The Grassroots Contribution: Voluntary vs Statutory?

The question of whether there should be a contribution from arena and stadium tickets into the grassroots live music ecosystem is now settled. But how should it happen?

Firstly, an apology. I try to be concise and on point so I take up as little of your time as possible, but sometimes posts like this have to be long because there is a lot to cover. Music Venue Trust has been working towards the Grassroots Contribution for at least six years, and we are now reaching a crucial point in the debate about how to deliver, manage and distribute it. That is a very complex question, and the easy answers, the shortest ones, aren’t necessarily the right answers.

The Government’s official response to the Culture Media and Sport Select Committee Report into Grassroots Music is unequivocal; it’s now official government policy that every ticket sold at arena and stadium level for a live music event should be making a financial contribution into supporting the grassroots live music ecosystem. The long-debated question of whether this should happen, initiated by Music Venue Trust more than six years ago, is now settled. It is the expectation of the government that if you are putting a ticket on sale for such a show, it will include such a contribution. It’s essential for the research and development funding it provides into finding and developing new British talent, and even more vital to ensure that we have access to high quality live music right across the UK. In the event you fail to do that, and right now too many companies are still failing to do it, the government is prepared to legislate to force you to do it.

There’s a wide consensus about who needs to benefit from such a fund. Venues were the first to be able to make a clear and indisputable case that financial support would be required, using the data and evidence gathered by Music Venue Trust to establish the necessity for it, but there is equally accepted validity in the case for financial support for direct touring costs of artists, as highlighted this week by the ferocious campaigning by Kate Nash, and for promoters, who simply cannot afford to take the risks required to get great music out across the country. On behalf of grassroots music venues, MVT has been making this shared case for some time; there’s no point in well-funded venues if no artists can play in them, just as there is no point in well-funded artists with nowhere to play. Unlike the competition prevalent across the music industry in general, grassroots live music is an interdependent ecosystem. The inability of an individual promoter to create and deliver shows has equally negative impact across venues and artists as it does on the specific individual or company who finds themselves unable to make things stack up economically. When one part of the ecosystem loses, we all lose. For the Grassroots Contribution, the way to maximise it’s beneficial impact is to ensure everyone is able to benefit and that way everyone wins.

There’s one further element of the current position that is also shared and agreed. The financial contribution must apply to every live music events at arena and stadium level to avoid creating a competitive race to the bottom. There are lots of arguments among music industry companies and colleagues about whether they can act collectively, but there is a broad understanding that the minimum expectation is that this financial contribution should be made on every show, leaving open the alternative option to act individually but with a collective result; that whenever a ticket for a major live music event is bought, a small part of it is helping to ensure we have a healthy and sustainable ecosystem

All of this is now agreed, well, it is by anybody who has been paying attention, and it leaves two possible outcomes. Let’s define what those are and then we can discuss the relative benefits of each model:

• Non-Statutory Grassroots Contribution (NSGC) – a model of collection which is voluntarily made, but mandatory in nature and adopted by all

• Statutory Grassroots Contribution (SGC) – a model of collection mandated by a legal framework imposed by supra-national, national, regional or local government

Dealing with an NSGC first, this model is the one preferred by government. There are good reasons for this, some of which are to do with the legislative process and lead to practical considerations of the current economic climate for the grassroots sector. It’s also the preferred model for Music Venue Trust, and our reasons for that mirror the government’s own but add in a whole host of other benefits with such a model and/or concerns about the alternative Statutory option.

The first thing about an NSGC which is attractive to us and the government is the speed at which it can be done. A NSGC model can be adopted right now, there’s no need for any further delay. The contribution could appear within the costings for every arena and stadium event literally from the time you finish reading this article, and from then on financial support starts flowing as soon as those shows take place and the final settlement of the ticketing money is complete. If a rapid process for distribution of the grassroots contribution could be adopted, a NSGC model could be putting money into the grassroots sector from as early as March 2025. To some extent this has already been shown to be achievable, driven by the contributions announced from Sam Fender, Coldplay, Enter Shikari and Katy Perry.

