SUBMISSION 17
Memorandum submitted by BECTU
1. BECTU welcomes the Committee's inquiry
into the British film industry, particularly at a time when the
Film Council report on "Building a Sustainable UK Film
Industry" has stimulated widespread debate. As a media
trade union with 27,000 members, up to 10,000 of whom may work
at some point in the film industry as freelances, we have a close
interest in the debate—which is the first concerted examination
of the industry since the Government's Film Policy Review, leading
to the report "A Bigger Picture" in 1998.
2. Our submission will be short and to the
point. We focus on the measures we believe are essential to maintain
and improve our film production and distribution sectors. We recognise
that as an industry we act both as a provider of services and
a production base for large budget Hollywood productions using
UK facilities and labour; and also as a producer of indigenous
UK films, usually with medium to low budgets. We wish both aspects
of our industry to flourish but we believe decisive policy measures
are necessary to ensure this—especially at a time of the
increasingly internationalisation of the industry (with an ever
growing number of countries offering film-making facilities) and
of the particular recent problems in the wake of 11 September
and other specific difficulties.
PRODUCTION
3. We welcome the Government's introduction
of tax relief in the form of the 100% first year write-off under
Section 48; and we applaud its extension to 2005. We further recognise
the value of Section 42 tax relief.
4. We believe continuing fiscal support
for production is a necessary but not sufficient policy measure
to sustain our film industry. Very many governments around the
world now offer support mechanisms to attract and encourage film
production. To retain our place against the increasingly intense
global competition, we must continue to do the same. We therefore
commend the extension of tax relief measures beyond 2005.
5. We recognise that a key element in production-support
mechanisms is the notion of the EU/British "qualifying film"
as a condition of eligibility. We are strongly in favour of retaining
the labour-content provisions as part of the definition of a qualifying
film. In a labour-intensive industry with a high premium on creative
and technical skills, our labour and skills base is perhaps the
key defining asset of our industry. Our support mechanisms should
continue to recognise this.
INDUSTRIAL RELATIONS
6. A key component of such a labour intensive
industry is industrial relations and labour practices. This has
been recognised in the debate initiated by the Film Council through
the publication of the Relph Report focusing on low budget production.
We welcome this debate as an opportunity to express some of our
own concerns in this area, and I attach, for information, BECTU's
initial response (Annex A).
DISTRIBUTION
7. The key theme in "A Bigger Picture",
reinforced in the recent Film Council Report, is that we need
to encourage the emergence of a distribution-led industry. We
agree with the thrust of this analysis.
8. We face a continuing structural problem
of a fragmented, production-led industry seeking to compete in
a world market dominated by the distribution-led, integrated US
film industry. The distribution process is overwhelmingly led
by the US majors, with a strong interest in the production and
marketing of Hollywood productions. The results are well documented.
US films predominate in British cinemas and many British productions
fail to achieve distribution even in the UK. Distributors, with
a spread of risks and great control of rights simply do not face
the crippling financial uncertainties that bedevil our indigenous,
production-led industry.
9. We would therefore support measures to
encourage the development of UK-oriented distributors. In particular,
we would support tax breaks for distributors conditional on the
distribution and marketing of British films and possibly on a
requirement for re-investment in UK production.
OTHER MEASURES
10. We advocate detailed consideration of
mechanisms to recycle a proportion of box office revenue into
UK production. In the past, of course, we have had the Eady Levy,
which in its day was a very successful film support mechanism.
We should note that currently the UK and Denmark, are the only
EU member states to levy VAT at the full rate on cinema tickets.
It may be that the German model of reduced VAT together with a
recycling of some of the extra exhibitors' revenue into production
is applicable in the UK.
11. We note with disappointment that the
current Communications Bill contains no encouragement for broadcasters
to work more closely with the film industry. The recycling of
a proportion of broadcasting revenue into domestic film production
is an established mechanism in France, Spain and Germany. Given
UK broadcasters' significant use of feature films to generate
audiences and thereby revenue, we believe similar measures should
now be given consideration here.
12. We note the gradual emergence of "e-cinema"
or "d-cinema" ie the digital distribution and exhibition
of films. We recognise that this may have medium to long-term
implications for the cinema exhibition sector (in terms of staffing)
and even more so for the film processing laboratories (which may
eventually have to shift from a focus on bulk prints to becoming
digital laboratories). This has major retraining implications
for our laboratories—especially those larger companies such
as Deluxe and Technicolor engaged in bulk print work for UK and
foreign cinemas. We therefore urge a well planned transition,
with appropriate emphasise on retraining, for this essential but
sometimes forgotten element of our film industry.
13. On rights, we urge greater attention
to the position of individual creators, as opposed to the corporate
control of intellectual property. Individual writers, directors,
designers and animators routinely face contracts which compel
them to assign all rights upfront. We believe a more measured
and conditional licencing of rights for specific and time-limited
uses is a fairer approach. The industry should seek to foster
rather than exploit the creative talent on which it rests.
14. We recognise the Film Council as a strategic
lead body for the industry. While not necessarily agreeing with
or supporting all of its policies or activities, we nonetheless
support the continuation of this body, which provides a useful
funding and policy focus for the sector—as evidenced in
the recent debate initiated by the Council.
TRAINING
15. We recognise the key role of training
in our labour intensive industry—especially in a context
in which our skills base is one of our main advantages when facing
global competition for work. We therefore commend the work undertaken
so far by Skillset, the industry's Sector Skills Council. We furthermore
support the joint Skillset/Films Council "Film Skills
Research Project", with its aim of developing a specific
skills and training strategy for our film industry.
16. Training is necessary but expensive.
It is especially difficult to provide in a fragmented sector with
an overwhelmingly casualised labour force. We recognise the financial
support provided on a voluntary basis through the Skills Investment
Fund. We believe, that this needs supplementing by inserting a
requirement to contribute to public training funds as a condition
of benefiting from future tax breaks. If necessary, however, we
advocate a compulsory training levy on all production companies.
CONCLUSION
17. We welcome the current strategic debate
on the film industry and believe the policy measures set out above
could contribute significantly to improving the industry's prospects.
We look forward to the Committee's examination of these issues.
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