London’s West End faces 97% slump in added value, study warns


The economic output of central London’s arts and culture sector faces a severe slump if the government repeatedly imposes tough coronavirus restrictions, according to a new report.

The study commissioned by the Heart of London Business Alliance, which represents about 500 of the West End’s best known businesses including Fortnum & Mason and the Ritz, warns about the devastating effect of Covid-19 restrictions on London’s arts and culture businesses.

Following the March lockdown, the government gave the go-ahead to the reopening of museums and theatres during the summer, but they have to operate under social distancing measures that have prevented some from resuming operations.

The Heart of London Business Alliance commissioned a report by Arup, a consultancy, into how the arts and culture sector would fare over the next four years under various pandemic-related scenarios. 

Arts and culture businesses in the West End could see gross value added (GVA), an economic measure of the value of goods and services produced, fall by 97 per cent by 2024, compared to its 2019 level, in the worst scenario involving repeat and severe economic restrictions to curb Covid-19.

The West End arts and culture sector’s GVA was about £4.9bn in 2019, according to Arup, meaning that in the worst scenario, it would fall to just £100m by 2024.

Even in the best scenario, involving a return to normality, Arup estimated that West End GVA will fall by 10 per cent by 2024 compared to 2019.

With seasonal Covid-19 and economic restrictions that fell short of further lockdowns, the impact on West End GVA would still be significant, involving a drop of 82 per cent by 2024. 

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Tony Travers, director of the institute of public affairs at the London School of Economics, said the “core of London’s West End has never faced a threat like the current one”. 

If West End audiences do not return it “is inconceivable that British theatre could survive at anything like its current scale”, said Mr Travers.

The Heart of London Business Alliance has urged the government to introduce a business rates holiday for all arts and culture venues until March 2022, and provide funding to help make them Covid-19 secure.

Other measures proposed include a government-funded “go out to help out” discount scheme for the arts and culture sector similar to the Treasury’s “eat out to help out” programme that bolstered pubs and restaurants in August.

Stuart Murphy, chief executive of the English National Opera, said its home at the London Coliseum would reopen for audiences at the start of November, with social distancing allowing about 1,200 people to attend.

“We have to get people back to city centres,” he added, pointing to the knock on effects to other industries such as hospitality.



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