Oireachtas Joint and Select Committees
Tuesday, 30 June 2020
Special Committee on Covid-19 Response
Impact of Covid-19: Arts and Entertainment Sector
We are joined by representatives from the National Campaign for the Arts, NCFA, the Event Production Industry Covid-19 Working Group, EPIC, and the Event Industry Association of Ireland. From committee room 1, I welcome Ms Angela Dorgan, chair of the steering committee, and Ms Aideen Howard, member of the steering committee, from the NCFA; Ms Sophie Ridley, chairperson, and Mr. Shane Dunne, deputy chairman, from the Event Production Industry Covid-19 Working Group; and Ms Elaine O'Connor, joint co-founder, and Mr. David Mongey, industry representative group member from the Event Industry Association of Ireland.
I wish to advise our guests that, by virtue of section 17(2)(l) of the Defamation Act 2009, witnesses are protected by absolute privilege in respect of their evidence to the committee. If, however, they are directed by the committee to cease giving evidence on a particular matter and they continue to so do, they are entitled thereafter only to a qualified privilege in respect of their evidence. They are directed that only evidence connected with the subject matter of these proceedings is to be given and they are asked to respect the parliamentary practice to the effect that, where possible, they should not criticise or make charges against any person, persons or entity by name or in such a way as to make him, her or it identifiable. We expect witnesses to answer questions asked by the committee clearly and with candour, but witnesses can and should expect to be treated fairly and with respect and consideration at all times. If witnesses have any concern in that regard, I ask that they raise it with me.
I invite Ms Dorgan to make his opening statement and ask that he limit it to five minutes as a copies of it were circulated to members in advance.
Ms Angela Dorgan:
The NCFA represents the more than 54,000 artists, arts workers and arts organisations that make up Ireland’s internationally acclaimed, innovative and intelligent arts ecosystem. We represent the makers, organisations, theatre companies, producers, colleges, venues, arts centres, galleries and publishers. For a series such as “Courage”, for example, there are festivals, showcases and organisations that support the musicians to that level, while for a show such as “Normal People”, there are theatre groups and venues where those actors and directors cut their teeth and hone their skills. A young, unknown like Sally Rooney can access a grant to write a great work. The NCFA speaks and plans for both the tip of the iceberg and the many crucial layers of ice that lift that tip out of the water.
The Covid-19 crisis has created profound challenges for the arts and culture sector that have compounded years of under-investment. Throughout April and May, the NCFA engaged in cross-sectoral consultation with artists, arts workers and the resource organisations that work with them. On 27 May, the NCFA published a national recovery plan for the arts containing 13 actions essential for the survival and recovery of the sector. The first and most urgent of these goals was achieved on Bloomsday, when the Government announced emergency funding of €20 million for the Arts Council to enable artists, arts workers and arts organisations to survive the Covid-19 crisis.
This commitment is a positive first step in recognising the value of our arts community. Coupled with the acceleration of the reopening of theatres, galleries and venues, this investment represents new hope for arts workers in Ireland. However, social distancing measures will continue to mean that events and gatherings are simply not viable. Organisations are losing €2.9 million in revenue per month of shutdown. To address this, the NCFA asks that the pandemic unemployment payment for freelance artists and arts workers be extended until arts and cultural events resume.
The publication of the report by the Arts Council Covid-19 expert advisory group, of which the NCFA was a member, is very welcome but we now need a commitment from the Government to allocate the €30 million necessary to the Arts Council in 2021 to allow this plan to be delivered. Many arts organisations are also charities that have active fundraising programmes to supplement their activities annually. The recent Benefacts study shows that charitable fundraising has been decimated to the tune of €500 million. We call on the Government to reform our tax regime to incentivise and encourage charitable giving and to keep arts organisations in business and to keep Ireland competitive in this area.
Local authorities play a vital role in the cultural infrastructure. Local festivals and arts centres are sustained through partnership and with local authority investment. We are calling on local government to protect these arts budgets in order to ensure that local activity can resume and begin to be rebuilt.
Even prior to the Covid-19 crisis, 72% of artists earned less than the national minimum wage. The new Government has a unique opportunity to introduce a model of universal basic income for all citizens beyond the scope of the pilot scheme set out in the draft programme for Government. We need urgent, positive action to invest in artists, arts workers and arts organisations as equal members of society who can rebuild a healthy sustainable arts sector for the benefit of all of Ireland.
Mr. Shane Dunne:
I thank the committee for the opportunity to speak to it today on behalf of EPIC. Members may not know who we are. That is not surprising; the live event industry has prospered for decades with little State intervention and no State aid. We have never needed the State's help before. We have never received funding from the Arts Council or any Department with responsibility for arts or culture. Live events continue through wars, they raise money to help in times of famine, they raise the spirits of a nation in times of need, and they provide a focus in times of celebration. We are, and should be, invisible. If we have done our job well, performers will never know we were there. They just walk on stage and speak into a microphone, with the lights shining on them, the autocue lined up, and the cameras rolling, at an Ard-Fheis or other event, and their words appear on the RTÉ news that night. We must retain the skills built up in our sector in order to maintain that standard of service to Ireland. Now, however, we are in a crisis created by the restrictions required to fight the Covid-19 pandemic. The industry we love so much is on its knees. Never in the history of staging live performance and events has there been such a sudden and total stop to work in Ireland as happened on 12 March 2020. Now we need to step out of the shadows backstage and shine a light on our needs; no longer can we afford to be invisible.
Please do not confuse us with the funded arts. We greatly welcome the funding recently administered through the Arts Council but that funding will not make its way to the businesses and staff supported by this working group. The non-funded live entertainment and arts sector accounts for a vast multiple of both ticket sales and turnover by comparison with the funded sector. This is a much bigger business.
This past weekend should have been one of the busiest our industry has seen. In excess of 500,000 people would have been attending events from those at Marlay Park and Live at the Marquee to those at Malahide Castle and Irish Independent Park, to name but a few. The vast majority in the events industry work in annual cycles. The sector has lost an entire year's turnover, not just that of a few months. This was lost when most financial reserves were at their low point leading up to St. Patrick's Day, the start of the usually busy summer season.
The live entertainment industry is a business of innovators, entrepreneurs and creators. We are commercial, profit-making entities, and we are happy with that. We risk our own money to build businesses. These businesses span the length and breadth of the country. Some 65% of them are based outside the greater Dublin area. Among them are businesses such as: Made for Stage in Limerick, Event Power in Thurles and Donohue Marquees in Carlow; venues such as Róisín Dubh, the Spirit Store, Cyprus Avenue and the Gleneagle INEC Arena; and festivals such as Sea Sessions in Bundoran and the Vodafone Comedy Carnival in Galway.
This industry touches every part of the island. Our reach is far and our actions are seen worldwide; the process leading to Ireland's seat on the UN Security Council started as a comment during a U2 show and visits of United States President Barack Obama, the Pope, and, historically, the Queen of the United Kingdom were all facilitated by our industry. All over the world, the Ireland brand is sold using the festivals, events and entertainment provided by our industry and the funded arts community.
The funded sector is starting to see supports provided and now the non-funded sector must be addressed too. Events keep both local and national community spirit alive, from vintage steam rallies to the St. Patrick's Day festival, and from the National Ploughing Championships to the Electric Picnic festival. Unless workers are protected and skills retained, the sector will not be able to play its valuable and considerable part in rebuilding Ireland’s spirit and economy.
We are an integral part of the cultural fabric of society. The live entertainment industry is an ecosystem and all aspects are needed for it to survive. We should consider the talent of the artist, the venue or the promoter and the contractors and crew to pull it all together. For every €1 spent on a ticket in Ireland, there is €6 spent as a result in the wider hospitality and tourism sectors. Live events were directly responsible for over 3 million bed nights per year, according to the latest pre-Covid figures.
In the past, in running a large scale event in Ireland, we had to look abroad but we do not do that any more as we have an indigenous workforce here that is the best in the world. World tours start here because the artists know that the people they will work with are highly skilled. Just last Friday, as part of Comic Relief, Hozier, a brilliantly talented Irish artist, stood on the pitch in Croke Park to give a performance that is now being lauded worldwide. It had an Irish lighting company, an Irish lighting designer and an Irish director.
For decades, when money was needed to be raised for a charity, we were asked to help. Now, for the first time, we must ask for help and support. We were one of the first industries to shut and we will be the last to return to full capacity. This is why we are asking for the supports in our submission.
This is an industry filled with people who have forged their own path, highly skilled and dedicated people who invest their own time and their own money to create events and experiences to allow others to make memories that will last a lifetime. The people who work on live events understand, probably more than most, the requirement to keep the public safe. It is what we do on a daily basis through every action and decision we take. We depend on the well-being and happiness of our audiences to pay our wages. We are not asking for a hand-out but we do need some help now so that in turn, we can drive the rebirth of our economy by recovering the spirit and optimism of the nation. I thank the committee.
