PARLIAMENTARY DEBATE
Film Industry - 9 October 2024 (Commons/Commons Chamber)
Debate Detail
The UK has some special advantages that give us a natural competitive edge. Thanks to the creativity and imagination of our authors, playwrights and publishers, we have some of the best stories to tell and take to the screen, helped by some of the best story tellers in the world—the directors, scriptwriters and cinematographers —and against some of the most incredible backdrops, from the Welsh valleys to the north-east coastline, as well as acting talent that is second to none and that breathes life into those stories. Our film industry is one of our great economic and cultural success stories. It is worth £1.36 billion and employs more than 195,000 people, and it has created true icons such as James Bond, Harry Potter and my personal favourite, Paddington Bear.
Our Government have three aims for our film industry. First, we want to attract the investment for UK film makers to make the best films in the world. Secondly, we want UK audiences to see films that reflect their lives and their communities. That means telling a wide diversity of British stories that draws on the rich cultural inheritance in every region and nation. Thirdly, we want the UK to be the best place in the world to make films, because we have the right ingredients: the investment, the talent, the technical skills, the sound stages, the creative imagination, and the right fiscal and regulatory environment. That is why this Government will do everything in our power to ensure that the fiscal and regulatory environment matches the ambition of film makers and studios around the world. We want them to invest in great British film making.
However, the key to maintaining that advantage is an internationally competitive tax regime, and I think that is beyond party politics. As Members will know, tax incentives for film were first introduced by the last Labour Government in 2007, and the previous Conservative Government followed suit with the announcement of a planned UK independent film tax credit in the last spring Budget. We have heard loud and clear the industry’s concerns that any further delays to introducing this secondary legislation, even to the end of the month, may mean that investments in UK independent films are lost. So I am glad to announce that we have today laid the necessary statutory instrument, under the negative process, for the independent film tax credit to take effect. It means that eligible films with a budget of up to £23.5 million can claim enhanced audiovisual expenditure credit at a rate of 53% on their qualifying expenditure up to £15 million. That is higher than the standard 34% rate for other films. The regulations set out the eligibility criteria for film production companies, who can apply from 30 October.
This Government do not underestimate how important this tax credit is. Big blockbuster movies are an important part of the mix, but independent films are every bit as important, both for the British talent that they allow to shine and for the untold stories that they bring into the spotlight. Too often, people do not see themselves and their community reflected in the stories we tell ourselves about ourselves as a nation, and this Government are determined that will change.
Later today, the 68th London film festival will open with the world premiere of “Blitz”, written, directed and produced by one of our most successful British directors, Steve McQueen. Set in England during world war two, it is an example of exactly what film can do. It brings together top talent on screen and off, and it showcases the nation’s history through storytelling and highlights on screen our beautiful country, from London’s east end to Hull’s old town. Our independent sector has produced films such as “Pride”, “The King’s Speech” and “Bend It Like Beckham”, which show our heritage, our communities and our culture to the world and act as a springboard from the grassroots for world-class UK talent on screen and behind the scenes.
While major film production has flourished, smaller-budget independent films have not received sufficient support over the past decade. They face multiple challenges, including rising production costs, crew shortages and declining revenues, which have hampered the growth of this vital sector. While too much of our creative industries has traditionally been concentrated in just one part of our country, independent film thrives everywhere, given the chance. This uplift will not only boost creativity but create jobs, growth and investment in every nation and region. Through that, we will help the independent film sector to reach its full potential.
While the uplift has been designed to support and target British independent film makers, I am glad to say that it is also open to qualifying official co-productions, because film and television co-production is a key way in which the UK increases its cultural ties and collaboration with Europe and the rest of the world.
This Government will go further still to support this critical industry. The skills shortage that has been ignored for too long acts as a break on the ambitions of this incredible sector. That is why this Government launched Skills England to bring about the skills we need for a decade of national renewal of our communities, business and country. We will focus apprenticeships once more on young people to set them up to succeed and to help fill the 25,000 vacancies in the creative sector. The Secretary of State for Education is overhauling the apprenticeship levy to provide better career opportunities for young people, building on the success of existing high-quality apprenticeships in the creative industries, and we are working closely with Skills England to ensure that the new flexibilities announced by the Prime Minister last month offer shorter apprenticeships and an improved offer for a creative skills pathway for young people embarking on careers in this sector. Every child should have the chance to live a richer, larger life and to consider a career in the arts.