The second advantage of the NSGC model is about control. A voluntary contribution, created by everyone involved in the delivery of an arena or stadium event and delivered into a holding fund such as the proposed LIVE Trust, gives control of the fund to the live industry itself. It means that venues, artists, and promoters, and their representative bodies, can make their case for support directly to people who will understand it. It means we can respond flexibly and quickly to challenges as they arise. Crucially, it means that we can, collectively as an industry, design the distribution and application process ourselves to meet the needs of the sector, directly addressing the skills, experience and knowledge within the grassroots to create a process that is fair, equitable, understandable and achievable for the largest possible scope of potential beneficiaries. A NSGC model, simply put, provides the most flexibility to deliver the most impact to the most people.

The major disadvantage of the NSGC model is the voluntary aspect of it, and the need to translate that voluntary aspect into a mandatory condition. This is plainly a real concern, because even after the grassroots contribution became government policy many companies, organisations and individuals in the music industry have continued to announce events on which it should have been applied and that has not happened. Leaving it voluntary, runs this argument, means that every event has to contain a decision-making process to include it, and that may have impacts on the basic economic model on arena and stadium shows. It is this which is causing some organisations to prefer the Statutory model, feeling that parts of the ecosystem, particularly artists, may be placed under unnecessary pressure, financial as well as emotional, to deliver a voluntary levy.

The SGC model, for these concerned voices, has advantages in terms of enforcement which it is fair to say removes that concern. If the government legislates, runs this theory, no one has to make a decision, everyone is simply required to take part. This is true, but it is hiding a large number of negative outcomes from a SGC which we should stop and consider on behalf of the people we are trying to help and the people we represent.

So let’s consider, first of all, the speed at which a SGC model could be delivered. Assuming that the government patience with a lack of action could be exhausted as early as May 2025, already a date later than a voluntary contribution model could potentially be delivering financial support, the process of creating government legislation to impose a levy on each arena and stadium ticket would commence in late 2025, produce recommendations for action by March 2026, potentially become legislation in Autumn 2026, be adopted by April 2027 (because of financial year planning and budget calendar) and begin to produce income sometime in late 2027 or early 2028, dependent on the date on which impacted shows are announced and subsequently delivered. The date on which such funds would then be delivered would be later than this, certainly into 2028, most likely 12 to 16 weeks after April 2028. A SGC model means financial support arriving for the grassroots sector sometime after July 2028. Even optimistically putting that legislative process into a fast lane and expediting it wouldn’t bring that outcome forward by more than six months.

The second issue for the SGC model is an overarching national problem arising from how such funds would be collected and distributed. If the government uses a statutory mechanism, it will need to use public funding bodies to distribute the funds it receives, most likely the established methods of distribution, Arts Council England, Arts Council Northern Ireland, Creative Wales and Creative Scotland. While I have a very deep respect for those bodies, and I am an admirer of the work they do to support music, there are numerous issues with accepting those bodies as the best way to support the grassroots ecosystem with these very specific funds. I could write a dozen separate articles about each of those issues, but for brevity (and honestly this article is the very summarised version of this debate) let’s do the headlines:

Purpose: Existing funding bodies are guided by the need for additionality as a core funding objective. They have as a main intent that their funding should provoke additional activity that isn’t already happening. This isn’t the main problem the grassroots contribution is intended to combat. We have excellent work that already exists that is being lost because it isn’t financially viable. To distribute the grassroots contribution in the most effective way to tackle this issue, every public funding distribution body would be required to adjust the main intent of its application process to specifically distribute this money in a way that they do not distribute any other funding. It would require the creation of an anomalous grant funding resource and application process which is distinct and different to every other grant available from these public bodies.

