Support for the creative economy

Written evidence submitted by Equity [SCE 005]

1. Equity represents 36,500 performers and creative personnel working across the UK’s creative industries. Our members include actors, singers, dancers, variety artists, stage managers and stunt performers who work across various sectors including theatre, light entertainment, television, film, video games and the music industry.

2. Given recent challenges faced by the creative economy and the sector’s importance as a driver of growth, Equity welcomes this timely Inquiry. If called to provide oral evidence, Equity officials and members who appeared in the opening and closing ceremonies of the Olympic and Paralympic Games would be keen to elaborate on the experiences summarised in this submission and to discuss other areas covered in the call for evidence issued by the Committee.

Legacy of the Olympics, Paralympics & Cultural Olympiad

3. Equity was involved in several aspects of creative programme of the Olympics and Paralympics and was in regular contact with organisers in the lead up to, and during the Cultural Olympiad. The experience of representing and negotiating on behalf of performers taking part in the cultural aspects of these events was both positive and negative.

4. The high quality of talent on display at the ceremonies, from dancers to stunt performers, clearly demonstrated the logic of engaging the best of the UK’s professional performers, however the fact remains that the bulk of performers who took part, a further 10,000 people, were working for free, on a ‘voluntary’ basis.

5. Across the four opening and closing ceremonies around 800 paid performers and stage managers were engaged. This represents the largest group of paid artists ever engaged for the Olympic and Paralympic ceremonies. Agreeing the contracting process for the 800 paid performers was, however, a long and complicated process. At the first formal meeting to discuss the matter in October 2011, LOCOG insisted that the performers and stage managers were to be engaged as independent contractors, paid on a fee-only basis.

6. Following protracted talks with Equity officials over a period of some months, LOCOG’s lawyers conceded that the performers were indeed workers and that National Insurance payments were due. The Equity "supported" agreement that was finally concluded in early 2012 secured basic rights around breaks, working time and a weekly payment of £600 for the contracted performers. Equity also arranged to have a permanent base at the Olympic Park in order to provide advice and support for performers during the rehearsal period in the lead up to the ceremonies.

7. The Cultural Olympiad presented fewer problems for performers, as the individuals and organisations involved in developing the programme had a better understanding and experience of how the sector works. That said, due to funding pressures, in reality much of the Cultural Olympiad was curated work, produced by partner organisations such as the Globe, which adhere to standard industry terms and conditions for performers. The extent of new work and in turn, new employment opportunities for performers and other creative workers is as yet unknown, but may become clearer in the evaluation process being conducted by the University of Liverpool.

8. In answering the key question posed by the Committee, namely what can be done to develop a legacy for the Games in terms of UK creative talent, Equity strongly believes that the status of performers as legitimate workers must be recognised. This was a running theme throughout the cultural programme of the Olympics and Paralympics and is indicative of a wider trend towards an expectation that performers will provide their services for free, even when working alongside other paid creative workers and support staff.

9. Clearly it is important for the creative economy to preserve a degree of flexibility with respect to the mobility of its workforce and the short-term nature of engagements. That is something that is expected and understood by performers and creators, many of whom value their own flexibility to work for different employers on projects that are temporary by their very nature. Nevertheless, the flexibility to engage workers on short-term projects, combined with incorrect perceptions about the industry, should not undermine the ability of performers, 85% of whom earn less than £20k per year from their work in the creative economy, to build sustainable careers.

10. Beyond the one-off events that took place in 2012, there is further evidence of the increasing vulnerability of workers in the creative economy. Alongside other members of the Federation of Entertainment Unions, Equity has been working to ensure that employers, and in particular, arts organisations and education establishments recognise their obligations under the National Minimum Wage Act.

11. Film schools have been a particular problem for the union. They often seek to rely upon section 44 of the National Minimum Wage Act to provide for non-payment of the NMW in return for work on student films, due to the fact that film schools are registered charities. Equity does not believe that this is the intention of the Act and has been encouraging film schools in particular to use the union’s own model agreement for student films.

12. Following Equity’s interventions, and support from Arts Council England, a number of employers have reversed their proposals to offer unpaid work. However this approach has a limited impact due to the fact that it is reactive. Year on year Equity members and officials are reporting that there has been an increase in the level of unpaid and low paid work being advertised in the entertainment industry under the guise of the voluntary worker arrangements, despite the fact that the union has successfully challenged a number of employers.

Funding & Finance

13. The factors which will sustain the UK’s competitive advantage in the creative industries are those which will enable creative organisations and businesses to continue to produce the best content in order to meet demand at home and abroad. The key interventions which will promote conditions for success are: sustainable funding for the arts, investment in public service broadcasting, a strategy for the film and video games industries, a fully functioning intellectual property regime and support for the grassroots of the creative industries including live entertainment.