Ms Elaine O'Connor:
I thank the committee for the invitation to attend today to engage with it on reopening the economy with regard to the arts and entertainment sector. I am a co-founder of the Event Industry Association of Ireland, EIAI. Established in 2013, the EIAI was founded by a group of event practitioners and industry experts with the aim of improving the overall event industry in Ireland. Attending with me is Mr. David Mongey, managing director of Mongey Communications, a core service provider to the industry for over 40 years.
We are here today representing an estimated 45,000 workers and an industry that annually generates in excess of €3.5 billion for the Irish economy and €850 million for the Irish export market. At the immediate onset of Covid-19, the event industry suffered disproportionately to all other sectors and we now need to prepare for the long-term implications of dealing with Covid-19 into 2021 and potentially beyond.
The Arts Council of Ireland, Fáilte Ireland and Tourism Ireland, as well as local authorities and development agencies all over Ireland, have identified the strategic importance of festivals and event in their strategies for at least the past 20 years. The event industry underpinning these events of strategic national importance is unique, intricate and often misunderstood. Our "front of house" comprises a bustling calendar of events, world-class entertainment and a kaleidoscope of sporting, business, corporate, leisure, cultural and social experiences. This often distracts from the ecosystem behind the scenes. Here one will find an industry powered by resilience, determination and devotion to the promotion of our arts, business, culture, heritage, innovation and tourism sectors, while supporting the national economy and, most crucially, delivering experiences that exceed expectations, entertain, connect communities and enhance our attendees’ quality of life.
We are grateful to the Government and commend it on its prompt and effective application of valuable supports that immediately provided a degree of comfort across our industry. We are, however, filled with apprehension when considering our industry's ability to generate income while we await the lifting of restrictions. With no definitive start date and the knowledge that even when the date arrives, our industry will not be able to resume business as usual, we understand there will be slow but steady progress.
The public health safeguarding measures implemented by the Government to date and the anticipated duration of these measures, while absolutely necessarily, essentially mean the majority of our businesses, organisers and workers are simply unable to generate revenue now and for the foreseeable future.
The situation is unprecedented and absolutely devastating. The Irish event industry, usually an extremely ambitious, active and competitive industry, is facing a prolonged hibernation period which has already affected our entire ecosystem on a short, medium and long-term basis.
In addition to the impact on businesses, Covid-19 has resulted in the loss of livelihood and potential loss of industry-specific skilled workers who may abandon employment in the industry in the future. It is important to note that many of the specialist roles required in the event industry are highly skilled and industry-specific and were in high demand and short supply coming into this crisis. Due to the seasonal nature of the industry, with January and February being notoriously quiet and inactive, a large portion of our workforce had not yet been employed and, as such, did not qualify under the temporary wage subsidy scheme.
As with a large segment of workers, artists, performers and entertainers excluded, many festival events and cultural activities also sit outside the remit of Arts Council and Fáilte Ireland funding criteria, therefore, the support package allocated to the Arts Council and Fáilte Ireland will not and could not adequately filter down through the industry ecosystem. We are calling on our Government to: recognise that this sector is one of the last remaining sectors that has not been provided with a pathway to or a date for reopening and, as such, requires a unique suite of supports, and that, as part of this process, the additional funding provided to the Arts Council will at best reach only a portion of our sector; recognise the event industry in its own right to acknowledge it for the valuable economic sector it is, assign direct responsibility for it to the Department of Jobs, Enterprise and Innovation and immediately establish an event industry task force to engage with and support the industry to deliver a roadmap on future sustainability; continue the temporary wage subsidy scheme for our sector until such time as restrictions with regard to mass gatherings are removed; protect and support each part of our sector - our workers, volunteers, performers, venues, SMEs, promoters, our smorgasbord of community events right up to our national hallmark events and our stakeholders - to ensure that our ecosystem endures and that our professionalism, expertise and vital skill sets are retained; enable and resource the event industry to utilise this recovery period to address the new challenges presented by Covid-19; and improve industry best practice, standards and professional competency, safeguarding our ability to deliver a safe and successful future.
I thank the committee for the opportunity to discuss these issues. My colleague and I are happy to take questions from the members on this matter. I request that they turn to page 2 of our submission as we will be referring to it in the question-and-answer session.
Go raibh maith agat agus go raibh maigh agaibhse ar fad sa seomra eile. We have had three very different presentations but they are linked together in the commonality of the arts sector in Irish society and the industry that supports it, which is State-funded to some degree, and those who have been totally reliant on their own funding. I want to thank the witnesses for attending and for alluding to some of the problems that exist. That is all they could do in their short presentations but there is a much bigger submission from each of them, which highlight some of the issues. I am aware of some of those issues because I come from a family of artists and musicians. My mother is a sculptor so I have some idea of what goes on in the art world but, in particular, with the brothers who are musicians, what goes on behind the scenes when organising events.
All of us have seen the cancelled concerts and events over the years, especially in the past six months because of Covid-19. We might have bought a ticket for an event and feel downhearted that it is not going ahead but behind every one of those events is a huge array of people - stagehands and other production crew - and sometimes we forget about them. All of those individuals are very skilled but they are also in a precarious position because if events do not happen, they often do not get paid. We tend to forget that so. It is timely, therefore, that the witnesses have come before us, especially in view of the fact that the arts sector - and that encompassing event management and production - will be one of the last to recover.
"Recovery" only means coming back to the level the sector was at beforehand. Ms Dorgan said 72% of artists survive on less than the minimum wage. Hopefully the sector will recover to a condition much better than what existed before, with better appreciation than before.
I would like to ask a few questions. I hope the three witnesses can cover these queries in their replies to me or to others. Since the live events and arts sectors will be the last to recover, is now the time to set up an industry task force to look at the best ways to develop supports and encourage the decision to provide for the industry? This would apply not only for the next few months but for the next year, in the hope that by this time next year the industry will have fully recovered.
The Event Production Industry Covid-19 Working Group, EPIC, mentioned the question of VAT in its submission. The VAT rate on labour in this industry is 23%, while in other sectors it is 13.5%. Has there been any support for a reduction from the Department of Finance? How much would the industry save if VAT was reduced? Do the witnesses have a figure for the amount of VAT paid by this sector annually?
The events and arts industry is worth €1.3 billion. That was mentioned in several submissions. That shows it is a thriving and viable industry. Can the witnesses see it recovering to that level within a year, or will it take several years? How has the Department responded to the need to work towards that and retain the requisite skills?
Ms Angela Dorgan:
I would be happy to take one of those questions. There has been a very open and positive conversation with the Department. I will let my colleagues talk about VAT because they have been briefed on it much better. It would be really useful to immediately set up a cross-departmental task force like the one called for in the report of the Arts Council of Ireland. It would allow this sector to contribute to the July stimulus package. We all want to see the Covid-19 pandemic unemployment payment extended. A conversation about VAT as part of that stimulus package will be essential for both our sector and the wider tourism and hospitality sectors.
Mr. Shane Dunne:
The Deputy asked two questions that were probably directed to the Event Industry Association of Ireland, EIAI, and us. We do not have a figure for the total VAT paid. EPIC represents about 2,000 SMEs and sole traders within the industry. A lot of the work they do is for smaller community events. They do a lot of work for Government agencies like Fáilte Ireland and businesses that are not VAT-registered. Having to charge 23% on top of their own fees makes them more expensive and they generate less work as a result.
Regarding the Department's response, I note that EPIC is a reasonably new group. It is six or seven weeks old. We have had initial discussions with the Department and we expect to sit down with Fáilte Ireland in the coming weeks. We do not have what the hoteliers, the vintners and everyone else have, namely, a roadmap. We do not yet have an outline from the Government. We are available, as I am sure Ms Dorgan and Ms O'Connor are, to sit down with anybody and put that roadmap together, but we do not have one right now. Things will be difficult until we get one.
The Deputy asked if the industry will recover. There is a 100% chance it will. Every submission made today includes the word "innovation". The reason for that is that this is a business of innovators.
That is what we do. We adapt on site on a daily basis, be it in a theatre or a green field. The industry will recover but we need to sustain it so that we can retain staff with the necessary skill sets until the recovery happens.
Mr. David Mongey:
The weekend that has just past would have been hectic in the event scene in non-Covid-19 times. I would have had a team of approximately 60 highly skilled people working. I congratulate the Government on the payment scheme that has kept my staff together even though they are not working. Our business will survive but we do not want to lose any of the people with the necessary skill sets and that is a possibility if the scheme runs out. People in this industry have an enormous skill set, and the passion, knowledge and enthusiasm to do a successful job. As I have already mentioned, these people are never before the stage, they are always behind the scenes. I congratulate that team of people. This country does not want to lose those highly skilled people because they are vital to the industry.
I am taking five minutes. I will follow up on the last question that was asked. It is an awful thing to be saying to people but, unfortunately, this industry group and its representatives face a big problem because of the health regulations and attitudes of the public to the types of events with which our guests are involved. It is optimistic to believe that there will be any substantial change between now and this time next year. It is going to be a longer process of recovery.
Before the start of this session, I noticed an announcement from New York that there might be no theatres reopening this year. That is a stark decision.
