The council don't have discretion in situations like this, unfortunately, Folkiedave, cos they are merely administrating proper statutory law. The organisers only had to give 10 working days notice - it seems a bit of a poor do if they couldn't get the form in on time. In any case, it should only affect stages which are in areas which aren't already covered by existing Premises Licenses (with the live music element covered). Presumably pubs and clubs (if they use these as venues) will already be covered and the article said that at least one of the outdoor stages was covered by a License taken out for the boat show.   
I'm sure it will work out fine in the end and this will just be a minor hiccup.