UK Music chief urges Chancellor to use Budget as "huge opportunity" to boost growth in the music industry

09 March 2020 - Press release

 

UK Music's Acting CEO Tom Kiehl has written to Chancellor Rishi Sunak with a four-point plan to boost growth in the music industry ahead of his March 11 Budget.

He highlighted how the Budget presented the newly appointed Minister with a "huge opportunity" to further boost growth in the music industry which contributes £5.2 billion a year to the UK economy. 

In his letter (below), Mr Kiehl praised the Government for making "great advances" in fulfilling its manifesto pledge to extend business rate relief to support grassroots music venues.

But he highlighted the vital importance to the industry of the Government's ability to secure a post-Brexit trade deal and ensure the UK maintained its world-leading standards in copyright protection. 

He urged the Chancellor to adopt a four-point plan in his Budget to maximise the potential of the music industry that sustains more than 190,000 jobs in the UK and generates exports of £2.7 billion. 

The UK Music chief said the Government should act in four key areas - fiscal incentives, international trade support, shared parental leave and rehearsal rooms.

On fiscal incentives, Mr Kiehl said: "The UK music industry believes a focused fiscal incentive could pump-prime the capital market for music investment, thereby invigorating the digital opportunity for UK music creators and putting them on a more even footing with their international competitors.

"Such an incentive would also enable labels and publishers to take on further risk in backing additional investment in a broader range of innovative talent, expanding the base of original content that we have to export, and establishing the UK as the world's highest quality and most favourable music production ecosystem."

On rehearsal rooms, he urged the Government to expand and enhance the opportunities these spaces offer to young people.

Mr Kiehl said: "Talent is everywhere but opportunity is not. Socio-economic circumstance should not create barriers for participation in music."

On shared parental leave, he reiterated UK Music's call for the Government to update shared parental leave and pay rules to include self-employed parents as part of the #SelfieLeave campaign.

Mr Kiehl said: "The current inflexible system is holding back equality in the music industry, where 72% of all workers are self-employed.

"At present, there is no shared parental leave and pay system in place for self-employed parents. The current system of Maternity Allowance for the self-employed places the entire burden of childcare onto the mother and offers no financial support for self-employed fathers or same sex partners wanting to share some or all of the childcare."

On international trade, Mr Kiehl called for the renewal and extension of the highly successful Music Export Growth Scheme (MEGS) to help UK artists grow their audiences abroad.

Mr Kiehl also called on the Chancellor to allay industry fears about coronavirus and its potential impact on the economy, as well as public health. 

Mr Kiehl said: "There is a need for continued regular communication with the sector in this fast moving situation, as well as consideration of financial support to ensure festivals, concerts and music businesses can get through potentially challenging months."


--------------------

The Right Hon Rishi Sunak

Chancellor of the Exchequer

1 Horse Guards Rd, 

Westminster, 

London 

SW1A 2HQ

 

March 06, 2020

 

Dear Chancellor,

On behalf of UK Music, the umbrella body for the commercial music industry, I congratulate you on your recent appointment as Chancellor of the Exchequer. I am writing in anticipation of your forthcoming Budget. The Budget presents a huge opportunity to introduce a package of measures which will help stimulate further growth in our music industry.

Since the General Election, the Government has already made great advances in fulfilling its manifesto commitment to extend business rate relief to support grassroots music venues but there is still much more we can do together.

 

Recent success of UK music industry

The UK music industry is worth £5.2 billion to the economy, generates exports of £2.7 billion and employs over 190,000 people. Live music alone is now worth £1.1 billion to our economy with a 10% increase in the number of overseas visitors coming to the UK for shows and festivals.

Ed Sheeran is the biggest-selling touring artist in the world, with the “Divide Tour” now officially the highest grossing tour of all time. He was also the second most successful recording artist in the world last year. 

Billboard magazine recently revealed that the O2 Arena in London was the most successful music venue in the world over the past decade, with the Manchester Arena also in the top five.

In nine of the last 15 years, the biggest-selling album in the world has been from a UK artist. When the end of year charts come out we expect 2019 to deliver similar successes. Lewis Capaldi recently reached number one on the Billboard Hot 100 in the US. This year has also seen fantastic debut albums from AJ Tracey, Mabel, Sam Fender and Tom Walker.

We continue to be a world leader in all genres – from jazz to folk and grime. We are home to studios that record sensational box office film scores and soundtracks, as well as home to many of the most accomplished orchestras in the world. The success of the supremely talented Sheku Kanneh-Mason also shows we keep producing the best classical music performers.

 

A Package of Measures

UK Music fully supports the need to secure a Comprehensive Free Trade Agreement between the UK and EU. Our priorities for this relate to ensuring cultural exchange can be maintained without new bureaucracy and expense, as well as guaranteeing that we have the highest standards of intellectual property protection in the world. We also welcome the opportunity that leaving the EU presents to achieve new trade agreements across the world, including with the world’s biggest music market – the USA.

In order to maximise the potential of the music industry there are four specific measures which we believe will have great benefit that we ask you to consider in your forthcoming Budget –

 

1. Fiscal Incentives

The UK music industry believes a focused fiscal incentive could pump-prime the capital market for music investment, thereby invigorating the digital opportunity for UK music creators and putting them on a more even footing with their international competitors. Such an incentive would also enable labels and publishers to take on further risk in backing additional investment in a broader range of innovative talent, expanding the base of original content that we have to export, and establishing the UK as the world’s highest quality and most favourable music production ecosystem. We request Government support for a process involving the Treasury, DCMS and industry to develop this further.

 

2. Rehearsal Rooms

Talent is everywhere but opportunity is not. A total of 17% of music creators were educated at independent schools, compared to 7% across the population as a whole. Around 50% of children at independent schools receive sustained music tuition, but the figure is only 15% for state schools. Socio-economic circumstance should not create barriers for participation in music. UK Music currently runs a rehearsal spaces scheme which supports practice rooms and studios in low-income areas. UK Music currently supports 23 spaces across the UK. UK Music would like to work with the Government to expand and enhance the opportunities these spaces offer to young people. 

 

3. Shared Parental Leave for the Self-Employed

We ask the Government to update shared parental leave and pay rules to include self-employed parents as part of the #SelfieLeave campaign. The current inflexible system is holding back equality in the music industry, where 72% of all workers are self-employed. At present, there is no shared parental leave and pay system in place for self-employed parents. The current system of Maternity Allowance for the self-employed places the entire burden of childcare onto the mother and offers no financial support for self-employed fathers or same sex partners wanting to share some or all of the childcare. 

 

4. International Trade Support

Global success relies on UK artists being able to grow their audiences abroad. The Music Export Growth Scheme (MEGS) - established in 2013 and administered by the BPI and PRS Foundation’s International Showcase Fund (ISF) allow this to happen. Both schemes are supported by the Department for International Trade. Government funding for these schemes should be renewed and extended further.

Finally, a request on COVID-19. The global outbreak of coronavirus has created concern amongst our members, particularly those who are heavily involved in organising and participating at live music events. They are fearful of the impact this will have on music businesses. We are grateful for the Government including UK Music in a call on Monday 2 March with the Deputy Chief Medical. There is a need for continued regular communication with the sector in this fast moving situation, as well as consideration of financial support to ensure festivals, concerts and music businesses can get through potentially challenging months.

 

Yours sincerely,

Tom Kiehl

Acting CEO, UK Music