In addition, the Ministry of Housing, Communities and Local Government is keeping the Government’s mission to deliver economic growth at front of mind when making decisions about planning applications. I am pleased to announce to the House that yesterday MHCLG recovered an application for planning permission for Marlow film studios in Buckinghamshire. The merits of that application will now be reviewed by its Ministers in detail before they reach a decision.
Finally, next week the Government will host the international investment summit, where industry leaders, investors and businesses from across the world will come together to put the UK back at the global table and to kick-start a decade of economic renewal. As a critical part of that, our creative industries will be at the summit’s heart. This Government are committed to ensuring that the UK is a first-choice destination for film production. We are backing up those words with actions today. Britain is open for business, and creativity is back at its heart. I commend this statement to the House.
I congratulate the Secretary of State on a tremendous achievement. With 100 days of Labour looming, she has the honour on day 97 of announcing Labour’s first decent policy. We know it is decent, because it is a Conservative policy. Do not be fooled: today’s statutory instrument puts into effect the extra support for independent film that we, the Conservatives, brought in at the March Budget. Our announcement followed months of careful work with brilliant organisations such as Pact and the British Film Institute, and it was welcomed by industry titans such as Chris Nolan, Barbara Broccoli, Steve McQueen and Ridley Scott. At the time, the BFI dubbed it
“a game changer for UK filmmakers”
and British storytelling, and
“the most significant policy intervention since the 1990s.”
The Chancellor and the Culture Secretary now say it is all part of their plan for growth, but it was our plan for growth. As far as I know, they have not got one. Even their plan for tax seems to be falling apart, as the socialist utopia of opposition hits the reality of governing. The policy was the latest in a seriously successful suite of Conservative-created tax reliefs that mean this new Labour Government inherit a thriving industry to steward. I am genuinely glad that something has finally been announced ahead of the London film festival. It is a tremendous showcase of UK talent that we backed with £1.7 million from our creative sector vision. Through it, we have gifted the Culture Secretary something to say, the Chancellor something to back instead of tax, the Prime Minister another sparkling event to go to and the Home Secretary a new police escort to fund, but it has taken too long. The consistent feedback we are getting from every DCMS sector is simple: what is going on? Where is the plan?
If the Culture Secretary gets invited to the latest gallery opening, will she finally commit to continuing the museums and galleries exhibition tax relief at the extended rate, as we committed to in the March Budget? If she gets invited on another rollercoaster, will she give clarity on whether we will secure investment in a new film theme park in Bedfordshire in time for the investment summit? If the Prime Minister gets a bit more time in Arsenal’s exec suite, will the footballing world get clarity on how this Government wish to regulate it? Can she reply to my letter, sent weeks ago, that asked all these questions and more?
In her media round this morning, the Secretary of State claimed that Gordon Brown was behind the success of the British film industry. Does the Secretary of State remember that in 2013, 2014, 2015, 2016, 2022 and 2024, Labour voted against our film, video game and TV tax reliefs? Does she accept that regardless of the positive investment environment we created, it is the ingenuity of Britain’s film makers, costume designers, writers, runners, researchers, post-production talent and actors who have made the UK the best place in the world to make films? We cannot take it for granted. With the Irish Government announcing last week that Ireland will receive its own boosted tax incentives for films under €20 million, can she commit to keeping a close eye on international competitors, so that we do not lose our edge?
Finally, the Culture Secretary’s press release states:
“The new measures are the latest in a series of interventions from the government to drive growth, which is creating the conditions for confident investment and trusted partnership with business.”
Can she name any other growth measures that Labour has revealed that are not rebadged Conservative policies and announcements, or things that will not drive growth, which is to say, anything announced by Ed Miliband?
If I may, I will highlight a few areas where we are in agreement. First, I think we are in agreement that today’s announcement is a thoroughly good thing for the British film industry. Secondly, I think we are in agreement that a number of the initiatives that this Government are taking forward—including the football Bill that she referenced and various other issues relating to the competitiveness of our creative industries on the global stage—are welcome and should receive cross-party support.