Ease of process: This new funding creates an entirely new body of potential applicants. Based on five years of experience of the Arts Council England’s excellent Supporting Grassroots Music Fund, with all the best will in the world I think that even ACE’s own staff would accept that the application process is clunky, rigid, administratively intensive, incomprehensible to many applicants, and in and of itself dissuades applications. I don’t know anyone who applies for funding who doesn’t shudder when they hear the word Grantium, Arts Council England’s application platform. MVT invests heavily in supporting grassroots music venues to make applications to the Supporting Grassroots Music Fund, using experts to guide potential applicants through the process. Roughly half of the potential applicants who come to us never end up making an application because they find the process too complex and simply do not have the time to take part in it. After we have provided all the possible support, advice, help and guidance to those who decide to pursue an application, roughly one third of the applications from venues are still deemed ineligible, which I should note is significantly lower than that from other parts of the grassroots sector. Roughly two thirds of the remaining applications, made within a ring-fenced fund specifically created to try to bring grassroots live music into the circle of public funded support, are declined. The result is that from a potential pool of 100% of venues who might apply for this funding, only 10% are actually able to access funding. To be clear, none of that is Arts Council England’s fault at all, in fact precisely the opposite. ACE have invested tens of thousands, if not hundreds of thousands, of pounds trying to expand the envelope of who can and will apply, and they have, genuinely, been incredibly successful in doing that. After all that work, we are looking at roughly 10% of venues able to receive some financial support. The application, eligibility and success rate for others, artists in particular, is tiny in comparison to that level of success for venues.

Strategy: The SGC model significantly reduces the possibility of strategic intervention into the sector, action taken collectively on the behalf of all so that everyone benefits. The Own Our Venues project is an example of this; across a number of years using music industry expertise and with careful planning between venues, artists and promoters, the grassroots contribution could be used to make this major, significant, long-term intervention into the costs of the sector, in this case ownership and therefore rent, maintenance and insurance costs, gradually reducing or even eliminating costs leaving more in the pot of everyday ticket sales for everyone to share. Permanently. A public funding distribution model would struggle to do this work, since the pressure from individual applications would vastly outweigh the available resources. It may be possible to overcome this, but it is currently difficult to see how a third-party public funding body might decide to make a major intervention into something like, for example, creating artist accommodation, using available space in existing music venues so that artist hotel accommodation costs are massively reduced or even eliminated, while also being asked to directly fund each individual tour and to somehow balance the two. Immediate need would overpower long term interests in a way that would be difficult for a public funding distribution model to resist. Full disclosure, because it’s important, Arts Council England have been major supporters of the Own Our Venues project and invested heavily in it and it would not have happened without them. I think everyone involved in the process of making that happen understands exactly how difficult it was for ACE to deliver that support, and that was without it being part of their open application Supporting Grassroots Venues Fund.

Distribution: This is a particularly important issue which many people in the music industry seem to be completely unaware of when discussing the two models. A SGC model takes the funding into supranational government, i.e. Westminster. Once it is there, the distribution of this funding to the nations, Scotland, Wales and Northern Ireland, would be subject to the Barnett Formula model. Westminster has no power to directly fund Creative Wales, Creative Scotland or Arts Council Northern Ireland, that power is devolved to Senedd, Holyrood and Stormont respectively. The SGC methodology is fraught with potential obstacles to that happening, and in fact there is plenty of evidence that it is highly likely not to be successful. The respective national parliaments receive a general settlement from all sources from Westminster, which in a SGC model would include money from the arena and stadium grassroots contribution. It would then be up to those parliaments to decide how to use that money. In the case of Business Rate Relief, as a live and current example, the finances that resulted from the decision by Westminster to support Business Rate Relief was devolved to the national parliaments, and then used for an entirely different purpose.

Competition: In the event that this new funding should end up in the bank accounts of public funding bodies, what security does the grassroots sector have that it will end up doing the things we intended it to do when this whole process started? The distribution of existing public funding for music is heavily weighted towards Opera and Classical Music. To be exact, even though Arts Council England have made incredibly efforts to try to adjust the distribution model, more than 80% of the public funding for music in the UK is distributed to opera and classical. Do we imagine that once this new funding is in the hands of public distribution bodies those organisations and companies that have an incredibly successful record of application will simply ignore the potential to apply for these funds too? What guarantees do we have that give us the confidence to allow this money to leave our control and fall under the jurisdiction of public funding bodies who will come under enormous pressure to use this funding for other purposes? Again, we have a live current example of this - the Supporting Grassroots Music Fund was originally the Supporting Grassroots Live Music Fund. Once the original fund existed, targeted specifically at venues in that example, cases were made that its distribution should include recording, rehearsing, community projects, nightclubs and festivals. Consequently, while the fund actually increased to £5 million from £1.5 million, the amount actually being received by venues has decreased. Some may rightly feel that all of those areas of work should have funding available to them. The question here is should a contribution from the live industry be financing that fund?

