Why the government’s £1.5bn culture bailout still leaves it with an economic headache

The immediate future for restaurants, pubs and clubs around cultural destinations is no less bleak than before. 

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The British government has announced a £1.5bn package of grants and bridging loans to help the arts survive the coronavirus lockdown and recession. 

The bailout has been welcomed by cultural leaders and artists, and is generous by international standards. (There is some confusion arising because other countries announced their packages for the arts at the same time as their overall business support programmes – which is why you are seeing some people talking of a £7bn package in France, for instance.) 

The reason the sector badly needs this money is that most cultural institutions have been told they have to remain shut and many more will be unable to open in a viable way for some time to come. It makes economic sense, too: our genuinely world-leading creative industries are magnets for tourism, both domestic and international, and are a major contributor to the British economy, directly or indirectly.

But that the bailout is required highlights the difficulty – perhaps the impossibility – of the government’s plan to reopen the economy. While you can fairly argue that even our current rate of reopening should be delayed until we have a fully functioning system to test, trace and isolate new cases of Covid-19, the government has opted to keep a number of institutions shut because of their potential to spread the virus.  

The problem, though, is that the benefits of the arts aren’t simply direct. When do I go to the pub? Generally before going to a gig or a concert. It’s not a coincidence that so many of the country's restaurants cluster around theatres and concert halls. Protecting our artistic institutions makes it easier for new restaurants, pubs and clubs to emerge in the areas around them once they can reopen as normal. But it doesn’t mean that the immediate future for restaurants, pubs and clubs around cultural destinations around the UK is any less bleak this morning than it was last night – and leaves Rishi Sunak with a hell of a task for his mini-Budget on Wednesday if the country's restaurants and bars aren't to all go the way of Café Rouge. 

Stephen Bush is political editor of the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.

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