14. The availability of a highly skilled and innovative workforce is clearly a core component of the current and future health of the UK’s creative economy. In 2010 nearly 9% of the UK’s businesses were found to be in the creative industries (a substantial proportion of which are SMEs) and 2.3m UK workers were employed in the creative economy. A number of issues must be considered if the creative industries are to provide sustainable and rewarding employment as well as deliver economic benefits.

15. Any significant cuts to public funding for the arts inevitably places the sustainability of many organisations at risk. This will impact on the employment, training and development opportunities available to actors, performers and creative professionals, whose contribution to the arts drives the success of the UK’s cultural offer nationally and locally. While national level cuts have been well documented, the pressures faced by local funders, and in particular local authorities, are much less well known.

16. The Local Government association predicts that by 2019/20 local authorities will have a funding gap of £16.5bn-a 29% gap between funding and spending commitments. With this background, it is expected that discretionary areas of spending, including arts and culture will be hit hard and in many areas disappear completely. The Cultural and Leisure Officers Association estimate that local authority budgets for arts and culture have already been cut by 15% in 2012/13.

17. Equity has spoken out against these cuts and has engaged with leading employers in our sector, the Arts Councils, and our audiences to stress the economic and social importance of the arts. Our chief concern is that without investment in regional and local arts and culture we stand to lose the pathways for future creative talent, particularly talented individuals from underrepresented groups. It also increasingly apparent to artists and arts organisations that private giving and philanthropy will be able to plug the funding gap.

18. It has been a source of great disappointment that successive Coalition Secretaries of State for Culture, Media and Sport have neglected to meet with representatives of those working in the sector, despite several invitations. Junior Ministers in DCMS have however have engaged positively on issues including copyright and licensing reform. On the latter issue, the passage of the Live Music Act and the willingness of the Department to explore radical proposals to enable entertainment venues and artists not just to weather the recession, but grow and expand, has demonstrated what can be done when Government works with unions and other stakeholders.

19. Further reform of licensing law is necessary to assist those beyond the live music sector, particularly street performers, Punch & Judy shows, circuses and other forms of live entertainment and this is one area where coordination between Government Departments can slow delivery of policy objectives.

IP/Copyright

20. Equity is a member of the British Copyright Council and Equity’s General Secretary is Chair of the Creative Coalition Campaign. As such, we endorse the points made about implementation of the Digital Economy Act, the Hargreaves Review of Intellectual Property and the Enterprise and Regulatory Reform Bill in each of these organisation’s submissions.

21. Equity supports the need for a balanced set of copyright rules to ensure there are sufficient incentives and rewards for creators and artists as well as ensuring access to creative content for consumers at a reasonable cost. The intellectual property framework that currently exists in the UK is largely successful in achieving this.

22. The rights that exist for audiovisual performers in the UK are limited, and have mainly been achieved through the inclusion of rights under contract, negotiated on their behalf by Equity. These mechanisms are designed to ensure that an artist benefits from the success and continued exploitation of their performance. Combining various ongoing payments enables performers who have itinerant and unpredictable working patterns to build sustainable careers. Low pay is endemic in the entertainment industry and without additional payments the diversity and breadth of talent in the UK creative sector could be lost. For this reason, two key areas of reform, recommended by the Hargreaves Review, are of particular concern to performers.

23. Equity is strongly opposed to a format shifting exception being introduced into UK law without fair compensation for rights owners. The most effective compensation mechanism of which we are aware is a system based on private copying levies, as operates in most other European countries, or a licence based upon similar principles.

24. There is also a lack of economic evidence to support a new exception for parody. Parody is already widespread and part of the existing tradition of free speech in the UK. The introduction of such an exception could also have unintended negative consequences for performers and would not be in interests of the UK creative economy, particularly given there is no proposal to strengthen moral rights for performers as part of this change.

Tax reliefs

25. Equity supports the introduction of new creative tax reliefs and hopes that projects which have moved abroad will now consider returning to the UK. Assistance from tax reliefs may also mean that previously unviable productions will now be made, creating jobs for performers and other creative workers.

26. Equity does however have some concerns that the definition of ‘high end television’ as envisaged by the Treasury will not necessarily apply to children’s drama and other important and marketable productions. For example, under the tariffs system which governs BBC spending on programmes, budgets for commissioned productions differ by BBC Channel and consequently some genres may miss out on the new incentives. Tariffs for prime time drama output on BBC1 such as Great Expectations, shown in 2011, are set at £1m+ per hour, whereas on CBeebies tariffs are set closer to £40k per hour for children’s drama programmes such as the popular Tracey Beaker series. There are similar differences between the tariffs that apply to BBC 1 and BBC4/BBC3 drama and comedy productions.

27. Drama and comedy production for children has declined substantially over the last decade, despite the recognition of the importance of this genre by Government. If the new tax relief for high end television is an unsuitable means of supporting the sector, the Treasury may wish to consider how producers of children’s drama and comedy content could access alternative assistance.

