UK grassroots music has been left fearful of the future after the recent labour budget.

The UK’s grassroots music and nightclubs sector were already facing some serious challenges in the current economic landscape. Those challenges are now mounting even further following a key decision in Labour’s first budget.

Chancellor Rachel Reeves announced that she would “today provide 40% relief on business rates for the retail, hospitality and leisure industry in 2025-26, up to a cap of £110,000 per business.” You could be forgiven for thinking, from the wording, that this is a generous move. However, the 40% relief is a 35% reduction from the 75% relief rate that was already in place. This reduction is expected to place a £7 million burden on around 350 grassroots venues, which could push many to the brink of closure.

The Music Venue Trust (MVT) and their CEO Mark Davyd are deeply concerned, warning that the changes could lead to job losses and reduced live music activity across the country. More than 12,000 jobs and £250 million in economic activity could be at risk, along with the cancellation of over 75,000 live events.

Furthermore, the Night Time Industries Association (NTIA), which represents UK nightclubs, has highlighted the ongoing crisis in the clubbing sector. According to their data, 37% of nightclubs have shut permanently since 2020, and the trend could continue. NTIA CEO Michael Kill has described in a press release that the current economic environment as one of the toughest the industry has faced in decades. “The extended business rates relief is a minor concession,” he stated, as the sector also faces increases in National Insurance contributions and a rising minimum wage.

The situation facing grassroots venues and nightclubs is increasingly dire, as both sectors face mounting challenges. With tax hikes looming, many venues are struggling to cope with further financial pressure, adding to an already alarming trend of closures. Without significant interventions, such as a ticket levy on large arena events, the situation seems unsustainable.

New artists also find touring financially unfeasible, with this crisis deepening. As Davyd pointed out, the collapse of touring is now at a “crisis point,” and without a shift, many will face insurmountable challenges. Moreover, as smaller venues continue to close, opportunities for emerging artists are shrinking. The absence of a robust development pipeline risks stifling future talent. Politicians are eager to celebrate top-level success stories, but they fail to invest in the groundwork needed for the next generation to thrive.

Looking ahead, the recent Budget clearly reflects a strategy of maintenance (if that) of the current situation rather than bold action, but the conversation doesn’t end there. The clamour for investment continues, and the industry must ensure that any potential support, including a ticket levy, becomes a reality. There has certainly been action from the industry to preserve and rescue grassroots venues. However, calls for government help must continue, as this is what will really change the gloomy course of the future.

The clock is ticking. With only two years to secure meaningful action, the future of live music and clubbing spaces hangs in the balance. It’s now a race against time for both the industry, but mostly the government to act.