During the current public health crisis, community radio can provide a reassuring local voice to millions of people. However, many community stations are facing significant financial challenges as a result of the Covid-19 pandemic.
In response, the government announced £400,000 of emergency cash funding to help stations facing severe financial difficulty to meet the core costs of providing vital programming to local communities.
The Community Radio Fund Panel (‘the Panel’), which is independent from Ofcom in its decision-making, met on Wednesday 27 May 2020 to consider applications for emergency funding grants.
The Panel considered each application and awarded funding based on the information provided, and with reference to the Community Radio Fund (‘the Fund’) guidance notes. For each grant bid, the Panel decided whether to make a full award, a partial award or not to award any funding.
At the meeting:
- 202 applications for grants were considered;
- The funding requested by applicants totalled £1,820,843;
- The total amount available was £406,810;
- 81 applicants – representing nearly one-third of the community radio sector - were awarded grants totalling £333,152; and,
- The grants ranged from £812 to £12,075, with an average of £4,113.
The Panel awarded as many grants as possible in accordance with the strict eligibility criteria and guidance issued.
Ofcom is, however, inviting applications for a further emergency funding round in approximately six weeks’ time, with a view to awarding the outstanding funds available.
A statement from the Panel explaining the factors they took into account when making their decisions is below. Unsuccessful applicants, who may wish to reapply for funding in the second round, may find this feedback useful. Any further queries can be submitted to Communityradiofund@ofcom.org.uk with an accompanying contact number for a member of the team to call you. We will respond to any queries as quickly as we can, but please note it may take us some time to respond should we receive multiple requests from unsuccessful applicants.
In making 81 awards, the Panel offered financial support to three times as many stations than in previous years, although the average amount awarded was duly lower. In the previous year (2019-2020) there were 72 applications for funding, and 26 applicants were awarded grants. The average award during this year was £16,464.
The Panel therefore had to consider three times as many applications for funding in this round, while the total amount of funding requested was only 25% higher than in the previous year.
The approach the Panel took in assessing applications and reaching their decisions is set out below:
- The Panel favoured proposals which made a strong case that they required urgent support from the Fund.
The Panel noted DCMS advice that the Fund should be used to provide emergency funding to support stations that would otherwise be unable to continue operation due to the coronavirus outbreak.
- The Panel prioritised proposals from stations which are currently disproportionately reliant on precarious sources of funding, such as advertising, training or events income rather than those stations which benefit from significant grant funding.
It is clear that many stations have suffered difficulties as a result of declining advertising spend, particularly those stations who rely upon advertising from local shops and services which have been closed during this period. Furthermore, many community radio stations rely upon income from training and outside events such as outside broadcasting, and these activities have ceased.
- The Panel favoured proposals from those stations which have reviewed their existing operations and exhausted other potential sources of funding.
Many stations have already taken urgent action to minimise costs and negotiate payment holidays or deferrals. Many have applied for emergency funding through existing alternative routes, such as furloughing staff or benefiting from a Small Business Support Grant. The Panel noted that some stations have not significantly reviewed their operations and are maintaining spending at relatively high levels (for instance still paying show fees to many of their presenters) and some have not applied for alternative sources of funding.
- The Panel decided to prioritise a wide range of stations to support the viability of the sector as a whole, and chose to fund those stations where a lower amount of money could make a huge difference to keeping that station on air.
The Panel also noted that several stations are suffering from structural funding issues, and that emergency funding will not solve these. Some stations also requested extremely high levels of emergency funding (up to £100,000), which, given the amount available to administer, could not be supported. The Panel also recognised that some stations are part of wider organisations which may be able to offer financial support. Some also have no financial reserves while others have larger unrestricted reserves to draw upon.
- The Panel offered several stations small emergency grants to purchase equipment to enable remote working.
The Panel was impressed by the inventiveness shown by many stations in endeavouring to stay on air and provide a useful service to their communities at this challenging time, when many of their volunteers are considered ‘vulnerable’ and are self-shielding.
- Given the constantly changing situation and the difficulties in predicting the likely long-term impact on station revenue, the Panel tended to fund fixed costs such as rent, rates and utilities, over a three-six-month period, where those stations have been unable to negotiate extended payment holidays or deferrals, rather than funding projected revenue shortfalls in the long term.
In choosing which activities to support, the Panel noted that some stations asked for funding for specific short-term activities, while others asked the Fund to support a forecast shortfall in revenue for a period of up to one year.
Given the fluidity of the situation, however, the Panel considered it advisable to hold back a small proportion of the budget in order to hold a further limited funding round with specific criteria in six weeks’ time. This gives stations further opportunity to consider the likely medium-term impact on their business, and to review their operations.
- In order to be fair to all applicants, the Panel favoured applications where sufficient information was provided to enable the Panel to make an informed decision.
A small but significant number of applications (approximately ten per cent) did not follow the guidance in completing their applications: using incorrect forms, not supplying required information such as statutory accounts or supplying information after the deadline.
