Politics

Coalition rejects bid to Covid-proof Australia’s live performance sector | Culture

The Morrison government has rejected a call by the Greens and Labor to provide Australia’s live performance sector with an insurance guarantee to guard against future cancellations and border closures due to Covid.

On Friday a report resulting from an inquiry into the feasibility of a new insurance scheme for the performing arts sector was tabled in parliament.

The Senate committee inquiry was called after senator Sarah Hanson-Young announced the Greens’ intention to introduce a private member’s bill calling for a government-run insurance guarantee to future-proof the industry.

The report recommended the bill not be supported because it would require the federal government to provide insurance against state government actions such as public health orders that would necessitate the cancellation of an event.

The report also said the arts sector had received “significant funding” from federal, state and territory governments during the pandemic and as public health orders, lockdowns and travel restrictions had begun to ease, “the arts and entertainment sector has shown the capacity to recover”.

The recommendation not to support the bill was voted against by two Labor senators and one Green senator, who issued a joint dissenting report on Friday.

Three Coalition senators voted in favour of the recommendation, with Liberal senator Andrew Bragg using his deciding vote as chair.

Tim Minchin’s live concert to open the 2021 Perth International Festival was cancelled due to a sudden lockdown in March.
Tim Minchin’s live concert was set to open the 2021 Perth festival but was cancelled due to a sudden lockdown in March. Photograph: BMG/Getty Images

The complexities of federalism used to justify the report’s conclusion was an issue proponents of the insurance scheme had used during committee hearings to justify the bill’s necessity.

John Watson, representing the music copyright agency Apra Amcos and Eleven Music, told the committee the live performance industry needed a national approach because touring was national.

“The restrictions might be state-based [but] it doesn’t really help if you can go ahead with your gig in New South Wales but your drummer can’t get in from Victoria or Queensland,” he said.

Watson, along with other industry leaders giving evidence during the inquiry, argued there was proof of a market failure when it came to insuring live events against Covid outbreaks, border closures, lockdowns and last-minute cancellation because there was no insurance product on the market available to insure against such events.

In many European countries and in the UK, governments have stepped in to create such a product. The British government introduced its £750m live events reinsurance scheme in August, creating partnerships with insurers to allow promoters and performers to purchase cover against future government-enforced cancellations due to the pandemic.

Evelyn Richardson, the chief executive of Live Performance Australia, told the committee that pre-Covid, the costs of insurance premiums against cancellations were already significant, ranging from $50,000 for a modest commercial theatre production to $750,000 for a major concert tour or festival.

“The inability to insure [against Covid] is a major market failure, and there is a role for governments to intervene,” she said.

Treasury argued the lack of a Covid-proof insurance product was not so much a market failure as a “gap in the market”.

According to the Department of Prime Minister and Cabinet, market failure alone is not an argument for government intervention, particularly “if the failure does not have a material impact on the functioning of the wider market”.

“But in the event of a market distortion leading to inefficient or inequitable outcomes, the cost of intervention may be justified.”

Hanson-Young said artists, musicians and their crews had been devastated by another season of events, festivals, concerts, exhibitions and live performances being cancelled without insurance protection.

The contribution the sector made to the Australian economy annually dropped from$36.5bn in 2019 to $12.8bn in 2020, with lockdowns and border closures affecting an estimated 122,000 full-time equivalent workers in the sector.

“A federal insurance guarantee will plug this massive hole in the insurance market and help get our shows back on the road well into the future,” Hanson-Young said.

“The live performance sector isn’t asking for a handout, it is asking for a product that isn’t available to them and one that is fit for purpose.

“Tours traverse state borders, it is quite obvious a national approach to helping the industry is needed.”

A spokesperson for the arts minister, Paul Fletcher, said he was examining the report.

“As we have consistently said, it is decisions by state government health authorities which trigger the business losses faced by producers of arts and entertainment events,” Fletcher’s office said in a statement.

“Therefore, it is state governments which are best placed to provide cover against this kind of risk.”

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