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Film Industry

Motion made, and Question proposed, That this House do now adjourn.-- [Mr. Andrew Mitchell.]

12.2 am

Mr. James Clappison (Hertsmere) : I welcome the oportunity to speak. This is a timely debate--not least in view of the Oscar awards ceremony earlier today, but also in the context of the British film industry itself. I hope tonight to take some of the spotlight away from that ceremony in Hollywood, and to shine it on our own film industry--an industry which is failing to live up to its rich tradition and great potential. That was mentioned by Britain's one Oscar winner, Nick Park, the animator who so deserved his success. There is currently great interest in the regeneration of our film industry. I know that my hon. Friend the Minister and our right hon. Friend the Secretary of State for National Heritage share that interest, and are committed to a positive outlook and the realisation of the industry's full potential.

My hon. Friend will know of the wider interest--throughout the industry--in its regeneration ; that was marked last week by the launch of the motion picture, arts, commerce and technology initiative, supported by 300 leading figures throughout the film industry, including many directors and artists of the calibre of Kenneth Branagh, Michael Caine and Sir Anthony Hopkins. The initiative deserves to be considered in detail, and one of my purposes in raising this issue tonight is to invite my hon. Friend the Minister to give it the necessary consideration in order to ascertain what needs to be done to restore the British film industry to its place among the best in the world.

In talking of the best in the world, one thinks of Mr. Steven Spielberg, whose success at the Oscar ceremony was so richly deserved and which will have given so much pleasure to so many different people for many different reasons.

Among those who derive pleasure from his success are many people in my constituency of Hertsmere, which has a very strong connection with Steven Spielberg through the studios at Elstree and Borehamwood, where he has made many pictures in the past and which he holds in high regard. He has said that he would like to make films there again, and everyone in Elstree would be pleased to welcome him back but, sadly, as Steven Spielberg is sweeping all before him at the Oscars, Elstree studios faces an uncertain future and is struggling to survive.

In a sense, the fate of the Elstree studios symbolises the decline of British film making. In its own way, it has been at the forefront of film making since the beginning of the century. In the early years of this century, Elstree earned a reputation as Britain's own Hollywood. The first talking picture made in this country was made there by Alfred Hitchcock. Elstree went on to produce a stream of famous British films such as "The Dambusters" and "Moby Dick". It later came to be a centre for American film production and, in the previous decade, was the production site for many Hollywood blockbusters, including films of the calibre and importance of "Who Framed Roger Rabbit ?", "Star Wars" and the Indiana Jones trilogy. It is sad to report that, from those heady times and that level of activity, Elstree studios has declined.

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In 1988, Elstree was purchased by Brent Walker. In 1990, the company obtained planning permission for redevelopment of the studio site, which was to include the sale of part of the site for retail purposes. That has subsequently taken place, but on condition that the remainder of the site be used for purposes related to film and television production for 25 years. That agreement also incorporated a performance bond, in the sum of £10 million, and an acceptance by Brent Walker that it would carry out a phased development of the retail aspect alongside redevelopment of the film studios. The agreement was entered into with Hertsmere borough council, but, unfortunately, although the retail development has come to pass, the development of the film studios has not. In July last year, Brent Walker issued eviction notices to the remaining tenants of the studios, who had been left in a serious plight. In September, the closure of the studios was announced. With all- party support, Hertsmere borough council has responded by launching legal action. I do not propose to go into the merits of that action, but there is great determination in my constituency to save the studios. That determination extends to Hertsmere borough council, where there is all- party support for saving the studios, and to Borehamwood town council, which is very proud of its film-making heritage. There is also wide public support in the constituency under the "Save our Studios" campaign. The campaign is supported throughout the British film industry, and has attracted the support of many of its leading figures.

The point of my raising the subject of Elstree studios is that, whatever its future in film making and television production, it is linked to the overall health of the British film industry. In the same way in which the decline of Elstree perhaps mirrors the decline of the British film industry, I hope that its regeneration could be matched by a regeneration of our film industry.