28. As with the film tax relief regime, new tax breaks for high end television must also go hand in hand with the promotion and use of standard industry contracts for those engaged on productions. Actors, stunt performers and other creative workers must, as far as possible, be remunerated in line with existing industry standards and union agreed rates of pay will be if the industry wishes to maintain sufficient depth and breadth of expertise to meet the demands of British and international producers.

29. Recent experience Equity has had of productions being made outside of the UK demonstrates that there has been, to some extent, a race to the bottom in terms of contracts being offered to performers. Earlier this year the BBC commissioned UK-based independent production companies to produce three large-budget programmes in the Irish Republic for transmission in the UK: Loving Miss Hatto, Vexed and Ripper Street.

30. Equity had two concerns about these productions. The first was that the independent production company concerned had announced that it would not use the standard Equity contract agreed with PACT, which is designed specifically to meet the needs of independent productions. The second concern was that the productions were being made outside of the UK and in particular were not being filmed in Northern Ireland despite the BBC’s commitment to increasing production in the UK’s Nations to 17% over the next four years.

31. In terms of the video games industry, Equity members work in development studios in a number of roles including directing, voiceover and motion capture. Performance capture is a relatively new field for actors, involving the digital capture of an actor’s movements to aid game animators in creating realistic characters. As video games become more and more sophisticated, the use of actors to enhance the in-game experience has evolved and expanded.

32. The video games industry does not have levels of coverage by collective bargaining or codes of conduct governing working practices and terms and conditions comparable with other areas of the media and entertainment industries. It is hoped that tax reliefs will enable the video games industry in the UK to create jobs. Government must press upon the videogames industry the need to engage with trade unions organising and representing workers in the sector, to ensure that skills and talent are retained and that the highest possible employment standards are adhered to across the media and entertainment industries.

Skills & Training

33. Training and development opportunities for young people entering the creative sector are already under threat due to higher education funding cuts and higher levels of tuition fees. There are also difficulties in retaining the skills and experience our members have studied for at university, drama school, film schools and conservatoires as arts cuts affect the number of work based learning opportunities arts organisations can provide.

34. Recognising the need for extra support, Equity, Skillset and the Union Learning Fund have worked in partnership to recruit freelance careers and learning advisors to deliver guidance to performers. However, these measures are not sufficient to provide the full range of training and development required, particularly by the audiovisual industry. The sector itself should play a greater role in addressing skills needs. A more concerted effort to address the need for specialist training in screen acting would be particularly welcome.

35. The entertainment industry is characterised by informal recruitment practices and this often requires new entrants to undertake unpaid work in order to develop a portfolio and contact networks. For many, particularly those coming from non- traditional backgrounds, this is only possible if access to JSA and associated benefits is available during this formative phase of a performer’s career.

36. While there are elements of the new welfare system which will allow recipients to benefit from doing small amounts of irregular work, Equity has alerted DWP that under the new arrangements for JSA and Universal Credit it does appear that our members would become subject to greater conditionality and to a sanctions regime which is designed for workers in non-itinerant occupations.

37. Equity provides specialist tax and benefits advice to its members. Our advisors have noted an increase in calls and enquiries from distressed members concerning the misapplication of the new sanctions regime. New guidance for personal advisors in Jobcentres and working on the Work Programme on issues such as the dual status of performers under the tax and National Insurance regimes is urgently needed, as well as training on how to exercise discretionary powers in a manner appropriate to the working patterns and practices of the entertainment industry.

Hubs

38. Equity’s concerns about the ‘hub’ approach mainly relate to the spread of employment opportunities in the audiovisual industries. Currently employment in film and television production is heavily concentrated in London and the South East. Performers in the UK’s nations and regions often struggle to find enough employment to sustain a career in the entertainment industry and many are forced to relocate to London in order to access opportunities.

39. During the consultation conducted by Creative England in 2011 Equity raised concerns about the proposed ‘hub’ model, which we feared may result in resources shifting towards the West of England. While we acknowledged that Creative England’s ‘hub and spoke’ model was intended to provide outreach to centres beyond Bristol, Birmingham and Manchester, we were nonetheless concerned that important creative centres, where many Equity members live, such as Newcastle, Yorkshire and East Anglia may lose out.

40. At the start of 2012 Equity launched the 'Broadcasting in the Nations' campaign to increase the number of programmes made in Wales, Scotland and Northern Ireland. According to Ofcom, 61.8% of spending by public service broadcasting channels in 2010 went to productions made within the M25. Productions in Scotland received 4.6% of spending, Wales 2.6% and Northern Ireland 0.4%.

41. While there some examples of good practice such as Game of Thrones and Da Vinci’s Demons, filmed in Northern Ireland and Wales respectively on Equity contracts, in most cases when shows are made in the nations, there are few - if any - opportunities for performers in the nations to appear in them.

October 2012

Prepared 17th November 2012