Allowing for the fact that it is going to be a longer process of recovery, what are the key things that our guests want to see the Government to do from July onwards? While a reduction in VAT would help in a trading situation, it is not as important when no business is being done. What are the key things that will enable our guests to deal with a situation where it could be at least another 12 months before there is a meaningful return to large-scale public events? The health guidelines might not change until we have a vaccine of some sort or appropriate medicine. What do our guests need from the Government to keep this brilliant industry intact and be ready to go when the turnaround comes? I do not know which of our guests would like to come in first on that question.
Ms Aideen Howard:
I would be delighted to take that question. As my colleague, Ms Angela Dorgan, mentioned earlier some of the immediate and urgent requirements of the sector would be addressed through the extension of the pandemic unemployment payment for the remainder of the year. The Deputy rightly points out that we need long-term action. Within our submission, we are calling on the Department to build on the great work that has been done for the Arts Council and commit to allocating €30 million for next year to allow the Arts Council and the funded art sector to sustain itself and survive.
In addition, the reform of the tax regime and incentive change that we are looking for would allow arts organisations that are very busy fundraising all the time to try to better address the deficits that they will experience in other sectors of their businesses.
At the same time, we know that local authorities and regional development are equally important to the survival of the sector. This is not just about funding from central Government. The local authorities play a massive role in the local arts scene of all the constituencies represented by the committee members.
In the context of local arts funding in local authority budget lines, whether it is for venues, the arts centres of Letterkenny, Bray, Siamsa, Dún Laoghaire or wherever, we would be very keen that those budget lines are ring-fenced and protected, not just now in 2020 when there is a crisis but right into 2021.
Finally, in the longer term we are looking for the pilot promised in the programme for Government for universal basic income to be expedited and expanded beyond what is promised in order that individual artists and arts workers can consider some viable future. As the Deputy suggests, even when arts organisations like my own can reopen, we will be doing so at a capacity of 15%. This will make matters very difficult to be viable for many months to come.
On the commercial side - on the EPIC side - I have seen the submissions and appreciate the range of issues. So many of the members and the type of people who provide the services EPIC is involved with are small, really get-up-and-go companies and self-employed individuals who work on events. If there were one or two key things that we, as a committee, would be recommending to Government, based on the fact that this could take quite a long time, what would EPIC like to see us recommend?
Ms Sophie Ridley:
I hope Deputy Brophy is not right about how long it will take but I have a fear he may be. We need to keep our members alive and well enough not to have to take jobs in other sectors, so that when we go back to work we will have the skills we have taken so long to build up. For our individual members, that is to keep the Covid payments going until we go back to work. It is support from the banks for their loans and mortgages. For our SMEs, it is grants to help with the rent and rates and a reduction in or a holiday from commercial rates in order that we can pay for warehouses full of equipment. We have already addressed the question of VAT.
If I may go back to the question about the local authorities and their funding, in spite of the fact that it is local authority funding, it will now have to come from central government too because the local authorities are challenged. In Kilkenny, I am acutely aware of the great role the arts and the network relating to arts projects, festivals and so on play in the economy. Through the local authorities, there needs to be a substantial input of funding from central government to support festivals such as the Arts Week and Rhythm and Roots and events centres such as the Watergate Theatre in Kilkenny. A range of supports available through the local authorities will be challenged due to the financial circumstances of those authorities. It will be for central government to come in and act on that. I would hope that in highlighting their case to Departments, the witnesses would think of the fact that funding there has dried up and it is absolutely critical that it be replaced with direct funding input from central government. I mentioned the Watergate Theatre, which is being used for virtual performances and so on. That type of innovation also needs to be supported.
In terms of the Arts Council, the figure of €20 million was mentioned. The council is seeking €30 million for 2021. Has it factored into that request the fact that an awful lot of what happens in the world of art will really not pick up at all until the middle or end of next year? What has been the response of Government to that predicament?
Ms Angela Dorgan:
Directly speaking to the Arts Council's €20 million, I sat on the advisory committee on behalf of the National Campaign for the Arts. I refer to how that €20 million breaks down, which takes me back to Deputy Brophy's question on how we will continue.
A big chunk of that funding from the €20 million will go directly to artists to make work to present, and I mean festivals, stages and people who work in theatres. It is very important that there is artists' work to present. The Arts Council has ring-fenced €9.2 million for individual artists, writers, theatre makers and musicians, which is welcome. There is a substantial fund to help arts organisations to adapt to an online world. There is also an ask that the Government work with the European Commission on Article 13 to provide fairer pay to artists for online work because that is where a lot of them are being driven to make a living. There is a European-wide campaign that Ireland has contributed to and there are activities like that, which can help. A substantial other fund from the Arts Council will be spent on helping local arts centres and venues to adapt to Covid as we start to come back.
To reply to Deputy Brophy, EPIC, and I am sure Ms O'Connor, would agree we are the sector that will coax everybody out. Our sector kept everybody company when they were in isolation during Covid. It is up to us and the skills in the entire sector, which we cannot afford to lose, to coax people out so that a return to normal happens quicker.
What about the response by Government in terms of providing the necessary funding? In the context of not being able to get back fully until mid or late 2021, it is important from the figures that have been presented that they reflect the possibility of a longer recovery for the sector. There is a need to support EPIC and the other parts of the industry that act behind the scenes. I hope that the figures are big enough, in presenting to Government, to capture that possibility.
Mr. Shane Dunne:
We are 100% behind the funding that has gone to the Arts Council but that is for the funded arts sector. The non-funded sector, in turnover and ticket sales, is substantially bigger.
The Deputy asked what was the Government's response to the sector. Right now we have a wage subsidy scheme that will last until the end of August, which is the response that we have had from the Government. He asked about long-term recovery. If the payment does not extend until we are back to something like capacity we will not have a long-term recovery because the people and the skillsets that we keep talking about will leave this industry. They are the big asks. There will be little bits of work and venues will be at reduced capacity. Maybe venues can operate at 25% or 30% but they can only operate at that capacity with the continuation of the wage subsidy, with a rates break and substantial other help, as listed in the submissions. The three submissions have a similar crossover of requests. It will take the entire raft of requests to keep these people and their skillsets within the industry so that in three, six or nine months or whatever we can go back to work.
I thank all of the organisations for their presentations. This is a very challenging time especially for all of the artists and those involved in the events industry. I presume quite a small proportion of the 54,000 artists benefited from the Covid payment of €350 per week. How many artists benefited? Was it less than 25%? Was it a smaller percentage?
Ms Angela Dorgan:
The most recent figure we have from the Department is 14,000 but that was four weeks ago. The Department has also set up a direct email for those who have problems qualifying. Another ask would be that there would be broader criteria for all of our sectors to qualify when, as we hope, the payment continues.
Ms Angela Dorgan:
As Ms O'Connor stated, after 12 March people could claim the pandemic unemployment payment if their work was interrupted. All of the people to whom we are referring literally make hay during the summer. Our busy time kicks off in late March and runs through to October. A substantial number of people in each of the three organisations represented here were not working in March and, as such, do not qualify for the payment.
On Covid unemployment payments, my understanding is that if someone was not working during the particular week at the end of February or had not been working for four weeks in the period from 1 January to the end of February, an average over nine weeks was taken into account. That too probably would have left those people unqualified for the payment. Am I correct in that regard?
The charity sector has been very hard hit. Many people who normally contribute to fundraising are not now doing so. Ms Howard referred to reform of our tax regime to incentivise and encourage charitable giving and keep arts organisations in business. What kind of reform is she seeking in that regard?
Ms Aideen Howard:
As the Deputy is aware, a large number of funded and other arts organisations are charities. We enjoy charitable status partly for the benefit and privilege of being able to fundraise. Our colleagues in the charity sector have carried out a significant amount of research on the kinds of reform that would be required to bring Ireland in line with countries that really incentivise investment and charitable giving. For example, the Community Foundation for Ireland has published a very useful document which proposes changes to the tax system that would result in investment in the arts being comparable with investment in other areas, film in particular. In addition, it is proposed that charitable giving by corporations and individuals could be much better facilitated and resourced under a revised system. I understand from colleagues in charities, the arts and Benefacts that several models are ready for review. We would be delighted to suggest models that the Government could investigate with the aim of making giving to our sector a little bit more attractive, in the way that it is in other European and-----
There are many international companies in this country, as well as many very big Irish companies. Should we be doing more to try to encourage them to sponsor artists? That practice is not as common in Ireland as it is in certain other jurisdictions. Is it all tied in to tax? Is a change to the tax code needed to bring about change in that area?
Ms Aideen Howard:
We would argue that there is increased and increasing capacity to successfully fundraise in our sector. However, it is very difficult to make that plausible and viable without change to the tax regime change to support it more widely. The committee will not find us wanting in terms of our ability to be entrepreneurial and raise money, but we need a corollary to match-----
I would tell large companies that it should not all be based on tax considerations. If a company sponsors a person or group involved in the arts community, that is of significant benefit to the local community and, as such, is also of benefit to the employees of the company. That approach should also be taken when seeking corporate sponsorship.