Weighing these factors up, and considering them all properly and their impact on the next steps in creating a grassroots contribution, it is true to say that delivering a Non-Statutory Grassroots Contribution, voluntarily done but understood to be mandatory on every show, is hard work. It involves everyone coming to a consensus, not looking at someone else to make the decision. There are very strong views that oppose that as the solution, particularly because they fear artists being singled out as the people who should be pressured to make that decision. That can be avoided if everyone, agent, manager, artist, promoter, venue, ticketing company, makes the decision together. It has been argued that artists should have no role in that decision-making process, to avoid any possibility that they may be forced to make the decision. I don’t accept that. In fact, I want artists to have much more agency when ticket prices, including charges, fees, levies etc are being discussed. It is always hard to work in a collaborative manner, especially in the music industry, and so people have defaulted to the Statutory Grassroots Contribution as an easier alternative. This approach imagines that the two models of collecting and distributing the money would be equally beneficial to the grassroots sector

The outcome of requesting or campaigning for a Statutory Levy is easier in terms of our short-term, internal, industry challenges. It saves us having to do some hard work and make real compromises now. In the longer term, the problem it immediately solves pales into comparison to the new set of challenges it creates, which are significantly bigger and over which we have no control.

An SGC model results in an incredible delay to when financial support will arrive, with the inevitable consequence that pursuing it means we must accept venues closing down, artists giving up, and promoters going out of business while we wait for support to arrive that could already have been there. Maybe people advocating for it should tell us how many people they would accept leaving the grassroots sector because of that delay or tell us what they are going to do in the short term to avoid that outcome.

It risks money intended to shore up and reset the grassroots sector so it is economically viable being repurposed to try to get venues, artists and promoters to do other things. Perhaps advocates for it should tell us what they think the grassroots sector is doing wrong and what it should do instead or lay out a plan for how they intend to change the arts funding system to recognise existing work in a way it is currently unable to do.

It creates an application process that huge swathes of the sector we all wish to support will simply be unable to take part in or will fail at. Maybe someone who wants to go down this route can explain how many people they would like to see excluded from the support because they favour a process that isn’t designed to include them or tell us about the thought they have put into revolutionising the application process or setting up and financing a body which would ensure everyone has the help and support they need to make applications.

It removes the possibility of long-term, planned, structured investment that makes the sector sustainable in itself in favour of making it permanently reliant on public funding. Possibly the advocates for the SGC approach have a master plan of how they are going to ensure the correct balance of strategic versus short term funding will be distributed, or maybe they have a plan for how the grassroots contribution will rise and rise in the future as costs continue not to be addressed with any strategic planned intervention.

It doesn’t align the money raised with the purpose for which it was raised, with the likely outcome that the grassroots contribution’s impact on the grassroots ecosystem will be diluted as other hands are stuck out asking for support. Perhaps there are already meetings taking place with our colleagues in the ‘high arts’, recorded industries, streaming, education, to get their agreement that this fund is not going to be all things to all people.

And most importantly of all, significant sums of the raised money may not even make it into music or even culture at all; if you’re a venue, artist or promoter based in Scotland, Wales or Northern Ireland the pursuit of a Statutory model is, bluntly, acting directly against your best interests and may produce the result that you never see any benefit from the grassroots contribution. Maybe the advocates for a Statutory levy are already deep in discussion with Holyrood, Senedd and Stormont to avert that outcome on your behalf. If so, they’ve been remarkably quiet about it; as far as I know they haven’t even told any of the elected representatives in the respective parliaments themselves.

A voluntary but mandatory levy, to repeat myself, could be done today. It could be used for the purpose it was intended, and everyone could have a say in how it was purposed, applied for and distributed.

A statutory levy, no matter how easy it may seem or how much it means we don’t have to difficult conversations right now, doesn’t end our problems. It’s the start of them.