From any viewpoint, we must accept that British film making is not living up to its full potential. Investment has declined. In comparison with our European neighbours, we are investing less and producing fewer films. In France, investment in films is increasing, whereas in Britain it is decreasing.

What is more, it seems that we are losing some of the big commercial productions and that, more and more, those British films which are produced are relatively low-budget--many of which could be described more as artistic than commercial. That is not to decry them. Of course, some low- budget films are very good. However, for a successful and healthy film industry, we must produce big-budget British films and also, importantly, we must attract to Britain producers from overseas, especially from America, to use our film infrastructure.

The decline has taken place notwithstanding the great potential, to which I call the attention of the House. There are some outstanding advantages to the potential development of the British film industry. We have a richness of artistic and technical talent. Many of those talented people are having to seek work overseas, including not only directors and artists, but technicians.

Production companies have gone overseas wholesale and found work in Hollywood, yet we have that richness of heritage in Britain. We also have the great advantage of being the only English-speaking member of the European Union. We have a growing cinema market. Cinema admissions have almost doubled since the beginning of the 1980s, and in the past year we saw a further healthy

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increase, to 112 million admissions. Over the past decade, we have seen the explosion of the home video market and all the implications that that has for film making. We also have access to the European market and its huge potential for audio-visual productions. Britain has those huge advantages, and it is up to us as a nation to realise the full potential of our industry. I know that my right hon. Friend the Secretary of State and my hon. Friend the Minister are keenly aware of the need to develop that potential. In 1990, there was the famous meeting between Baroness Thatcher and representatives of the film industry, which was followed in 1992 by some help towards the film industry's budget.

Since then, my right hon. Friend and my hon. Friend have sought to take a positive attitude from any angle towards the film industry. The Department of National Heritage has been widely welcomed throughout the film industry as a positive step forward in itself. My right hon. Friend has also piloted the National Lottery etc. Bill through the House, which will provide assistance to the film industry through the proceeds of the national lottery, and is also to be welcomed.

Mr. Bob Cryer (Bradford, South) : That has not yet been decided.

Mr. Clappison : It will be filtered through the Arts Council. I think that clause 24 of that Bill obliges the Arts Council to direct some money from the lottery to the film industry. The hon. Member for Bradford, South has commented on that.

That money is welcome, but when the Bill went through the House, it was accepted that it was not a substitution for core funding. I ask hon. Members to take a much more radical approach. My right hon. Friend and my hon. Friend are presently engaged in consultations with the film industry, which it has welcomed. The consultations have been extensive, and have considered many points of view.

However, I invite my hon. Friend and my right hon. Friend, in the course of those consultations, to consider carefully the initiative put forward in the past week and the strong arguments in its support. There is a powerful and compelling case to consider the fiscal environment for film making, and to compare and contrast it with that of many other countries in the need to encourage investment in film production. Surely there must be a case for encouraging investment by those who benefit from film production. I include in that definition distributors and exhibitors of films, the video film industry, and possibly some branches of the television industry.

I also invite the Minister to examine the case for reconsidering the tax treatment of visiting artists--the withholding tax, which has been described by many people in the industry as a factor which influences the location of productions. I hope that my hon. Friend will also consider the way in which expenses are written off. I know that the Government have considered that subject in the past, but I invite them to do so again, and to consider an initiative. Today, in view of its famous past, Elstree studios, in my constituency, is in some ways rather a sad place. A great deal of hope and commitment are still attached to the place, and local people regard it fondly. In a way, it stands as a reminder of what failure can mean, and what it has meant in the recent past. But the studios are also a symbol of

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hope. I hope that they can have a future as part of a reviving British film industry, and be involved in both film and television productions.

Those may not be on the scale of some of the glories of the past, but the fact that there can be a future for Elstree has been confirmed by studies carried out by Hertsmere council. I hope that my hon. Friend will keep well in mind the need to revive not only Elstree but the film industry throughout the country, which has the potential to be a most important industry and to do an enormous amount of good.