The hon. Lady mentioned the fact that the Conservative Government brought in this independent film tax credit at the last Budget. If that were true, we would not be needing to legislate today. The truth is that the Conservative Government did what the Conservative Government did for 14 years: they talked a good game and then did absolutely nothing to deliver for the people of this country. She says that we voted against film tax credits, but the truth, as she well knows, is that we did not vote against them. They were our idea and our initiative in 2007. In fact, it was her party that opposed them in the first place. If they had had their way in 2007, our British film industry would not be where it is today, which is rivalling Hollywood as one of the best film industries in the world. She knows full well that we supported every one of the measures that, after years of opposing them—they had to be dragged kicking and screaming by the film industry—the Conservatives belatedly came to support. She also knows that we voted against successive Conservative Finance Bills because, as we are discovering now that we have had a chance to open the books, there was no money attached to any of the measures. It was a hoax and a con trick practised on the British people.
I have a great deal of respect for the hon. Lady, and I am grateful to her not just for her welcome today and her warm words but for the support that she and others on the Opposition Benches have given me and the team to take up the mantle. But if I had left a sector with 25,000 vacancies that it could not fill, a legacy of creativity being erased from our communities and our classrooms and, most of all, a £22 billion economic black hole that working-class people are paying the price for up and down the country—all of that—and then had such a resounding rejection from the electorate only a few months ago, I would be speaking with a little bit more humility from the Dispatch Box.
This is a positive statement. The Liberal Democrats welcome the announcement, as we did when it was announced in the Finance Bill earlier this year. It is good to see the Government following through on that. The creative industries are the heartbeat of British life and the film industry is a powerful tool for soft power and economic growth, too. This is a first step, but our view is that wider tax relief measures should be considered in future. We need to address the skills gap by reforming the apprenticeship levy, as has been mentioned—that is a positive thing. We should transform it into a training and skills levy.
We need to address the barriers to finance suffered by so many in the creative industries. We hear about that regularly, particularly from smaller operations. We believe that creative enterprise zones will help to regenerate cultural output across our regions and nations, and we believe that this country should apply to join Creative Europe to boost the funding options available.
I have three questions. In the light of Ireland’s announcement, is the Secretary of State satisfied that the measure announced today gives us enough of an advantage over our neighbours in Europe? On Europe, have the Government considered the merits of enabling full participation in Creative Europe? Finally, what steps are the Government taking to extend access to finance for the creative industries?
I welcome the issues that the hon. Member raised, particularly on finance. We know that there is a major gap in the amount of finance that the creative industries can raise in different parts of the country. We also know that the gender gap is a particular problem, and that is something that our Government are determined to address. On Creative Europe, he will doubtless know that the Minister for the Cabinet Office is currently involved in negotiations with Europe to try to build on the paper-thin agreement that the last Government secured. We are keen to secure a closer relationship with our European friends and neighbours, but obviously those negotiations are ongoing so I cannot comment on that at the present time.
I welcome the statement. Will the Secretary of State congratulate Steve Rotheram, the Mayor of the Liverpool city region, who is putting £17 million into the Hollywood of the north project at the Littlewoods building, which will create 4,000 jobs? That is investment from a Labour mayor, supported by my hon. Friend the Member for Liverpool Wavertree (Paula Barker)—a Labour Member of Parliament—and by a Labour council. Labour, Labour, Labour supporting the film industry.
I share my hon. Friend’s enthusiasm for the work that Steve Rotheram is leading in Merseyside. Just a few years ago, the mayor took me to see the newly opened Shakespeare North playhouse, an incredible project just a few streets from where he grew up. He was told by the previous Government that nobody would come to see Shakespeare in the north of England—how wrong they were.
I am keen to support the work that Steve Rotheram, Tracy Brabin and other mayors in the north of England are doing through One Creative North. It is the most exciting project to create a cultural corridor in the north of England, building on the assets and talent that exist in every part of our country. Parts of the country have not been heard for far too long, but with this Labour Government they will be heard.
When does the Secretary of State expect the Government to confirm the introduction of the visual effects tax credits? They were also announced in the Budget and have been consulted on, and they are also desperately needed and urgent. I would be grateful for an urgent response on that. Does she have any plans to look at the enterprise investment scheme for film and high-end TV? That is also much needed to get investment into British independent film and television. Finally, she spoke about the investment summit. Will she please confirm that the creative industries’ role in that will not just be to add the stardust? They are such a fundamental and integral part of our industrial strategy and they contribute so much to the British economy, so they must be there as a central focal point of her Government’s future industrial strategy.
