The UK’s creative industries represent around 9% of the country’s GDP, according to John McVay head of the UK Producers Alliance for Cinema and Television (Pact). That’s a significant contribution from a sector that overwhelmingly opposed the June 23 decision to leave the EU.
Before the referendum nearly 85% of the members of Pact said they would vote to stay. In another pre-referendum survey done by Media Business Insight 67% of respondents working in the industry said they believed a departure from the EU would be damaging.
Speaking in Cannes at MIPCOM, one of the leading global entertainment markets, a panel of industry heavyweights picked apart the potential problems, which essentially boiled down to two points: the free movement of people and services. These two pillars of EU philosophy are extremely unlikely to continue in post-Brexit Britain given the weight that immigration held in the debate. But the industry is worried that more complicated trade barriers and visa requirements will deter new talent and partnerships from working in the UK.
McVay, who is compiling a report for the government on the sector’s issues and opportunities after Brexit, explains that around 11% of people working in British creative industries are not UK residents: “One of my arguments to government is ‘if we can’t access global talent then we won’t be as good.’ That combination of the best of British talent and the best of the rest of the world’s talent is what has led to us being one of the most competitive audiovisual and creative sectors on the planet.” Richard Johnston, CEO of Endemol UK, one of the country’s largest independent producers agrees: “[The UK] is arguably the world’s leading creative hub and any barriers to freedom of movement are going to affect that, it’s undeniable.”
But of course all this is speculation until the details of a hard or soft Brexit is defined. For the moment at least the Brexit vote has not had any immediate effect (somewhat logical given that nothing has actually happened yet). Rather paradoxically, the falling value of the pound has the potential to have a positive impact in the creative sectors, as the UK becomes a cheaper, and therefore more attractive, prospect for foreign productions. Although Johnston cautioned that the long production cycle of TV means that the reality of this would only be known later down the line.
Another issue regularly raised in the discussions about the UK’s creative industries post-Brexit is that they will lose funding from EU programmes such as the €1.46 billion initiative, Creative Europe. Unless the government replaces this money, it is inevitable that those most affected will be smaller productions. However the difficulty with this discussion is that no one seems to know exactly how much will be needed to replace it. Currently, the UK pays money to the European Commission and it comes out in the form of several different programmes, “I might be a small gallery setting up in Cornwall and I don’t get any Creative Europe money, I get my local council’s money,” McVay explained. “But this is actually European money that was actually money we sent to Europe in the first place.” That anecdote exemplifies what many cannot stand about the EU but Endemol’s Johnston does not foresee a simpler future. Asked if there will be less bureaucracy in the industry after the UK’s departure, he replied: “I doubt it.”
Despite the pessimism on the panel McVay is not ready to write off the UK as a creative hub just yet. Discussing whether the country will lose out to other markets, he said: “Don’t assume that this is a slam dunk, there are opportunities that we will have to take.” Outside the EU the UK industry could improve or change its already generous tax schemes. It would no longer be bound by EU “State Aid” rules that regulate how government subsidies are applied.
As the next stages of the Brexit discussions unfold one thing is certain, if the creative industries want the best deal, they need to get a seat at the negotiation table. The sector is growing quickly, up to three times faster than other parts of the economy. This puts them in a strong position but they are going to need the full support of the industry and clear lobbying points if they are going to be heard.