Mr. Cryer : I thank the hon. Gentleman for giving way to me. This is his Adjournment debate, and I congratulate him on having secured it. I entirely agree with most, although not all, of what he has said, and I share his hope that Elstree can become a revived film studio, at a time when the British studios that are still operating have their space fully booked and are doing well. It would be helpful if Elstree could share in that resurgence of the British film industry.

Mr. Clappison : It may not come as a surprise to the hon. Gentleman to hear that increasing use has been part of the debate on the future of the studios. That point has certainly been made.

In conclusion, I invite the Minister to adopt a radical approach, to build on the positive outlook that I believe the Government already have towards the film industry, and to be prepared to take the radical steps needed to revive that important industry. 12.17 am

The Parliamentary Under-Secretary of State for National Heritage (Mr. Iain Sproat) : I congratulate my hon. Friend the Member for Hertsmere (Mr. Clappison) on his good fortune in having secured the debate on this important industry, and on his cogent and persuasive speech--delivered without notes, which is always impressive. The film industry in this country has a long and illustrious tradition and attracts many able and talented people--people who are talented both artistically and commercially. My hon. Friend has referred to the impressive role played by Elstree studios in the long career of the British film industry. His constituents could have no more persistent or hard-working Member of Parliament on the issue ; he has raised the subject many times with me in letters, as well as on the Floor of the House.

The Government have received representations inviting us to prevent the closure or change of use of Elstree studios. Although we recognise that Elstree has made an enormous contribution to British film production in the past, the future use of the studios is a matter for the commercial judgment of the owners, subject to any necessary planning consents.

It is not for Government to intervene in the commercial decisions of companies, and we have no plans to do so. Nor is it the role of Government to decide whether particular studios or other businesses should remain in operation. Rather, it is the role of Government to establish an overall framework within which the industry can thrive, and to offer limited financial support to encourage the development of an appropriate infrastructure for the industry.

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It is for members of the film industry to provide the ideas, creative talents and entrepreneurial skills needed to make the industry flourish. In short, the Government believe that the film industry, like other industries, will prosper only if it can stand on its own feet without relying on subsidy.

It may be helpful if I describe briefly the various support measures that the Government provide to the industry at present. In the first place, we think that it is right to support training in the industry by contributing £1.85 million annually to the national film and television school. That is less than 50 per cent. of the school's total budget, the remainder being met by the industry. Over time, we expect the industry to take on an increasing proportion of the school's running costs.

Graduates of the school are prepared for careers in the film and television industries. Training courses cover a large range of disciplines, including production, direction, animation and camera work. Graduates of the school have regularly been awarded prestigious industry awards. Government support for the school is intended to ensure that British talent continues to be in demand wherever excellence is required.

Film, of course, is a cultural, as well as a commercial, activity, and we make a substantial grant--£15 million this year rising to £17 million in 1994-95--to the British Film Institute. The institute is responsible for encouraging the understanding and development of moving- image culture in all its forms, covering film, television and video. Among its many functions, it operates a world-class library, the Museum of the Moving Image and the national film and television archive ; and it is responsible for the screening at the national film theatre of many films to which the public would otherwise have little or no access.

Looking to the future, a new source of funding for the non-commercial aspects of film will be, as my hon. Friend recognises, the national lottery. Part of the share of lottery proceeds earmarked for the arts will be available for film, but the projects supported must be primarily of benefit to the public, not for private gain. While the Government have recognised the need to support the cultural aspects of film, we are also aware of the need to encourage particular aspects of the industry. In that context, I draw the attention of my hon. Friend to the achievements of British Screen Finance Ltd., the private sector company which the Government have funded since 1986 with an annual grant of £2 million.

In December 1992, my right hon. Friend the Secretary of State for National Heritage announced that funding will continue until at least March 1996. British Screen Finance operates three support schemes by loaning money on a commercial basis. Those schemes provide support for low to medium budget productions, short films and script development. Many of those films reflect the British culture and way of life.

