be missed!”

M magazine

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