Support for the creative economy

Written evidence submitted by Buckinghamshire Thames Valley LEP [SCE 057]

1.1 The Culture, Media and Sport Committee have launched an inquiry into s upport for the creative economy. The inquiry will examine whether and how government policy supports and strengthens the creative sector, whether it inhibits innovation in the sector, and how the success of the creative economy can be used to develop the UK as a global centre for investment and innovation in the creative industries.

1.2 Buckinghamshire Thames Valley LEP (BTVLEP) is the youngest LEP (Local Enterprise Partnership) in the country, having only been formally given approval by Business, Innovation and Skills (BIS) ten months ago (January 2012). BTVLEP has established a strong governance structure, with a highly focused, entrepreneurial outlook and the resounding support of local businesses.

1.3 Buckinghamshire is a county rich in creative enterprise, which today, continues to support a dynamic and evolving Creative Industries sector. From its historical association with television and film production, to the variety of creative media spin-off businesses and its clusters of visual arts enterprises, the sector epitomises the entrepreneurial culture for which Buckinghamshire is renowned.

1.4 As a result, Creative Industries contribute approximately 10% of the industrial base of the county, employing upwards of 10,000 employees (2010 DCMS Creative Industries Economic Estimates). The sector continues to be recognised for its national significance as well, with Creative Industries experiencing the fastest rates of economic growth between 1997 and 2008 (ONS Economic & Labour Market Review, Jan 2011). Within Buckinghamshire itself, major companies such as the Pinewood Studios Group, National Film and Television School and a wide variety of creative SMEs and micro-businesses ensure that the county continues to have international significance.

How best to develop the legacy from the Olympics and Paralympics of the display of UK talent in the creative industries in both Opening and Closing ceremonies and more generally in the design of the Games

1.5 Buckinghamshire was a host county for London 2012 and enjoyed many of the social, cultural and economic benefits of being closely involved in the o rganisation of the games. Collectively, the local partners involved in delivering Buckinghamshire’s input into the Games have identified seven key areas in which the county would wish to see a legacy generated from the games;

· Continuing to promote the uniqueness of t he Stoke Mandeville Brand

· Delivering a Permanent Sporting & Health Legacy

· Volunteering & Community Support

· Bucks as a Base for Major International Events & Stronger focus for Disability Sport

· Bucks the Accessible Destination for Visitors

· Stimulating the Assisted Living, Healthcare Technology and Creative Industry Sectors

· Continuing to Inspire & Educate a Generation

1.6 In light of the above, and the question about how best to develop the legacy from the display of UK talent involved in the design of the Games , we would see the major opportunities falling into the last two categories;

1.7 As far as realising the economic opportunities are concerned, we see some further value could be generated from using the experience acquired, partnerships established and contacts made in the Assisted Living, Healthcare Technology and Creative Industry Sectors to enhance the growth of these sectors and strengthen our Inward Investment proposition;

1.8 In addition, building on the enthusiasm and excitement generated in the opening and closing ceremonies, and more generally in the design of the games, we foresee some opportunities to work with our local education providers such as Bucks New University and Amersham and Wycombe College to strengthen and extend our technician and degree level provision

Barriers to growth in the creative industries-such as difficulties in accessing private finance-and the ways in which Government policy should address them. Whether lack of co-ordination between government departments inhibits this sector

1.9 I n-depth telephone research undertaken by Bucks Creative Enterprise (BCE) into support needs of the Creative Industry Sector in Buckinghamshire largely reinforced the findings of Ancer Spa’s Strategic F ramework and Action Plan for Developmen t of the Creative Industries in the South East England.

1.10 Collectively, these studies reinforced the idea that the main barriers to growth in the sector included;

· Reaching & finding customers

· Time limitations

· Access to finance

· Bureaucracy (particularly employment regulation)

· Managing Cash-flow

· Finding suitable workspace

· Lack of skills

· Establishing the business overseas

1.11 In light of these findings, BCE identified the needs of businesses in the Creative Industries as being :

· S hort courses on business skills, including specialised marketing , s ales, business planning etc .

· Specialist technical skills support, particularly around the latest industry technology developments

· Specialist business mentoring from practitioner s with good contacts & market-knowledge.

· R egular industry networking, particularly physical meetings

· Simplifying recruit ment practices - making it easier to find and recruit part-time and freelance workers to cope with peaks in demand

· Access to affordable workspace

· Support and advice on protecting IPR

· Supporting businesses with access to finance.

1.12 BTVLEP believes government should address these issues by :

· Continuing to encourage (and support) stronger collaboration between the private sector and the public sector on shaping educational provision, particularly at technician and degree level

· Encouraging UK Commission for Employment and Skills (UKCES) to develop and build upon employer-led skills mechanisms (like Graphics Interchange Format (GIF) and Educational Opportunity Program (EOP) ), so that they are more suited to the creative industry sector

· Encouraging the creation and development of industry-led specialist mentoring, networking, and advisory services

· Simplifying regulatory burdens associated with employing freelancers and part-time workers

· Supporting the expansion of specialist incubation facilities and applied research centres (particularly linked to nationally important research and development centres of excellence like Pinewood Studios, Buckinghamshire New University etc)

· Measuring the take up of mainstream finance solutions (like Regional Growth Fund , SMART Awards etc) by the creative industry sector and ensuring these funding mechanisms are sufficiently flexible for the needs of the sector, and developing more suitable solutions where they are not.