Ms Aideen Howard:
I certainly do not discount taking that approach. The two go hand in glove. For example, the Arts Council has invested heavily in a programme entitled Raise which will allow organisations to build their capacity to deliver in that regard. However, it is a very difficult time right now for organisations to try to generate revenue from those kinds of sources. As such, we need to-----
I am so used to standing up here. We do not stand up in committees. The time is tight, unfortunately, and there are many things I would like to raise. I will try to keep my questions short. We will try to keep the replies short to get in as much as we can.
Can the events industry representatives confirm that the sector is not generally State subsidised and that it now requires urgent assistance? Is it correct that reform and refinement of the pandemic unemployment payment and the temporary wage subsidy scheme are urgent? Does the sector need to deal with the seasonal work issue and the part-time work issue as work begins to become available slowly? Does the payment need to be continued at least until next summer as a first step? The events industry will certainly not get going until next March at the earliest. That is the first question.
The second question relates to talk about an industry task force. I take it this is important. When should it report so that steps can actually be taken on foot of a report to save the arts and events industry?
How big are rates and rents as overheads? How important would the waiver of rates be in particular? The restart grant is limited to €10,000. Many arts and events industry players are paying more than €10,000 per year. Is this too low a cap on the rates rebate for 2019?
Ms Elaine O'Connor:
I will respond to the first question. We can confirm in respect of support payments that we hope at the very least that they continue to next summer. We are looking at an entire season lost this year. We will only be getting back on our feet and working towards a new season next year.
We believe a task force should be established immediately. We have questions within industry that are delaying that progress. Our local authorities, for example, are among the largest promoters of local community events throughout the country. They face the same challenges as our entire industry. We have questions and nowhere to go for answers. It is imperative that it is put in place straight away.
Deputy Ó Cuív asked when we would expect to have information. We hope we could begin to start delivering reports initially for the July fiscal stimulus package but also to industry as soon as possible. It is only by trialling events and trialling our way through this that are we going to be able to build these events slowly from the ground up to ensure they are safe spaces, to ensure everything has been checked, and to ensure that our customers and attendees are confident in the spaces.
Mr. Shane Dunne:
I will add to what Ms O'Connor has said and pick out elements from the questions posed by Deputy Ó Cuív. One element is rates. There are several non-funded venues and theatres, including places like the Bord Gáis Energy Theatre, the Gaiety Theatre, the Olympia Theatre and numerous others throughout the country that have exceptionally high rates bills and are currently paying them in full. Those theatres are empty. The seats are empty. The staff are not there.
Deputy Ó Cuív asked a question about the pandemic unemployment payment. The nature of this business is that it is one day here, three days there and four days somewhere else. The big issue will be that as things start to reopen slowly, a person might pick up a day's work or two days of work. Will that person then be removed from the Covid-19 payment or the wage subsidy scheme? My understanding is that it could be up to six weeks before that person could get back onto it. That will make it difficult.
The €10,000 grant may be awarded on a case-by-case basis. It will be far too low for a multitude of businesses.
Mr. David Mongey:
I would like to add one further point to Deputy Ó Cuív’s question which is something that has not been mentioned, but grants would be very beneficial to our industry. There are many companies involved in the industry that have large quantities of stock in their warehouses that have been inactive for the year and on which much money is owed to the banks. As we know, the banks are only giving certain limits to their extension schemes. I know from sources in the industry that there could be up to €20 million worth of stock and equipment around the country for this major industry. We would be grateful if this could be considered by this committee in terms of supporting that side of the business.
Ms Angela Dorgan:
To echo both of those comments, the task force is needed immediately. The PUP extension, along with other measures ,should be in the stimulus package in July. The task force will be needed and is essential in developing a roadmap on how the entire sector gets back to work and how we can support Government in delivering that. We are the people with the talent, the know-how and the international networks.
On the question of rates, there are many artists’ studios and venues big and small whose rates are higher and lower than the €10,000 cap but, specifically, there are artists' studios, venues and practice rooms that would fall below that figure. This figure should be lowered or perhaps to have a rates holiday in those situations would be very beneficial to the sector.
I understand the difficulties the arts are facing and the devastation that this pandemic has brought upon the arts sector. I understood the difficulties the sector was facing before Covid-19 as well, as I had served as a director on Wicklow’s Mermaid Arts Centre. I know the amount of work that goes into organising, applying for funding, attracting and supporting artists and the outreach programmes that are organised to give people access to the arts who might never have access to them and the benefit which that brings. I know of the disappointment when a show or performance does not go well and the joy when it does. I also have experience working in event production and know of the huge skill set that exists across that behind-the-scenes sector the witnesses referenced earlier on, in terms of lighting, sound, power, construction, set design and that range of support industries. It is huge and brings great benefit and joy to many people.
My worry, which has been referred to by the witnesses, is that if a full season of work is lost, the seasonal partnerships and relationships that exist across the sector will be broken up. These are relationships that have been built up over years, whereby people know how to work well together. Were they to be lost, it would have a massive impact as we try to reboot and grow the arts sector again.
The Event Industry Association of Ireland submission stated that up to half of the businesses in that industry may not survive 2020. Does that indicate that there are certain sectors or places within the arts sector towards which we need to direct funding more urgently than other sectors? The issue of funding has been covered quite considerably in the submissions but one thing I always found was the inconsistency in funding. It was one of the biggest issues that artists faced with short timelines to apply for funding or that it would change from year to year. This would benefit the arts sector greatly as we move out of this period.
Ms Aideen Howard:
I thank the Deputy. We have talked a lot about ecosystem and the interrelationship of all of these sectors. Mermaid Arts Centre is a good example of a venue with 242 seats which, when it when it reopens, will presumably have 15% of that capacity available to it. This is also a very useful example because as a locally-funded arts centre, it sits in the middle of that ecosystem that is fundamental to all of us here. Mermaid Arts Centre, for example, has a fine tradition of funded arts.
It also interacts with the commercial music sector consistently and successfully, and has done so with Bray Jazz Festival over the years. It is a brilliant example of how, fundamentally, the two-tiered approach of local authority funding, even if it does come from central government, and arts council funding can maximise the input and output for the citizen. The attendance at Mermaid Arts Centre, which might be 35,000 people a year, is something we will have to invest in and sustain. There are key points in all our presentations that could benefit from particular targeted attention but, equally, we need universal action. We have identified that local arts centres' infrastructure and the local authority budgets are major. I am keen to emphasise that that affects every person here and that investment in that area will be crucial.
Mr. Shane Dunne:
There is no doubt that the people, the teams and the relationships the Deputy refers to are what I describe as my summer family, that is, the people I see from only April to September. I do not have to read stories to them but we work together. Just because somebody is the stage manager on the main stage at Electric Picnic does not mean that he or she does not spend a portion of the rest of the year in the Abbey Theatre or the Gate Theatre. This is an industry where we all work together. People who pop up on television sets then pop up at outdoor shows a couple of weeks later. The problem we have at the moment is that the entire industry has stopped.
The Deputy is fully correct that these groupings, companies and SMEs will be lost and broken up. Those relationships, events and businesses will not come back unless there is a raft of supports such as those requested from the NCFA, the Event Industry Association of Ireland and us at EPIC. We need the bulk of those supports to come through immediately. As Ms Dorgan said, it needs to come through in the July stimulus package. It is not something we can wait for until the depths of winter. When that comes, it will be too late.
I thank all our guests for their contributions and submissions. If this pandemic has one good outcome, it has done a great job in quantifying, in euros, cents, jobs and numbers, how important the arts industry is to us. Many of us experience the industry through people in our families who work in it, but to see the value of it in economic terms, and to present that to a committee such as ours and to have us be able to support that in the July stimulus plan and beyond, is vital.
Many of the issues I wanted to raise have been raised and I do not want to repeat them. Our guests might comment on the potential for a model of long-term funding that would include grant aid, direct payments, charitable donations and tax incentives. Do we yet have such a clear model? Sometimes those methods are not bedfellows. If they interact with one another, I would like to be clear on that so we can support their use as much as possible.
It is clear the wage subsidy scheme and the pandemic unemployment payment will have to be extended for this industry. There are large elements of this industry, similar to that of aviation, that just will not be able to come back as quickly as barbers, hairdressers, restaurants and pubs have done this week. My party and I will support that in writing to the new Minister.
A total of 72% of artists earn less than the national minimum wage and, presumably, an awful lot of them support themselves with a primary or secondary job. Have our guests been able to quantify how many artists will be lost to the industry through this? How many will have to turn their back on the industry, both directly, in the case of artists, and indirectly, through support workers?
I had intended to ask questions about local authorities but I understand that Deputy Gannon will ask them, so I will not overcrowd my contribution with that.
Ms Angela Dorgan:
It is great to see how many around the Dáil Chamber got to a barber so far, now that they are open.
