Coronavirus Bill

Viscount Trenchard Excerpts

2nd reading & 2nd reading (Hansard - continued) & 2nd reading (Hansard - continued): House of Lords
Tuesday 24th March 2020 Lords Chamber

[Viscount Trenchard (Con)]

My Lords, I too offer my strong support to the Prime Minister and believe that the Government are doing the right thing to prepare the armoury, to be able to do everything they conceivably need to do to protect lives and support people whose income has disappeared in the face of this unprecedented crisis caused by the coronavirus.

There are many people who have experienced some of the symptoms and think they may have contracted a mild form of the disease but have already recovered. These people are self-isolating but wish they could be tested for antibodies so that they would know whether they have had the disease. If they know that they have, they should be free to do useful work, which they could easily find with supermarkets, on farms and perhaps in the NHS. Good testing kits are available which show a result within 24 hours or so. Can the Minister offer any advice to people in this situation and tell the House whether it is possible to arrange for such people to be tested?

I declare my interests as set out in the register. Statistics provided by the Association of Independent Festivals show that in 2018 the UK live music sector contributed £1.1 billion to the economy—an increase of 10% on 2017. The 65 festivals staged by the association’s members generated more than £386 million in revenue in 2017. In addition, festivals have a large beneficial effect on the economies of the villages near where they are held. According to UK Music’s report published last year, 4.9 million people attended a festival in 2018, a considerable increase on the 2.7 million back in 2012. Small music festival companies, many of which stage a single event every year, usually in the summer months, have been put in a particularly parlous position by the pandemic. The Government are to be congratulated on taking measures that will alleviate the financial damage to the leisure and hospitality industries, but many of these do not actually have a beneficial effect on the festival sector. Cash grants of £25,000 and £10,000 are, of course, welcome, but they do not have a major impact on the sudden and enormous negative effect on cash flow.

Festival organisers who had been planning events for this summer have seen their income from ticket sales and sponsorship completely dry up. Furthermore, festivals are still contracted to pay their artists’ deposits, which are often substantial. The business interruption loan scheme is a very welcome lifeline for the sector, but some lenders are asking directors of festival companies to pledge their personal assets. Many will be unable to do that. Will the Minister consider asking lenders to apply flexibility regarding the collateral required to cover the 20% portion that is not guaranteed by the British Business Bank? Will he confirm that it is the Government’s intention that all events businesses whose financial viability has been affected by the pandemic, whether or not they have yet cancelled or rescheduled their events planned for 2020, will be eligible to receive loans equal to the amount of financial damage they have suffered as a direct result of the pandemic?

Paragraph 5(5) of Schedule 22 empowers the Secretary of State, in exercising his powers to prohibit mass gatherings such as music festivals, to inform persons of the prohibition, but the Bill does not include any requirement to specify the duration of such prohibition, although that is the case under Clause 6, which deals with the powers to close premises. The industry needs to know when and for how long the Government intend to prohibit gatherings of more than 50 people and the process by which they will determine whether a prohibition will be extended beyond its original period.

The one measure that festival companies and other event organisers need most urgently, and which is not included in the Bill, is the suspension of the provision of the Consumer Rights Act requiring the return of monies to ticket holders within 14 days of cancellation. I was encouraged to hear the Secretary of State for Health say at a meeting on Thursday that the Government are looking at this. The German Government are considering a measure that would permit the promoter of a festival to defer refunds until the end of September but containing a review clause that could extend this break until 30 July 2021. I have also heard that in Italy a new law has been enacted that allows promoters of festivals to issue vouchers for future events instead of refunding cash. The Bill may not be the right place, but will the Minister inform the House whether the Government will introduce legislation to this effect?

Some noble Lords may dislike restricting consumer protection in this way, but it would, paradoxically, serve to protect consumers’ interests. If no relief is given to the 14-day refund rule in the very near future, it is likely that many small festival companies will be insolvent and will liquidate, meaning that the ticket holders would receive nothing back at all. This would also have a devastating effect on the income of artists, many of whom are self-employed freelance workers who do not benefit under the salary support scheme.

It is very welcome that this scheme will alleviate the problems faced by festival businesses that have no cash flow to pay their staff. Will the Government consider a London weighting provision for the threshold of £25,000? What are the Government’s plans for those whose salaries exceed the threshold?

Extraordinary times require an extraordinary response. I am confident that the various schemes introduced by the Government could alleviate the financial difficulties that will be faced by very many. I earnestly hope that access to the schemes will not be unreasonably restricted by bureaucratic and onerous conditions.