The Federation responds to today’s budget statement

March 11, 2020

Responding to today's budget announcement, Caroline Norbury, CEO of Creative Industries Federation and Creative England said:

As a sector primarily comprised of small businesses, and with a significant self-employed workforce, we welcome government’s emergency measures to support those SMEs and freelancers dealing with the fallout from coronavirus.

The self-employed will benefit from a designated helpline, easier access to benefits, removal of the Universal Credit income floor and access to the government’s £500 million hardship fund. A third of our sector is freelance (compared to one in seven nationally) and it is vital that they are not forced to choose between their income and their health. 

Positive measures for small and medium-sized businesses (99.9% of our sector) include statutory sick pay refunded by government in full up to 14 days, £3000 cash grants and easier access to loans. However, given that creative businesses typically access finance in a number of different ways, government must ensure that these loans are truly accessible to our sector. 

As the situation develops, it is imperative that government offers support to those creative organisations reliant on audiences, visitors and participation, including museums, galleries, cinemas, theatres, cultural organisations and live music events.  Freelancers working with these sectors may also face significant disruption to their livelihoods. It is vital they are supported.

We welcome news that business rate relief will be extended from music venues and cinemas to incorporate a broad range of cultural, music and heritage spaces, and that it will be increased to 100% (for the year) - something we, and the sector, have long been calling for and outlined in our Creative Industries Manifesto back in December. The axing of VAT on ebooks and digital newspapers is also welcome news. 

It is encouraging to see the strengthening of support for the self-employed, including help navigating the tax system and action on late payments, both of which the Creative Industries Federation has been advocating.

The announced investment in infrastructure to ‘level up’ the country is welcome but this must be accompanied with investment in, and a far more strategic approach to, education, skills and training. We look forward to engaging with government on the Arts Premium, but will continue to call on government to put creativity at the heart of the curriculum, ensuring that all young people have access to a creative education.

Creative SMEs across the UK still face significant financial challenges, particularly as European funding programmes such as EU structural funds and Creative Europe come to an end. These have provided vital access to finance, markets, skills development and employment, as well as important investment in cultural and business infrastructure. Government’s commitment to match existing levels of EU structural fund support is welcome, however it is vital that they consult on plans for the upcoming UK Shared Prosperity Fund as soon as possible. Replacement for Creative Europe funding and support must similarly be confirmed as a matter of urgency, and well ahead of the Spending Review in the Autumn.

Other measures announced include:

- Confirmation of £250 million Cultural Investment Fund for culture, heritage, local museums, and neighbourhood libraries. Of this, £90 million will be made available from April for a Cultural Development Fund that will support cultural regeneration proposals outside of London.

- British Library to receive £13m to expand their network of Business and Intellectual Property Centres.

- £4.8 million to expand the work of the British Film Commission to promote the UK as a destination of choice for studio space investment.

- £180 million over six years for a new state-of-the-art storage and research facility for the Natural History Museum at Harwell Science and Innovation Campus.

- £27 million for critical maintenance work on the National Museums’ estates.

- Business support and access to finance for SMEs will be enabled further through £10m for Growth Hubs and the extension of the Start-Up Loans Programme to 2021-22.

- £5 billion to support the rollout of gigabit-capable broadband in the most difficult to reach 20% of the country, so that all areas are able to benefit.

- Further support for exporters by extending and increasing the lending capacity of UK Export Finance (UKEF). This will make permanent the additional £2 billion provided to UKEF at Budget 2018.

- Confirmation that the 2% Digital Services Tax will be implemented from 1 April 2020.

- An increase in public R&D investment to £22 billion per year by 2024-25. This takes direct support for R&D to 0.8% of GDP with government reaffirming their commitment for economy-wide R&D support to reach 2.4% by 2027.

- Government will look at how to improve the working of the Apprenticeship Levy, to support large and small employers in meeting the long-term skills needs of the economy. In the meantime, government has committed to ensure that sufficient funding is made available in 2020-21 to support an increase in the number of new high-quality apprenticeships in small and medium-sized businesses.

- Commitment to refurbish FE colleges with £1.5bn dedicated funding over the next five years and confirmation of a new £2.5 billion National Skills Fund to improve adult skills.

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