I regard the arts sector as a house of cards in terms of funding. I am not referring to the HBO show. I wish to refer to the moneys with which the arts sector, festivals and events fund themselves and that allows them to put on work by, support and pay artists. My organisation is partly funded by the Arts Council. We use that funding to develop programmes and we can sometimes access international funding for parts of our programme. A major part of the funding, the third part, is from ticket sales and sponsorship. Since there are no events, we have nothing to offer sponsors. Since a big chunk of our annual event, Ireland Music Week, will be online, we have far fewer pouring opportunities to offer drinks sponsors and far fewer to make it an attractive element. On an organisation-by-organisation basis, it means we have reduced capacity to hire Ms O'Connor's event company, with which we work, and it means we have reduced capacity to generate any sponsorship.
Typically, the Arts Council funding we get is about two thirds of what we need to stay open as an organisation. It is the funding that allows us to stay open for the rest of the year as an organisation. People should consider what is left when ticket sales and sponsorship opportunities are taken away. It is not as if everybody gets 100% funding in the arts sector. I am referring to what happens with the national resource organisations, local events and festivals. When any one of the cards comes under threat, the whole house falls. The NCFA looked for so much funding for artists because the organisations and events are not hiring them or paying them. It is a matter of the Arts Council being able to intercept to determine where the key organisations are under threat because they cannot generate ticket sales. Some 50% of the income of the Project Arts Centre, for example, is non-funded. Events such as ours and venues such as those to which I have alluded are left wide open to the problems of dissemination and evacuation, which many Deputies have talked about. If we cannot be supported to keep our card going so we will be in a position, when we re-emerge, to generate more funding through our events and hire colleagues in the events industry, there will be a very bleak landscape. We are innovative and intelligent, and we have all referred to that. If help can be provided in the three areas in any way, it will be of benefit. I refer to a tax regime encompassing more types of sponsorship and ways to invest in an organisation just so it can exist and so we will not always have to look for sponsorship for events. There is a suite.
To refer to a previous question, all of this can be worked out in a task force along with a timeline. A big threat to organisations is that they do not know how long they have to budget for without the three lines of income.
Mr. Shane Dunne:
While EPIC and the people we represent are the same as those Ms Dorgan represents, we are very different. For us, as an industry, to put five artists on the stage in Croke Park or Slane takes approximately 2,000 staff. The staff call for Electric Picnic is in the region of 4,000. That is 4,000 taxpayers.
I was asked about non-funded organisations by comparison with those that are funded. We are 0% funded as it stands and that is why we have the list of demands we have. We are not actually asking for funding but asking that, as we reopen and increase capacity from 25% to 50%, we be given the time, through the pandemic unemployment payment, wage subsidy scheme, rates breaks and a reduction in VAT, to allow our businesses to recover. That is desperately needed. To reiterate an earlier point, it is desperately needed now rather than in a budget in October.
I thank the witnesses. I go back to the local authority funding as the point was emphasised several times during today's session. I fully appreciate the importance of local authority funding to the arts. Is there a fear or anxiety that somehow local authorities will not fund the arts in the next year? If so, where does that fear come from?
Ms Elaine O'Connor:
The fear is that local authorities will remove funding from local community events and other types of events they support. That would be a nationwide impact on everything from any sort of activity taking place in a local theatre to, I presume, the likes of Christmas tree lighting events.
Ms Elaine O'Connor:
I am not 100% sure. My experience over the past 15 years and particularly with the crash in 2019 indicates that events are always the first to go. That makes sense. Many community events receive discretionary funds from local authorities and one might assume that funding will be reduced significantly. It will put much pressure on. Additionally, as I mentioned, organisers will need to adjust how they do business and work with people outside organisations. There is considerable additional cost in delivering, planning and sustaining events.
My next question is also for the EIAI. A very important point was made that recent funding will not filter through the industry ecosystem. Will the witness elaborate on that statement? If possible, could alternatives or additional funding streams be suggested that might be of benefit to the industry or the people represented by the organisations present? How can funding benefit those organisations?
Ms Elaine O'Connor:
On the second page of our presentation, we have a diagram of an iceberg. I do not want to diminish anything that has happened today but we were trying to point out that events, the arts and entertainment are at the top end of the iceberg, with much going on underneath that also needs to be supported. We have made a number of recommendations in our submission that would cater for many of these but members can see that a large amount of meaningful work is required. We need to start with a blank page and work through the practicality, viability, economics and every other element of this to ensure we can pull it together, deliver safe events and be able to produce a fall-back plan should something change. We need some sort of certainty that when we plan events and invest in them, they can be delivered.
The roadmap does not yet exist. Who should be in the room when that roadmap is developed? I am very conscious that many of the important decisions made in the past couple of months have not had particular sectoral interests in the room. Who should be in the room when the decisions are made?
Ms Elaine O'Connor:
We have suggested that this should be an industry-led roadmap. It would include my colleagues, stakeholders in statutory agencies, An Garda Síochána, the Health Service Executive, the Health and Safety Authority, etc. We need guidance and clarity on what is expected from the industry and we need to provide stakeholders with our expertise as to what is possible and viable on the ground. We need to work those practically into a workable roadmap to recovery that would work for all parties in the industry.
How has the engagement been between the arts community, freelance technicians and the Department of Employment Affairs and Social Protection with respect to the pandemic unemployment payment or wage subsidy scheme over the past couple of months? Have they felt respected?
Ms Angela Dorgan:
We went to that Department through the Department of Culture, Heritage and the Gaeltacht. It will be changed again and I have already forgotten the old name. We made submissions very early on and one day we had a Zoom call with 500 people. Over 400 of those individuals had problems. When we went to the Department it was quick to set up a dedicated telephone line to help people with qualification problems. They dealt directly with the Department of Employment Affairs and Social Protection on behalf of the artists.
Mr. Shane Dunne:
On that point, we are hearing from many of the sole traders in particular. People who are stage technicians, lighting designers, safety officers, event controllers, etc., have had considerable difficulty with the scheme. Much of that goes back to the fact that they were not working in January and February. They have had many problems with it and there has been some pinging around of contacts within the Department of Employment Affairs and Social Protection. I think it is starting to fix itself but it has taken some time.
To go back to an earlier question from the Deputy with regard to the funding already allocated and how it would go into the wider industry, the Arts Council is unapologetic in representing creators and artists, and it is right. That is what it does and does well but to go back to the earlier point, let us consider a large-scale outdoor show, be it in Páirc Uí Chaoimh, Pearse Stadium, Croke Park or the RDS, or even a 3Arena show, with four or five artists and creators on that stage and 1,000 or 2,000 staff - there are 4,000 staff at Electric Picnic. With the greatest of respect, and I genuinely mean that, Arts Council funding will only touch a fraction of those people. That is what the Event Industry Association of Ireland and we in EPIC are talking about. We are not asking that the Government not fund the Arts Council. In fact, it should give it more. The Arts Council does a fantastic job and is grossly underfunded. We are saying that the wider industry, the non-funded sector, all the staff and all the SMEs associated with that, need a raft of supports to survive over the next six, eight, nine, ten and 12 months.
I thank the Chairman and the committee for agreeing to my request to have this session and to get EPIC and the National Campaign for the Arts in before the committee. It is hugely important that their voices are heard.
The terrible irony of the current situation is that society has never before needed the arts, music and culture more than it does now to sustain itself in a difficult time. It has now realised the value of the arts, music and culture, even through their absence, because people are missing going to gigs and live events. Their value and importance have been underlined tenfold by the current situation but the arts are facing an existential threat to their existence and all of the people front of stage and behind the scenes are also facing such a threat. The witnesses have made their case fantastically well and I hope the Government listens in terms of how important it is to sustain them all through this situation, however long it lasts.
Many of the economic arguments have been made and I do not want to go over them because the witnesses made them so well. I would like them to talk a little bit about the human impact of all of this on the artists and the people behind the scenes whose livelihood is now threatened in a fundamental way. In some of the Zoom meetings we all attended recently people were pointing out that, pre-Covid, musicians who play in the pubs, such as those in Temple Bar, would have been paid €130 for a two-hour set. As we speak, they are being told they might get €30 for two hours. That is not sustainable and it is incredibly demoralising for those musicians. They need the payment and they need a guarantee now that the pandemic unemployment payment will be maintained until their livelihood can recover. That is just one example I can think of. At the meeting we had online, Bressie spoke about the mental health impacts for people of having mortgages and bills and not knowing what is coming down the line given the current situation. I would like all the contributors to talk about that mental health impact, the anxiety and the human consequences for people front and backstage.
The other area I want to ask about is the role the witnesses envisage for public service broadcasters, the national broadcaster, in all of this. One of the comments made repeatedly at the meetings was that we should have a minimum amount of original domestically produced content on the national broadcaster to encourage original content production, performers and so on here.
Perhaps the witnesses could comment on that demand. I refer also to funds for the production of original content. Could they say a little bit more about payment for online work? That featured quite a lot in the meetings we had.
Ms Sophie Ridley:
I will answer the question on the effect on people. Individuals are not sure how long their payments are going to last. They are looking at children going back to school in September, with uniforms and book lists, and then at Christmas. They have no idea whether they are going to be able to pay their mortgages or buy Christmas presents. SMEs have no idea how long they have to budget for. They are approaching their banks and are not getting much help. These people are really suffering. We are an industry of people who come up with solutions and we have no control. We cannot come up with a solution. All of the members of our committee, and I am sure the other committees, have had really sad and painful phone calls from people who have closed their businesses. They cannot see the light of day and do not know how for much longer this will go on. I refer also to mental health issues. Bressie, our spokesman, speaks to that much more ably than I can. One of the things we are asking for is funding for mental health support for our members. As I say, we are an industry of doers and at the moment we cannot do. We cannot see when we will be back to doing things. It has a really bad effect on people's morale.