The impact on the creative industries of the independent Hargreaves Review of Intellectual Property and Growth, and the Government’s Response to it. The impact of the failure, as yet, to implement the Digital Economy Act, which was intended to strengthen copyright enforcement. The impact of proposals to change copyright law without recourse to primary legislation (under the Enterprise and Regulatory Reform Bill currently before Parliament)

1.13 BTVLEP welcomes the Hargreaves Review of Intellectual Property and the UK Government's response to it. We are pleased the government has largely accepted Hargreaves's main points, including the need for evidence before policy is formulated, or action is taken. However whilst we are encouraged that the government plans to address some of the most obvious absurdities of the digital IP system, we are concerned that the UK Government , Ian Hargreaves and his team have missed some obvious, much needed improvements to the current arrangements. For example BTVLEP remains concerned that t he current arrangements still unduly favour large corporate s , rather than smaller creative’ s ( many of whom simply can’t afford to pursue copyright infringements ) ; that the ‘orp h an works’ proposals will be open to abuse and will severely undermine the sectors ability to commercialise its IP; and that m etadata-stripping has still not been made unlawful .

1.14 As far as dela y s to the Digital Economy Act is concerned, BTVLEP recognises that the current digital copyright laws are suppressing the growth, contribution and export potential of the creative sector in the UK. However, we are also recogniz e the current impasse with (often foreign owned) ISPs is unlikely to be resolved quickly; and large sections of the current legislation appear un-implementable. To that end, we suggest government reviews its approach to online copyright protection and develops a more effective legislative framework that protects rights-holders but that also has the widespread support of the ISP community.

1.15 BTVLEP welcomes the strengthening of Copyright Law under the Enterprise and Regulatory Reform Bill .

The extent to which taxation supports the growth of the creative economy, including whether it would be desirable to extend the tax reliefs targeted at cer tain sectors in the 2012 Budget

1.16 BTVLEP believes strong evidence exists as to why tax incentives are important to the UK creative sector. For example, the film tax relief, which is worth about 12% to 20% of core expenditure (depending on the budget of the production and whether a payable credit is claimed) is estimated to have led to £1bn extra investment in British cinema.

1.17 BTVLEP would like to see the film tax relief restricted to only cover proper studio infrastructure and locations as opposed to ‘warehouses’ and other non-core film infrastructure . We believe enacting these changes will help build on the UK’s growing international reputation in film production, boost exports, provide more jobs and stimulate much needed growth to the U.K. economy

Ways to establish a strong skills base to support the creative economy, including the role of furth er and higher education in this

1.18 As stated in section 1.12, BTVLEP believes that the government needs to establish a strong skills base to support the UK economy, by;

· Continuing to encourage (and support) stronger collaboration between the private sector and the public sector on shaping educational provision, particularly at technician and degree level;

· Encouraging UKCES to develop and build upon employer-led skills mechanisms (like GIF and EOP), so that they are more suited to the creative industry sector;

The importance of "clusters" and "hubs" in facilitating innovation and growth in the creative sector. Whether there is too much focus on hubs at the expense of encouraging a greater geographical spread of companies through effect ive universal communication

1.20 BTVLEP is generally nervous of advocating a ‘clustering’ model. We remain unconvinced that Michael Porters theoretical model for developing ‘Business Clusters’ has transferred that well to implementation/public policy development in the last 10 years. The inability of regions within the UK to create new business clusters demonstrates how difficult it is for ‘cluster theory’ to be implemented in practice.

1.21 BTVLEP is much more supportive of a ‘hub’ based model, which needs to be supported by a favourable tax regime and skills environment. Our experience of working with Pinewood Studios demonstrates to us how important the combined issues of Infrastructure, Skills and a favourable taxation regime are to supporting important assets like Pinewood.

1.22 Given the above, we would urge the government to create the kind of national regulatory environment that enables the important creative industry ‘hubs’ in the UK to thrive and prosper. In an ideal world, these important assets need a national policy designation, which enables them to develop and respond to the global pressures and threats they face in such a way that supports the UK’s growth aspirations.

The work of the Creative Industries Council and other public bodies responsible for supporting the sector.

1.23 BTVLEP supports the work of the Creative Industries Council, and recognises that the strengthening of such mechanisms is a core recommendation of the Heseltine Review.

1.24 BTVLEP supports many of the recommendations in the Heseltine Review, but would also urge central government to find a way of getting the LEPs and Industry Councils to work together more effectively in the pursuit of growth .

November 2012

Prepared 17th November 2012