The hon. Member is absolutely right about the visual effects tax credit. We understand how important these reliefs are to the industry and we plan to provide an update as soon as we can, although we have the spending review imminently, and there is work ongoing to ensure that we get right our offer to the creative industries as a whole. On the enterprise investment scheme for high-end TV, I am afraid that the answer is similar, but I would welcome the chance to keep talking to the hon. Member and to members of the Committee, once she has some. On the investment summit, I appreciate her calling me stardust—I do not think I have ever been called stardust before—or did she mean the people that we might bring along? She and I share the view that the creative industries are absolutely central to our economic growth agenda, and I am really pleased that that view is shared by the Prime Minister, the Chancellor of the Exchequer and the Secretary of State for Business and Trade. She will see that at the investment summit next week and in the work that we will release over the next few weeks.
I noted the right hon. Gentleman’s point about the copyright protection regime. In the Government’s view, artificial intelligence presents significant opportunities, but it also poses serious challenges for creative industries. I am delighted to say that our Minister of State—my hon. friend the Minister for Creative Industries, Arts and Tourism—is also a Minister of State at the Department for Science, Innovation and Technology, and he is working at pace to try to resolve these issues.
Cardiff is an incredible hub of creativity. Cardiff’s film studios, among others, are showing exactly what can be done, and this Government are absolutely determined to do everything we can to support this incredible industry. As I said to my hon. Friend the Member for Eltham and Chislehurst (Clive Efford), that includes making sure that young people growing up in Cardiff have the opportunity to make a career in the creative industries. Who knows? The next Steve McQueen, Gurinder Chadha or Danny Boyle could be waiting right now. This Government are determined to unlock those opportunities for the next generation.
I thank the hon. Gentleman for raising the important issue of skills. We are focused on it because we have heard loud and clear from the creative industries that it is the brake on an industry that is otherwise growing much faster than other parts of the economy. As well as our work on the apprenticeship levy, to which he referred, we have already kick-started the curriculum review to put art, sport, music and creativity back at the heart of our classrooms, where they belong. We are about to launch a piece of work looking at arts across the whole country, to make sure we get our offer right in communities.
On the specific question about the apprenticeship levy, we are confident that we are making the right reforms, because we are working with industry—not just the big players in the industry for which the apprenticeship levy worked better, but the smaller organisations that need far more flexibility in the levy than is currently on offer. We are confident that the work that I, the Education Secretary and others are doing in conjunction with the industry is going to get that right.
When I visited Edinburgh over the summer, I met my counterpart in the Scottish Government. We are seeking a far more constructive and adult relationship with the Scottish Government than existed under the previous Government, and a far more direct relationship with the Scottish cultural sector. We are the UK Government, and Scottish culture is one of the richest exports and most incredible crown jewels in the whole UK cultural landscape. We are determined to have a far more systematic and sustained relationship with the sector there to support it.
As far as Rochdale is concerned, it is a fantastic location for filming, whether that is our magnificent town hall, our moorlands or Hollingworth lake, where the recent BBC TV series “The Jetty” was filmed. Rochdale Development Agency is currently exploring setting up a Rochdale film office. Does my right hon. Friend agree that this new tax break may well encourage that development?
The work that is happening in Rochdale is incredibly exciting. It shows that it need not just be our major cities that play a central part in our cultural life. Towns like his and mine and many of the towns and villages represented by Members from across our country, on all of our Benches, have made an incredible contribution to this country’s cultural life. We are absolutely determined that they will continue to do so.
I was very struck by the phrase “careful nurturing”, which my hon. Friend the Member for Camborne and Redruth (Perran Moon) used. I think he speaks for many Members on both sides of the House when we talk about the creative industries. The work that we are developing is exciting and vibrant, but it is also very fragile. We need to make sure that we work to carefully nurture it so that we can unlock its true potential, and this Government stand right behind him in helping to do that.
We have already started some of the necessary work. We have been talking to some of the big institutions that have a central role to play, and I have been struck by the great work that is going on, which we could extend. The Royal Shakespeare Company is visiting schools throughout the country, particularly in deprived areas or areas where there is a low cultural offer, to boost confidence and employability, open up young people’s options, and help them not just to have dreams—they all have dreams—but to have a plan to get there. That is the intention of our Government, and I would be delighted to work with my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams) to achieve it.
My hon. Friend was right to raise the subject of acting, but it is not just a question of acting; it is a question of the range of jobs that the creative industries support—jobs that a young person like me would never have dreamt of going into, because we simply would not have known about them. I want to ensure that we break that cycle, and that the next generation know there is no limit to what they can achieve with the help of this Labour Government.
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