Ms Angela Dorgan:
I can speak to exactly the same experiences as Ms Ridley. We hear from artists who do not know when they can make work again. We have the same conversations that EPIC and Ms O'Connor have. People are forced to look at other jobs or migrate out of the sector. That will have a really devastating long-term effect on the sector, as Mr. Dunne noted earlier.
The mental health impact is similar to the mental health impact on everybody in this country. Covid-19 was a devastating time, but some sectors of our country are getting back to work and see light at the end of the tunnel. One cannot overestimate the impact on artists, workers, organisations and companies in the events sector of not knowing how long the tunnel is, let alone where the light may come from. Although it may not seem like much, the only thing we can immediately offer everybody in our sector is the extension of the Covid-19 pandemic unemployment payment. That will at least allow them the opportunity to stay in the sector and to contribute to it coming back.
Regarding the question on broadcasters, two issues arose in our sector regarding artists making money from their work. Daytime radio, running from 7 a.m. to 7 p.m., pays the most. Featuring more Irish artists is an absolute must. That is why broadcasters need to be represented on any task force. We should follow France and New Zealand, where different strands are coming together so that right hands and left hands move at the same time and strategies that benefit everybody can be built.
The other issue concerning fair pay that came through very strongly from artists was Article 13 of Directive (EU) 2019/790, the directive on copyright in the digital Single Market, which has been pushed through. Ireland has supported this in the European Commission. As a country we must call for that to be revisited and expedited, because the companies concerned all live here. Fair pay for artists for online work needs to be a priority of the next Government.
We should remember that artists and those working in the events sector face the same challenges as everybody else: childcare, health, mortgages and rent. These are all getting more and more difficult. Some banks are now refusing people mortgages and loans while they are on the Covid-19 pandemic unemployment payment. As Mr. Dunne, Ms O'Connor and Ms Ridley have stated, we were the first sector out and we will be the very last to come back. As such, the impact of these initiatives on society at large is not being felt by artists alone. It is being felt by everybody, but we will be the last to come back from them or even know when there is a possibility of doing so.
Mr. Shane Dunne:
I would like to add a minor detail to what Ms Dorgan has said but I echo everything she said. We have spoken to a number of SMEs within the sector in recent weeks. Across all sectors, SMEs are viable, profitable and successful businesses. The one thing that SMEs do not have is large stores of cash and massive reserves. That is why they are SMEs. We have found in recent days that SMEs have been granted a three-month or six-month loan break. An SME might have borrowed €1 million to buy equipment such as a public address system. Those SMEs are now being told that they will have to make those repayments in 2021. In 2021, those SMEs will have to pay 18 months' worth of payments instead of 12, in a year when they will most likely not have any money until the end of the summer season, assuming we get one.
Returning to the mental health issue, these are, in some cases, businesses with four, five and up to 20 staff. The business owners are worried about their staff, bills, children, childcare and mortgage costs. They are worried about their businesses. In many cases, business owners have spent five, ten, 25, even 45 years building up that business and are watching it crumble in front of them with little or no help from the banks or insurance companies, although that is a discussion for another day. Ms Ridley touched on this point, but those SMEs need support now and a little chink of light at the end of the tunnel will help them immeasurably over the coming months.
Mr. David Mongey:
I will come in on that point because I am in the SME sector and have a staff of approximately 40. I can see the stress on my team, many of whom are at home, twiddling their thumbs and waiting for the next event. As I mentioned before, these people are passionate about their game and highly skilled. We had The Gathering a number of years ago and the next one is scheduled for 2023. All of the witnesses around this table made a contribution to The Gathering. It is a large industry with great talent. We must protect that talent, mentally, physically and financially.
As Mr. Dunne said, some of my staff have babies, concerns about childcare and mortgages to pay. The banks are causing stress and not giving mortgages. A number of people on my team recently got married and want to build or buy houses or do stuff like that. This is a phenomenally stressful time for them.
I know from within the industry that there is considerable talent and a passion to be the best in the world. I think we are the best in the world because we have the skill, the chat and the craic. We know how to deliver a top-class product.
I thank our contributors. This committee has spent a number of weeks analysing the pathway into Covid-19, how we handled the nursing homes issue and all of that, and now we are looking at the devastation that has been wrought economically and how to move out of it. Today is probably one of the most telling days of evidence because we have heard about the overall effect on our SME community and people who are privately employed, and the challenges seem to be getting greater and greater. That is not to say that we cannot overcome those challenges but we are going to have to work together.
I have long been an admirer of Mr. Mongey's business and the digital equipment he supplied to the National Ploughing Championships. I know that for Mr. Mongey's business and others like it, much of that sound, lighting and digital equipment is bought on lease purchase. Once a person has engaged in a lease purchase, it is difficult to get any change to that contract without major financial penalties. How is the industry surviving in that respect? I imagine a lot of capital equipment is purchased that way.
Mr. David Mongey:
It is a struggle. In fairness to the banks, they have given a three-month moratorium, but the leasing companies simply want their money. That is why I said that I think grant aid would make a significant contribution to getting us over the hump for the next couple of years. A long-term loan at zero rate would also make a significant contribution. When a person goes to a bank seeking a loan, he or she does not have to jump through the same hoops and deal with the bureaucracy. A simple VAT return from any business in this sector will show the collapse of the industry. Some grant aid for people in the industry, particularly to pay for their stock and help with financing, would make a huge contribution.
I am sure it would. I also wonder whether, where people are running into difficulty, the banks are passing that on to the credit bureaus. I know leasing companies are very difficult in that respect. A lot of sole traders will find it difficult now to meet payments, get extensions to payments and all of that. It is very unfair that people who have been forced into this situation suddenly find their credit rating has been impacted.
I would like to ask some of the events people about funfairs, which are probably an adjunct. I think only one insurance company was providing insurance, through the Showmens Guild, over the last couple of years. This was a huge problem even before the onset of Covid. In my constituency, in Tramore, which has the amusement park, this is an ongoing issue. Have the witnesses had discussions with any Department or received any kind of solace with respect to insurance?
Ms Elaine O'Connor:
Having had a conversation with the Showmens Guild myself in the last few days, I am not aware that there has been any communication there. I will take the opportunity to point out that funfairs and amusements are particularly challenging. They have a massive amount of equipment that needs to be maintained to make sure their certificates remain valid. They have other challenges that are slightly harsher than the event industry from the perspective of proximity and social distancing.
We are aware of those. We have spoken today about the need for everybody who has contributed to the conversation to come together to make a strong statement about certain areas. We spoke about it previously but insurance is a key issue for the SME sector.
With respect to festivals and social distancing, have the witnesses any insight into the outdoor festivals this year and how they are going to be impacted? On the possibility of opening up Spraoi as a festival again in Waterford, we have not had the go-ahead on it as yet. It is supported by the Arts Council and normally takes place over the August bank holiday weekend. Has anybody any insight or have they been told they can start getting ready for some of this?
Mr. Shane Dunne:
The short answer is “No”. What we have at the moment is a ban on events involving more than 5,000 people up to 31 August and we have the roadmap which just runs to 20 July, which I believe allows for up to 100 people indoors and 500 people outdoors at that point. The outdoor industry, be it festivals or stand-alone events, is very much dependent on the social distancing requirement reducing from 2 m to 1 m. I do not think we have any opportunity at 2 m. At 1 m, and with these supports in place, we think we can look at some outdoor shows. These are hypothetical discussions but at 1 m, we can potentially do a show for 3,000 or 4,000 people where we would normally have one for 20,000 people. Outdoors, one has that ability but unfortunately, in the Abbey, the Olympia or the 3 Arena, we cannot move the walls. The capacity is restricted and that is it.
I mentioned earlier that we might address insurance another day but now that it has been brought up, I wish to mention one thing. The Deputy noted that only one insurer is looking after funfairs. In the last couple of years, we have seen a number of insurance companies in Ireland get out of the event industry. They do not cover it any more. We are being insured or underwritten by companies internationally. We are finding this year that events that thought they were covered for cancellation insurance, and are covered for cancellation insurance as far as their policy goes, are not being paid their cancellation insurance. This is going to be a bigger issue in the longer term when we do reopen. To give a very quick example, something like the Gaiety pantomime has an upfront investment of about €1 million. The show would normally start around July with set builds and costume, with actors coming in from August. If we get to the end of November or start of December when the pantomime starts and there is a cancellation, be it due to a localised lockdown or a cast member coming down with Covid, there is no insurance to cover that. It will be the same for artists touring, venues and all of the theatres. We need a plan for that and we need the insurance companies to be pulled into line by the Government, if the Deputies will excuse the strong language. Otherwise, we are facing a long-term issue as regards covering it.
