Strangely enough, the day after posting icame across this bit of evidence from the association of independent festivals to the govt select committee looking into festivals ( worth a look if you’re interested in festivals) which answers the question.. basically it should be held separately and usually is, but some festivals have been dipping into it to keep themselves afloat...
<p>MPs will examine what support is needed for UK music festivals to return in 2021, as they consider the economic and cultural impact of festivals across the country.</p> <p>With the vast majority of festivals cancelled in 2020 owing to COVID-19, the sector’s revenues have dropped by 90%. The...
committees.parliament.uk
2. Julie Elliot MP raised the point around risk to the consumer in the event of festivals not taking place and was simply told that customers will be able to get refunds from ticketing companies as the point of purchase. It should be noted that in reality, many festival companies draw down advance ticket money from ticketing companies. As detailed in our post Round 1 CRF report submitted to DCMS in November, some festivals who didn’t receive funding are on the brink of imminent collapse and have exhausted (or being rejected for) other options including repayable finance such as CBILS and Bounce Back loans. These include high profile festivals, many of whom can be considered to occupy a unique and in some cases leadership position in their regions, generating significant direct and indirect economic impacts. Significantly, our survey also revealed that these festivals who were unsuccessful were collectively holding over £10m in ‘drawn down’ ticket retention income, over £800k per festival on average, illustrating the extent of the detriment to the consumer if these businesses collapse- while these funds should be ring fenced and essentially held in escrow in the event of needing to make further refunds, customers would not necessarily be able to access a refund in the event of business collapse. This level of financial risk to the consumer is a distinguishing factor between festivals and, for example grassroots venues due to the high ticket price- and I believe strengthens the argument for financial support of the sector.
at self 
