Government price cap on ticket resale could backfire, research warns 

A proposed government cap on the resale price of tickets for live events could backfire and expose consumers to further risk, new analysis has warned.

That’s according to the Centre for Economics and Business Research (Cebr), whose research states that the cap could result in a £183 million hit to the UK economy.

The research examined the impact of 25% of current ticket resellers opting not to attend or resell their tickets under a capped pricing regime. This, Cebr says, would reduce spending on travel, hospitality, and other sectors linked to live events, hitting a significant contributor to the UK economy.

The research claims that the secondary ticketing market supports £733 million in annual business turnover and sustains more than 7,700 full-time jobs. A price cap, the report states, could sharply curtail this activity.

Among the risks is an increased chance of fraud as buyers and sellers instead turn to unofficial platforms with no consumer protection. Research conducted by Bradshaw Advisory compared current ticket fraud in the UK, with Ireland and Victoria, Australia, where price caps have been introduced. It found that the UK experienced nearly four times lower ticketing fraud.

Professor Rob Wilson, an expert in applied sport finance, said: ““The research by Cebr highlights that even though an event could sell out, it doesn’t guarantee attendance. If primary buyers don’t feel the effort to resell matches the price, then fans who would be willing to pay the price miss out. Beyond this, conclusions from the independent Waterson Report illustrate that price caps simply do not work and instead drive ticket resales to underground and unregulated channels, where consumers have no protection or recourse if something goes wrong with their purchase.

“Rather than encouraging these dark alleys, the UK should regulate ticket resale platforms to act as safe and transparent marketplaces for buyers and sellers, helping fans, and to fill venues, which has a positive knock-on effect on local businesses and communities.”

Owen Good, Head of Economic Advisory, Cebr – commissioned by Viagogo – said: “Our analysis demonstrates the significant and underreported risks of secondary market price caps. Beyond the frequently discussed risks of increased ticket fraud, which are well evidenced in other countries, the potential cost to the UK economy of even a small increase in unused tickets is extremely significant. Specifically, we find a potential £183 million risk to the UK economy should a quarter of ticket holders who currently resell tickets, instead not attend or resell. Businesses in the hospitality sector, such as in travel, food and drink and accommodation, would be particularly negatively impacted.”