As part of that roadmap for theatres, we will need a derogation on social distancing on stage, such as many European countries have already brought in. There are beautiful moments in theatre. People kiss. They cannot do that from 2 m away or 1 m away. This will have to be changed.
Insurance is a longer-term problem, but it is one that we need to start working on straight away.
I am perplexed by the fact that it is acceptable to have 150 people in an aircraft for three hours yet 150 people in the Abbey Theatre is a threat to life. That is nonsense. During the reign of clerics, the arts were supported but it seems during the reign of medics, they are left to go to the wall.
I thank our guests. I have a number of questions for them, and maybe more than they can answer. If so, perhaps afterwards they will supply written replies to me or to the committee. Responsibility for the arts will now be under the remit of the Department of Media, Tourism, Arts, Culture, Sport and the Gaeltacht. I am extremely disappointed that the islands have been taken away because the islands and the Gaeltacht are very much one. Splitting them is not a positive move.
It is vital that Ireland sustains and grows its reputation as a great place in which to do the business of arts and culture. The responsibility lies with the Department of Finance and the Department of Media, Tourism, Arts, Culture, Sport and the Gaeltacht and the others - as already indicated, the Department has been renamed - to introduce tax incentives for investment across the arts and culture sector, in all its art forms. Incentives to win programmes and partnerships will keep Ireland competitive in this landscape. Do the witnesses believe this would be of benefit to artists, arts workers and arts organisations?
I have found that after announcements have been made, funds will be available that do not get to the people who need them, namely, the people on the ground. To explain this in detail, it was announced recently that farmers would get a package worth up to €50 million. That was most welcome but, as always, the devil is in the detail. In that context, most of the hardworking farmers who desperately need the fund, are unable to access it. In the past fortnight, the Government has announced a €25 million arts and culture Covid-19 emergency package. Have the members of the three organisations access to the funding? Is the funding freely available to all?
Well over €7 million has been lost to the arts sector due to cancelled events. God knows what the figure will be by the end of the summer. Has the Government given an indication that it will continue to support all freelance artists and arts workers by means of the pandemic unemployment payment until mass gatherings are permitted again?
The national audience survey indicates that the arts and culture sector will be the last to return to full capacity and will need supports to ensure its survival and recovery. The arts will be fundamental to Ireland's recovery, particularly as they have an impact across society in many different ways, including the economy, education, tourism, health and well-being. Has the Government given an assurance that an equitable portion of the European Commission's structural fund is committed to the arts and culture sector?
Do the organisations believe that a reduction in VAT and providing funding for businesses involved in putting on viable events would ensure the longevity of those businesses? It does not matter whether it is a concert or some other type of entertainment. For tens of thousands of people, no matter what their religion, the biggest event they attend on any day of the week is church. Some churches can cater for over 500 people yet the Government is only allowing gatherings of 50 in a churches, which is a great disappointment to many. As has been stated here, 150 people can fly in an aircraft. Can the organisations comment on the fact that only 50 people at a time can attend church?
Mr. Shane Dunne:
I will briefly answer a couple of the questions before handing over to Ms Dorgan, who is better positioned to answer a number of them.
On €7 million being lost to the arts sector and the money not coming down, it is important to clarify that there are two different sectors. We do the same thing but there is a funded sector, which is where the money from the Arts Council went, and there is a non-funded sector, which comprises all of the community events and right up to the Electric Picnic, the Spice Girls' concert in Croke Park and everything in between. Reduced VAT will help us because we are going to open at a reduced capacity. Any savings that we can make to help us with a reduced capacity, whenever we do open, will help. Currently, we pay VAT at a rate of 13.5% and we have asked for it to be reduced to 5%. An old accountant of mine used to say it was half of a loaf or no bread. In this instance, 5% of something is better than 13.5% of nothing.
The Deputy asked so many questions that I was not quick enough to write down all of them. The Deputy and I are both from Cork yet I could not keep up with him. I will hand over to Ms Dorgan who will be able to answer a few of them.
Ms Angela Dorgan:
I am loving the Murphia. In terms of detail, the Department got €25 million and €20 million of this was given to the Arts Council. There are comprehensive details on how the Arts Council plans to spend the funding in the Survive Adapt Renew document.
I sat on the committee that prepared that document. The genesis behind it was to get it out to the sector as quickly and efficiently as possible. My organisation is part funded and a client of the Arts Council. It has already written to ask us to put back in our budget for the end of the year in order that it can identify whether, as a resource organisation, we will need support. It has done so with many other resource organisations, venues, theatre companies and arts centres. From €9.2 million to €9.3 million of that funding will be given directly to artists through a suite of bursaries. The detail of the Arts Council’s proposal examines broadening the range of persons whom funding can reach. Artists will not have to be already in receipt of funding as new bursaries will be made available. Some of the bursaries will speak to where artists have gone during Covid, such as bursaries for organisations and individuals to adapt to working online.
My colleague, Ms Howard, is better placed than me to answer the question on taxation. That said, I think some of the work being done by Benefacts will be of significant benefit to the sector in the context of how taxation, including VAT and such matters, will work for the SMEs and arts organisations in the sector.
Ms Aideen Howard:
To follow up on that point, the Arts Council advisory report published in recent weeks includes very useful language relating to taxation which could inform any new review. It calls for a review of taxation practice insofar as it relates to the arts in Ireland and internationally to make recommendations around the tax regime, which would include an examination of VAT, gifting to the arts and possible measures on artists’ incomes. As was discussed earlier, there is great capacity within the sector to raise money, but without regime change, it will not be worth much.
Mr. Shane Dunne:
I will attempt to address to the Deputy’s question on the number of people allowed to attend mass. My mother, for example, is very anxious to get back to church. Most people to whom I and others in the theatre forum have spoken were disappointed with the guidelines pertaining to indoor gatherings because they do not take scale into account. The maximum number of people allowed to gather indoors is 50, but that could be 50 people in a 400-seat theatre or 50 people in the 3Arena which seats 9,500. It should be considered on a case-by-case basis, based on a percentage of capacity or with regard to being able to adhere to a 1 m or 2 m social distancing requirement, depending on which is prescribed. That answers the Deputy’s question to a certain extent. Some churches can comfortably accommodate 500 people, but some others can only take 50 people.
It is not clear whether there is any legal restriction on gatherings in churches. I do not think there is such a restriction. It was not stipulated in the previous regulations. I do not know whether there are regulations in being at the moment. Insurance may be an issue. Obviously, every premises is free to determine whether to open, but that is a different issue. Has Deputy Collins concluded?
I thank the Chairman for his patience. I am sure it is the first time for some of our guests to appear before an Oireachtas committee. It is my first time to sit on a committee. We are all finding our feet.
I have received submissions that highlight the harrowing reality facing our arts and entertainment industry. Funding for the Abbey Theatre has not yet returned to pre-2008 levels. Research conducted by EY indicates that the arts sector is facing a decline of 42% whereas the figure for the wider economy is 11%. It is clear from the statement of the Arts Council that the arts industry is the least confident of all sectors with regard to its ability to operate through Covid-19 and beyond.
I am concerned about the viability, sustainability and loss of valued skills directly and indirectly associated with the sector as well as the economic loss that comes with it. The impact of the loss of skills will reach out into other areas. These areas are not strictly related to the arts but that loss will affect programmes like the Creative Schools and Creative Ireland programmes. Although community based and not professional, these programmes are wholly reliant on professional input to make them happen in the first place.
I was speaking to the manager of the Backstage Theatre in Longford. My constituency is Longford-Westmeath. I am flittered with opportunities to engage in the arts and entertainment sector, from festivals to theatres. We have an abundance of them but all are being greatly impacted as they try to come out of Covid-19. My hometown of Mullingar will have no Fleadh Cheoil this year. The fleadh would have sustained the local arts centre there for at least two years. The manager of the Backstage Theatre told me this morning about their artist in residence. She is a playmaker. Her project is to work with the local children in the town. They are going to complete the work but they have no idea when they will be able to stage the production.
I have several questions. I will start by asking Ms Dorgan about social distancing. I referred to Mullingar Arts Centre earlier. The people running the centre are now looking at extending the number of shows they can put on for the Christmas pantomime. They are reducing the number of attendees but they are not increasing the ticket price. This is a reflection of the dedication of the people who work in this area. They are determined to put this on come hell or high water. The reality, however, is that it is not sustainable, certainly not from a financial perspective. The only guaranteed income they have every year is from the local authority. If that was to be withdrawn, I would not like to think about the outcome. The Backstage Theatre has a capacity of 212. Due to social distancing, it will only be able to stage events for 17 people. That completely removes the enjoyment for the audience who have to sit so far away from one another. It almost takes away the craic and removes a layer of the reason people go to these events.
I am keen to know the extent to which such measures are replicated across the country. In the week before the closure, my arts centre had over 2,700 children engaged in one way or another. That is a phenomenal figure and it is because of the outreach they do in rural towns and communities. My concern is that if these activities stop, they will never come back. If that were to be the case, we will lose a generation of potential Hoziers, actors and event managers, which is a real shame.
