March/April 2022

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EVENTS GETTY IMAGES INDUSTRY COMMENT Seeing Red Chairman of the Events Industry Forum, Steve Heap, on the banning of red diesel for events IN THIS spring’s budget the chancellor had the opportunity to make a difference the outdoor events industry. 5p off the fuel tax (yet to be confirmed that it will apply to white diesel and biofuels) does not make enough difference to really help us. So, whilst we recognise that the government announced the banning of red diesel for festival sites two years ago it didn’t actually hit home at the time and so is coming as a bit of a shock to an already dented industry. With over 20% rises in equipment costs recovering from two years off for Covid, no pandemic insurance (HM government proposal not fit for purpose), staff shortages due to Brexit and now a doubling of costs for power to our stages, “OTHER PARTS OF THE BUDGET DID NOTHING FOR THE FESTIVAL SCENE, OTHER THAN CONFIRM IT IS GOING TO BE A TOUGH YEAR WITH PEOPLE’S DISPOSABLE INCOME STRETCHED TO THE LIMITS” 2022 will not be the year of recovery we had hoped for but will be the toughest year as all the above is being paid from a 2019 ticket price revenue carried over for most festivals. The VAT holiday is finished. We fought for 5%, then 12.5% and we continue to fight to keep it down low, but the chancellor has put it back to 20%. We were very willing to work with the government on reducing our carbon footprint, and still are, and gradually we will switch to renewable and alternative energies, but now the chancellor has taxed those as well, up to the same level as white diesel. Generator companies are all cleaning out their tanks to switch to white diesel so campaigning for an extension to red diesel is not much use, and it doesn’t meet our industry’s commitment to carbon reduction by 2025 (see Vision2025 report). Other parts of the budget did nothing 56 WWW.OPENAIRBUSINESS.COM
EVENTS for the festival scene, other than confirm it is going to be a tough year with people’s disposable income stretched to the limits. The sun is shining, the music is ready, all we need now is customers who can afford to come. Mr Sunak will be hearing from us again... I would suggest that readers join with many others in the events industry and write to the chancellor, inviting him to join with us to meet government climate change targets. He can help us do this by taking fuel duty off biofuels and alternatives as well as taking off the VAT. This would help our industry in this recovery year and give us a chance to get fuels sorted without further 2022 expenses. From the HAE EHA Changes to the law concerning the use of red diesel came into effect on 1 April, affecting thousands of hire companies across the UK. Hire Association Europe and Event Hire Association (HAE EHA) is urging its members and the wider hire industry to ensure they are fully aware of the changes to avoid finding themselves on the wrong side of the law. Previously, rebated gas oil (red diesel) and rebated biofuels could be legally used for any machine which is not a road vehicle eg. mobile generators. From 1 April, this entitlement was removed for all but a handful of specific sectors, including farming, forestry and communitybased landscaping such as hedge and verge cutting. Any individual found guilty of breaching the new regulations may be subject to criminal sanctions and fines, and HMRC can also seize vehicles and machines found to be running unlawfully on red diesel. There is no requirement to flush out engines, and any rebated fuel still in tanks can be used up after 1 April, so long as it can be proved that it was put into the vehicle or machine legally prior to the changeover date. HAE EHA has taken a number of actions including creating revised terms and conditions of hire and putting in place training and general guidance. Anyone who would like to know more about how the changes in regulations might affect them can get in touch with HAE EHA on 0121 380 4600. Yet More Cost Rob Chapman, director of Craft in Focus which runs some of the country’s largest craft and design fairs, illustrates the cost implications of banning red diesel AS THE organiser of some of the country’s largest craft and design fairs we are very concerned about the government’s decision to prohibit the use of red diesel at events. Over the last two years the event industry has been among the hardest hit. We all understand the need to cut greenhouse gases, and the removal of use of red diesel is being billed as a way forward to encourage greener options and reduce the use of fuel. But what are the alternatives? As yet, there are none that are cost effective, so our running costs will just have to increase. All our events require diesel generators to provide power, but even with the change to low energy equipment, the amount of fuel used is still significant. The removal of red diesel for generators will increase our costs by around £800 or so for most summer based events. The problem really hits hardest at our winter events where our heating units have been fuelled by red diesel. Three years ago at our November fair (our largest event) we had almost daily fuel deliveries as the heating used over 10,000 litres of fuel. If we had not had access to red diesel the increase would have been around £4,500. We could change to Kerosene for the heating, which is cheaper than white diesel, but would require separate storage and delivery as we still need diesel for the generators. The extra delivery and storage adds more cost again. If we use white diesel then we will also have to increase security as keeping the fuel on site is likely to attract unwanted attention, so yet more costs. As with most companies we are already running to tight budgets, but this addition makes a huge impact to the viability of our autumn and winter events. Yet again the events industry is being hit by lack of government thought. GETTY IMAGES WWW.OPENAIRBUSINESS.COM 57
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March/April 2022

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