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10.22 am
Mr. Anthony Coombs (Wyre Forest): I want to support a generally well-received report and pay tribute to the excellent and well-informed chairmanship of the right hon. Member for Manchester, Gorton (Mr. Kaufman). It was the Committee's basic intention that the report should bring about steps to improve the British film industry. To be fair, it does that against a promising backdrop in terms of the market for film in Britain. We have heard about the massive increase in cinema audiences and the huge improvement in facilities for exhibition, especially the increase in multiplexes. I shall be looking for the development of Kidderminster town centre to include a multiplex cinema.
We also heard of the increase in the number of British produced films, at least when compared with the low levels of the past 10 years, and the increase, to £176 million, in expenditure on films made in this country by British and foreign producers. That is small compared with what it could be, but it is evidence of a buoyant market. The best evidence of that is the expenditure in the UK on film over the past 12 years, which, according to the Department of National Heritage, has increased by some 500 per cent. in real terms. That is a buoyant market in which the British film industry should be specifically involved.
One problem with the industry is that it is difficult to define a British film. Does it involve a film being produced in Britain, the genesis of the idea or the people involved? Secondly, the film industry is, by definition, footloose. I have reservations about the consistency of the position of people in the film industry who bemoan the fact that they cannot make films in Britain but who, as soon as an opportunity presents itself, zoom off to Hollywood. They take large salaries and sit there thinking of nice warm beer and sandwiches back in good old blighty.
Thirdly, the British film industry is heavily fragmented compared with the American monoliths. As a result, there is no continuity of supply. We noticed that only seven of 49 British films last year had a budget of more than £6 million, while the average for the US product made in Britain was £22 million. More than that, the mortality rate of feature film production companies in Britain is very high.
Three issues must be addressed in acting on the report. First, there is the vertical integration of production, distribution and exhibition, and the huge power of the US and Japanese conglomerates. In what is, in essence, an international market, we have only 7.25 per cent. of the world market. No film will succeed, especially if it is in English--that is a two-edged sword in this case--unless it is oriented at the international market and especially the US market. Such integration, especially in the distribution and exhibition markets, will operate to the disadvantage of British film makers unless they have access to it. I note that the 1994 Monopolies and Mergers Commission report said that the commission would consult on alignment and minimum exhibition periods. It would be helpful if the Government could say what progress has been made in those discussions.
Although we are not likely to get worldwide integration in the British film industry, one of the Government's responses to the report, which, after all, was brought out just under a year ago, was an advisory committee to consider the problem of integration. Again, I would like to hear what the Government say about that.
To ensure continuity for film production companies, it is important that the issue of tax should be addressed. That has been well and truly rehearsed today, so I will not go on about it. However, only to say, as the Government's response does, that venture capital trusts and enterprise initiative schemes are the answer to the lack of continuity is mistaken. I suspect that the amount of money going into VCTs and EISs for film production finance is disappointing. That calls for more general tax write-offs.
The second major issue is the sort of films that the British film industry makes. There has been slight confusion about whether the British film industry is, as the hon. Member for Heywood and Middleton (Mr. Callaghan) said, a cottage industry making art films or one designed to compete substantively on the world stage. I have reservations about the Arts Council using subsidies to get more involved in film production. That would encourage art house films that may satisfy in terms of their intellectual artistic integrity but do not fully build the British film industry so that it can reach its potential. If the Arts Council of England is going to give £70 million of lottery money by the year 2000 to independent film companies, it should be conditional on a minimum budget size for films and be done on the basis of an active partnership with distributors or exhibitors to ensure that those films get a commercial hearing.
Another slight confusion is the role of television and feature films. Although the BBC, ITV and Channel 4 have to make available 25 per cent. of their product to independent film production companies, that could well be increased. The amount of film being shown on television has not increased significantly in the past 10 years and that is a valuable market for the industry.
On the other hand, the pricing policy has to be genuine. I have had representations from an independent film producer who talked about an effective cartel on pricing between the BBC, ITV and Channel 4--it is even proposed by Channel 5--which he said had contributed to the fact that television production, which was the 17th largest contributor to the balance of payments in 1974, has now fallen into an adverse balance.
We must deal with the problems of tax relief, attitude and structure in the British film industry, as well as taking commercial advantage of the large and increased market that is available to film.
Finally, the recommendations of the National Heritage Select Committee, on beefing up the London Film Commission Initiative and on its co-ordinating role with regional film commissions, which the Government dismissed slightly, are very important. One of the things that will sell Britain is for international audiences to see that films are made well here and are associated with different parts of our heritage.
Mr. John Maxton (Glasgow, Cathcart):
First, I congratulate my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) on his introduction to this short debate and on leading us--I am also a member of the Select Committee on National Heritage--in producing the report.
I shall limit my remarks to the Scottish film industry, to some extent following on from the hon. Member for Wyre Forest (Mr. Coombs). First, I must express surprise at the fact that the representative of the Scottish National party, the hon. Member for Perth and Kinross (Ms Cunningham), is not present for this debate as she has been trying to make considerable play of the role of the Scottish film industry and the Scots in it. Although I share the delight of the hon. Member for Wyre Forest that tourism is coming to Scotland as a result of "Braveheart", as a politician I have reservations about the way in which the SNP blatantly tried to use it to further its cause, particularly when it is such historical nonsense--at least, a large part of it is. It may be a good cowboy film, but it has not got a great deal to do with Scottish history. Although I obviously cannot use the language that Mr. Billy Connolly used to describe it, I certainly share a fair amount of his sentiments.
The Scottish film industry has been undergoing something of a revival with not only "Braveheart" and "Rob Roy" but, more important, films such as "Shallow Grave", "Small Faces" and, of course, "Trainspotting", which represent a much more thoughtful side of Scottish film production.
It may be unusual for me to do so, but I must take the opportunity to say that, at least in Scotland, the Scottish Office and the Secretary of State for Scotland have gone further than their colleagues in the Department of National Heritage to try to bring some coherence to the Scottish film industry. In New York recently, the Secretary of State announced that he is going to streamline the various agencies in Scotland into a new Scottish screen agency, bringing together the Scottish Film Council, the Scottish Film Production Fund, Scottish Broadcast and Film Training Ltd. and Scottish Screen Locations. That is probably a step in the right direction, because it will give a coherence to all those organisations and will mean that they will start to work together.
The Secretary of State has also committed public spending of £3 million to film in Scotland in the next three years. I hope, therefore, that the Minister will promise today that an equivalent £30 million will be spent on film in England and Wales. Using the Barnett formula, that is roughly the sum that should be used to get an equivalency.
In my view, it was not just the tax incentives that caused "Braveheart" to go to Ireland, or even just the use of the army for extras, but the excellence of the Ardmore studio, which ensures that, when one has to move out of location because of bad weather or whatever, a studio facility is available close to hand in which one can do other production work.
The recent Hydra report in Scotland on the film industry suggested building a studio complex of the same type as Ardmore studio just outside Dublin--or even better, in Scotland--and the Secretary of State is committed to considering the viability of the suggestion. That would allow studio work to be done in Scotland, as well as major location work. Then we would have to do some post-production development in Scotland, to ensure the continuation of the whole package and the production of film in Scotland.
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