I am curious to know whether the National Campaign for the Arts has a figure for the number of those involved in the sector who did not receive any financial supports during Covid-19, either due to work practices or because they are over 66 years of age.
I will keep going because I have some questions for the other representatives and they may be able to swap over. I read the event production industry Covid-19 working group submission. These individuals are not in the habit of asking for help. They fly under the radar, so to speak, when events are being managed. However, events will not take place without these people in the background. The working group referred to rate rebates and the pandemic unemployment payment. Mr. Dunne referred to something that has been raised frequently with me, namely, the percentage of capacity as opposed to the capacity number. Mr. Dunne's submission mentioned help. Outside of rates rebates and the pandemic payment, what does help actually look like? For this sector to continue to be viable and to ensure that the €6 return for every €1 invested continues to flow in to our economy, what specific supports would the working group like to see in this non-funded side of the sector?
I note the Event Industry Association of Ireland submission refers to a "bustling calendar of events". A bustling calendar is certainly something that I see in the arts in my constituency. The manager of the Dean Crowe Theatre in Athlone mentioned something to me that I found concerning. It was the difficulty that those running the theatre are having in developing a programme of events for the future given the hesitancy of promoters and artists to book. This is because of their sense of a lack of security and the viability of employment in the sector. My take on this is that without a comprehensive and highly structured support package put in place by Government, we will see this replicated throughout the country.
It goes back to that loss of talent and skills and the foundations of the arts and entertainment industry will be fundamentally eroded if it loses people to permanent employment in sectors that are unrelated to it.
Are the witnesses hearing this elsewhere? Is this unique to this sector? I do not believe the answer will be "Yes”. How prevalent is something like this? How are the Government’s most recent announcements putting some confidence back, in place of the fears those who work in the sector may have about this being a viable career into the future?
Ms Angela Dorgan:
I agree with the Deputy as to what she is experiencing in Mullingar. I also think there is something in the water there with all of the musical talent that is up there. This is very much replicated around the Twenty-six Counties. Our experience is that funded art centres become pinnacles and centres of other arts activities such as creative schools. We have all referred to the intelligence and innovation in our sector and much community and participatory arts practice has come online. The experience is not the same but the sector has reacted really quickly to its audiences, whether that is young or old choirs, those centres have reacted rapidly as have the artists who work on those.
Our fear is that if those centres, individuals and artists in residence are not funded to exist, anything that is available now will also evaporate because one will see those people having to move into other sectors because there is no work.
The other challenge for the arts sector is that we are seen as being so robust and well able to get on with things, that there might be a laziness in not hearing us and appreciating that this is a very important time to fund this sector. At present, we cannot be left on our own to do it anyway. The entire rug upon which we are able to sustain ourselves, which is public performance, has been pulled from under us.
On numbers, the Arts Council, in its initial survey gathered for the first three months of Covid-19, found that 12,000 events and activities were cancelled per month around the country. This echoes those numbers the Deputy talked about in Mullingar, Westmeath and Longford. That figure for activity will also evaporate unless those centres, local arts activities and local arts funding are maintained and sustained and unless those artists can be given the opportunity to come off the PUP and to engage in full-time work again, albeit delivering that work online for the time being.
Mr. Shane Dunne:
I thank Deputy Clarke. We have gone through a number of these issues already but I will touch on them again. There are practical additions to the PUP, such as rent and mortgage support, which are key to everyone working in this sector. We need to avoid people being forced onto jobseeker's payments. These people are not jobless but currently are unable to work for a reason beyond their control. Once they end up on jobseeker's payments we all are in agreement that we will lose them, and will lose them for good. We have touched on the rest of it already but we need some kind of a roadmap immediately, which could be the start of the event industry task force we have talked about already. We need the rest of the requests to be agreed to, namely, a break in VAT and insurance, which is a big one. This may become a national insurance that is Government-backed to cover events, because insurance companies are not going to do it. It is going to be a very difficult industry for us to operate in and this applies to everybody, both funded and non-funded activity. If we cannot get some kind of a handle on insurance, we are going to have a major problem.
Those practical additions to the supports would be great but all of the requests need to come to fruition for this industry to come back, to strive and to develop again, as it will. We are confident it will but it needs help and support immediately. We have mentioned the end of July stimulus in order that we can get through this difficult time and come out stronger on the other side.
Ms Elaine O'Connor:
I will speak from personal experience to try to give the committee the best perspective I can. I have a 15-year-old company that has won multiple awards. We specialise in the production of large-scale public events. I have 20 years' experience working in the industry but as it stands, simply put, there is no incentive to stay in business. My staff are at home and I cannot offer them any direction as to when, where or how I can offer them work. I had interns coming out of third level institutions lined up to get experience within industry but that will not happen. When I look to my clients, which include private, corporate and local authorities, no one has any direction. As it stands, when I assess the situation, I find it very hard to see any possibility of me remaining in business without supports.
I thank all our guests for a very powerful presentation. There seems to be a sympathetic ear from all members, and I hope we can discuss how the committee can put forward recommendations arising from what our guests said. The point made by the Chairman is a very good one. It is a bit baffling that for us to engage with NPHET and the Health and Safety Authority to ask the simple question of whether 50 people in a venue-----
I apologise for interrupting, given that we are in a committee meeting and are not having a conversation, but NPHET and the Health and Safety Authority do not make laws. The outgoing Minister made the law and there is now a new Minister for Health, who has the power to change the law, annul the law or whatever.
That may be so, but I think the Government is possibly taking advice from public health authorities. It is something we could try to get the bottom of and see what the rationale is because there does not seem to be a consistent one behind that. That change would make some difference but it still would not solve the industry's problem until we get back to normal. Is that correct? The industry certainly has my support and, judging from the response, there is a great deal of support from other members. I want to commit to pushing the committee forward as much as possible on our guests' behalf.
I turn to a broader question. The arts and live entertainment are such a central part of the cultural fabric of this country and they are so beloved of everybody in the country. They are badly needed, as we have seen more than ever during this crisis even though most people know it anyway, yet it is such an overlooked sector and it is so far down the pecking order when it comes to getting support. It is a curious irony that that is the case. I hope that this meeting and our guests' campaigning, which has been fantastic, will start to remedy that, but I am curious as to why it is the case and what our guests' views are as to why that irony exists. Something that is so important and valued gets so little support and is often far down the pecking order when it comes to issues that are considered important by the political system.
Mr. Shane Dunne:
I can see that Ms Dorgan is ready to go with the answer to this so I will respond quickly from our side. It has been so obvious in recent weeks and massive packages have been doled out in New Zealand, Germany and other countries. The arts in this country have been grossly underfunded for years and now, during Covid, the chickens are coming home to roost. Ms Dorgan might talk about the funded sector because she knows far more about it than I do.
From a non-funded point of view, as to why we are so overlooked, we have never previously asked. As we stated in our submission, we are entrepreneurs, innovators and small businesses. We go out there and make things happen, and we do it off our own steam.
That applies from David Mongey, to Murt Whelan, who has a PA company, to Shields Mobile Stages, Cork, right up to Peter Aiken and MCD. They have done it themselves. We have never asked before. I suppose that if one does not ask, one does not get, but we are here today and we are asking because we have no choice but to do so.
Ms Angela Dorgan:
I do not know the answer but I do know we are way down the European pecking order in terms of how much we invest in the arts. Our proportion of investment is between 0.1% and 0.2% of GDP while that of an average European country is 0.6% of GDP.
To make a personal observation, I can guess the arts have always sustained themselves because people who make art have to make art. Nobody makes art for profit. There is a benefit that one can make commerce from art. We have traditionally been asked by successive Governments in this country to justify the economic value of art, but nobody ever asks us to justify the esoteric and societal value of the arts. Every last one of us saw that value during the Covid pandemic. We noted the music, television and books. Events featuring some beautiful work by Irish artists were brought to life on the Internet and television. We were all gripped by Connell's necklace in "Normal People" and we watched "Ireland Performs". We are all still watching "Other Voices: Courage", and we are buoyed up, pacified and comforted by all that. One will never hear from the arts sector that the arts are not worth investing in, but the funding is still less than in 2008, when the sector was last cut. Right across the board, the sector been dying a death by a thousand cuts, yet it has still sustained itself.
We have a unique moment in time now as a society and republic to really look at ourselves in the mirror coming out of the Covid pandemic and decide what we value in society. We need to put arts at the top. Various parts of an economy need help every now and again. We in the arts should never be asked to justify the arts or answer the question "Why the arts?" just as we should not be asked to answer the questions "Why education?" or "Why health?". It should be immediately answerable. We should not really have to be coming together here in the way we are. Governments all over the world immediately responded to their arts and entertainment sectors. If we as a country value our artists as much as we say we do and as much as we sell ourselves as a country based on them, we should invest in infrastructure that sustains them. We should also invest in all the layers under the iceberg that produce the world-beating artists and events that we produce.
I often wonder whether we value our artists or our dead artists. The dead ones are cheaper to value. I thank all the witnesses for attending and sharing their stories and testimonies. The meeting has certainly been enlightening and powerful.