An important part of British Screen Finance's remit is to enable new talent to enter the industry, encouraging the development of fresh entrepreneurial and creative talent which would otherwise find it difficult to make a start in film production. Since 1986, British Screen Finance has invested in 85 feature films, most of which would not have been made without Government support.

British Screen Finance is also responsible for administering the European co-production fund. The fund was set up in 1991 with Government support of £5 million

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over three years, with the objective of promoting collaboration between producers in the United Kingdom and other European countries.

The fund has supported 11 co-productions to date : seven made with other European Union countries, and four with non-member states. Again, many of them would not have been made without Government support. During 1993, the fund was the subject of an independent evaluation review. Following that review, we announced last December that funding will continue for a further three years.

Continuing with the European theme, I remind the House that, in April 1993, the Government arranged the United Kingdom's accession to "Eurimages", a Council of Europe initiative aimed at developing the European audiovisual industry. "Eurimages" provides financial support for feature-length fiction films, creative documentaries and distribution.

The scheme is proving to be very successful, with approval having already been given to 11 productions involving British participation. The Government also provide financial support for the secretariat of Audio- Visual Eureka, a body with a membership of 33 European countries, which provides help in a variety of ways to audiovisual industry professionals who seek to operate on a European level. An important task of the body has been to establish a European audiovisual observatory, with the purpose of collecting, disseminating and standardising European audiovisual data for the industry. Again, the Government are contributing towards its running costs.

In addition, the Government are contributing £28 million to the five- year MEDIA programme established in 1991. This European Union programme runs 19 projects mainly targeted at developing opportunities for small businesses, offering support for a range of activities relating to the development, marketing and distribution of film, television and video products, and including cinema exhibition, training and new technologies.

I turn now to the world stage. The Government recognise the need to make the United Kingdom an attractive place for foreign film makers. That is why the British Film Commission was set up in 1991, with Government funding of £3.5 million over four years. The objective of the commission is to promote the United Kingdom as a location for the filming of feature firms, television programmes and commercials. In carrying out that activity, the British Film Commission promotes British personnel and facilities in the film industry and helps to stimulate the development of the technical support structure. In 1992, the film industry earned £182 million from overseas companies which came to the UK to make films. This year, we are already aware of at least four United States films that will be made here.

We should not ignore the export earnings of British films which are screened overseas. Last year, the export earnings of the British film industry were considerable, and £189 million was earned through royalties from the overseas exhibition of British films in foreign cinemas and on foreign television.

It is because of both the cultural and the economic importance of the film industry that my right hon. Friend the Secretary of State has recently been reviewing the state of the industry. There is much good news. Last year, there were 67 UK-produced films, with £214 million of investment--a significant increase on the previous year.

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Foreign producers continue to invest in the United Kingdom, benefiting from the superb talent and facilities which are available.

The number of cinema screens in the UK increased by almost 400 between 1989 and 1992, with the number of admissions more than doubling over the past decade. Films continue to be one of the most popular forms of entertainment available on television and video. I am sure that my hon. Friend will agree that there are encouraging signs for the film industry.

However, the Government are not complacent about the British film industry, and, well before the launch of the industry's campaign "Impact"--which my hon. Friend mentioned--we were aware that many members of the

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industry were concerned at the levels of investment. That is why my right hon. Friend the Secretary of State held a round of consultations with all sectors of the film industry to listen to the views of the people who work in the industry.

My right hon. Friend has listened closely and sympathetically to all the proposals put before him during his meetings, and to all the representations that have been made subsequently. He is currently considering what might be done to increase the level of private investment in British film production, and he will make an announcement on his conclusions in due course.

I am sure that my hon. Friend will join me in wishing the British film industry every success in the future.

Question put and agreed to.

Adjourned accordingly at twenty-seven minutes past Twelve midnight.

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