Culture secretary Oliver Dowden has said that the idea of a government-backed insurance scheme will only be explored once futher lockdown restrictions lift after 21 June.
Insurance companies are currently refusing to cover Covid-related cancellations, meaning festivals face massive financial losses and even risk bankruptcy if they are forced to cancel last-minute.
For months, organisers have pleaded with the government to follow other European countries and offer to underwrite Covid cancellation insurance, with criticism aimed at the lack of clarity over the issue.
During a DCMSC committee meeting, Conservative MP Heather Wheeler asked Dowden for an update on whether festivals would be offered insurance by the government.
Dowden responded by saying the UK was “well on track” for reaching Stage 4 of lockdown restrictions lifting on 21 June, and that the government would then “look at” if assistance was still needed for music festivals.
“It has to be the case first that we know [if] something can go ahead,” he said, later adding: “I don’t think it’s reasonable to expect the taxpayer to provide a full indemnity for all those events if it’s not possible for them to happen.”
However, Wheeler pointed out that this would likely be “all too late” for organisers due to the months of planning required for festivals to take place.
“This would have been a very cheap deal to have been done, because the government are confident that 21 June is D-Day... in which case, you didn’t need to spend any money on insurance,” she said. “But it’s too late for the planning for so many of these summer festivals. It’s just too late.”
“We’ve probably lost another summer,” she added.
A number of live music events, including Reading and Leeds festival in August, announced their plans to go ahead shortly after the government revealed its roadmap out of lockdown.
However, a recent study showed that more than a quarter of UK music festivals have cancelled over insurance fears, with the Association of Independent Festivals (AIF) warning that more could follow amid continued uncertainty.
Last month, the 66,000-capacity Boomtown festival, which was due to take place in Northamptonshire on the August Bank Holiday weekend, announced it was cancelled for 2021. Organisers blamed their decision on the lack of Covid-specific insurance from the government.
“There’s no safety net to support,” they said in a statement. “This means we would be gambling up to an 8-figure loss should the event not be able to go ahead due to Covid restrictions, which would put the future of the festival at serious risk.”
Paul Reed, the chief executive of AIF, said in a statement on 4 May: “For months now, we have been warning government that the UK’s 2021 festival season would be quickly eroded if they failed to back their own roadmap out of lockdown and act on Covid-related cancellation insurance. That danger is now coming to pass, with over a quarter of festivals having cancelled already this year.
“Without a safety net, independent promoters cannot begin to confidently invest in their events. They currently have no protection should a Covid-related issue result in the cancellation of their festival. If government-backed insurance is off the table, festival organisers deserve to know what government proposes as an alternative to prevent the widespread collapse of the festival season.”