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The Prime Minister's Speech: Why The British Government's Plan To Shake Up Film Financing Is Wrong-Headed & Doomed To Failure

Features
by Oliver Lyttelton
January 11, 2012 1:58 PM
18 Comments
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Eighteen months or so ago, the British film industry, which relies heavily on states subsidy through money from the National Lottery, was thrown into turmoil when the new coalition government, led by Prime Minister David Cameron, announced that they were shutting down the UK Film Council, the organization that, among other things, was responsible for the allocation of funding for development and production. Those responsibilites were shifted to the British Film Institute, but many in the industry were fearful of what changes were still to come.

And those fears were seemingly realized this morning. A review into the government's film policy by former Culture Secretary and Labour peer Lord Chris Smith is set to publish on Monday, but Prime Minister Cameron seemingly pre-empted its findings this morning ahead of a visit to Pinewood Studios by announcing what he thought the industry should be doing (after a record year for attendances, when the top three grossers were British movies, two of which were independently produced).

Cameron said that he felt that the industry should "aim higher" and produce "more commercially successful pictures" without Hollywood backing, commenting "Our [government] role, and that of the British Film Institute, should be to support the sector in becoming even more dynamic and entrepreneurial, helping U.K. producers to make commercially successful pictures that rival the quality and impact of the best international productions," adding "we must incentivise U.K. producers to chase new markets both here and overseas.”     

Furthermore, perhaps a more telling hint of the report came from Julian Fellowes, the Oscar-winning writer of "Gosford Park," creator of TV smash "Downton Abbey" and a Tory Peer who served on the eight-strong review board, along with Sony Pictures Entertainment chair Michael Lynton, Film4 head Tessa Ross and Big Talk MD Matthew Justice, among others. Fellowes writes in The Times today (behind a paywall) that, "Historically, a disproportionate amount of public money was directed at a type of art house production. Some were excellent, but they were aimed almost entirely at minority markets. This cannot continue, we must have a more balanced approach with greater support for mainstream films because the key to building a dynamic industry will always lie in film's relationship with the audience."

Even worse news seems to come from the BBC. "Today" program Arts Editor Will Gompertz said on the show this morning that, having spoken to a senior person involved with the report, it's expected to shift towards a focus to those with proven commercial track records. If you've made a successful film in the past, it'll be easier to get funding. Gompertz quotes his unnamed source as saying that the new system will focus on, "Movies that people want to see, not luvvies who are your mates," and that "It's over for Mike Leigh," the beloved British auteur whose films wow festival crowds, but rarely become financial triumphs.

Twitter promptly exploded, and while this is pretty grim news all round, it's important to put it in perspective for a second. The review hasn't yet been published, and it's likely to be more moderate than the grabby quotes picked up on by Cameron, who is, after all, pursuing his own agenda. Furthermore, while the review was initiated under his government, it is an independent body, so launching brickbats at the Tories for any findings is simplistic. (Even if it's fun. And it really is fun, because, to paraphrase a "Community" line, David Cameron looks and acts like God spilled a person).

Finally, it seems that there may be some good ideas among the bad. As Ken Loach, the kind of filmmaker who may have his funding source cut off, said on Radio 4 this morning, the report is expected to recommend that rather than returning money to the central body after a film has made it back, it'll be kept by the production companies, who'll be able to reinvest in future productions, in theory creating a more sustainable film industry, which has been the holy grail of British film policy since the dawn of the medium.

So that's the balanced bit, but in most other ways, there seems to be a lot of stupid, terrible ideas being floated here. Firstly, if government subsidies for the arts, or indeed any film, are to exist, surely the point is to enable the production of projects that wouldn't otherwise exist. "The Inbetweeners Movie," the film version of the popular TV series that turned out to be the third biggest-grossing film of the year in the U.K. in 2011, was independently produced, but was always enough of a dead-cert that it didn't need government help. What the review seems to be proposing is that films like that would be favored, over, say "Weekend," arguably the best British film of last year, and one made possible only through funding by EM Media, an East Midlands-based organization backed with lottery money (and a film, which incidentally, received the third-best Rotten Tomatoes score of the year for U.K. films).

Secondly, the characterization by Gompertz of the new policy as "investing in people" sounds good on the surface, but it's terrible news for new talent. As filmmaker J. Blakeson, whose Isle of Man-funded first feature "The Disappearance of Alice Creed" won critical plaudits around the world, landing him a studio gig with Warner Bros., tweeted this morning, "If UK public film financing starts taking fewer risks, it will get harder than ever for a first time director to get a film made, and it is already nearly impossible." Without a proven commercial track record behind you, you'll be a less attractive proposition for your film to receive funding. Where will the next Andrea Arnold come from? The next Lynne Ramsay? The next Asif Kapadia?

And even with that first feature under your belt, it may not make things any easier. Director Rupert Wyatt's Film Council-funded debut "The Escapist" made a meagre $370,000 worldwide, despite critical acclaim, in part thanks to mis-handling by its distributor. Rather than make another British film, Wyatt headed to Hollywood, where he had a half-billion dollar hit with "Rise of the Planet of the Apes." How many other Wyatts or Christopher Nolans will the industry lose to the studios if their first films fail to bust blocks?

Strand Releasing "Tyrannosaur"

And of course, it'll mean a narrowing of production companies actually able to get films financed. The number of shingles with the power to get films green-lit is already slim, but if only the likes of Film4 and Warp can get government funding, because they can point to the success of previous projects, then it'll limit the kind of films that can get made, particularly if the companies are being steered away from "uncommercial" pictures like, say, Paddy Considine's "Tyrannosaur," the kind of gritty drama that's being used as a pinata by the anti-subsidy brigade.

And here we come to the biggest problem with the idea of funding films based on how successful they'll be. It's not going to work.

To quote William Goldman's oft-used maxim: "Nobody knows anything." Cameron and co. love to use recent examples like "Slumdog Millionaire" and "The King's Speech" as shining lights of the kind of film that the industry should be aiming for; British talent and money, critical acclaim, Oscar success, and international money-spinners ($377 million and $414 million respectively, on $15 million budgets). But on paper, they certainly weren't home runs. 'Slumdog' was a mostly subtitled drama about poverty with a cast of unknowns, so commercially unappealing that original distributor Warner Bros. dropped it only a few months before it went on to win Best Picture at the Oscars. "The King's Speech" was famously turned down by most of the big British production companies, and only got the financing thanks to, yes, the UK Film Council. It's easy for someone like Fellowes (whose directorial debut, the dull-as-ditchwater adultery drama "Separate Lies," was also backed by the UKFC, ironically enough, and made only $3.5 million worldwide) or Cameron to laud their success now, but on paper they were the kind of arthouse films that the new policy will ignore in favor, presumably, of period dramas and star-driven comedies.

And going with companies with proven track records isn't exactly a goldmine. Working Title have become, over nearly thirty years, arguably the most successful British production company, thanks to the success of films like  "My Beautiful Launderette," "Four Weddings and a Funeral," "Billy Elliot," "Bridget Jones' Diary," "Love, Actually," "Atonement," "Hot Fuzz," "Senna" and "Tinker Tailor Soldier Spy." But they're also the compnay who ploughed tens of millions into "Thunderbirds," "Wimbledon," "Catch A Fire," "Smokin' Aces," "Green Zone" and "Hippie Hippie Shake" (a film which remains unreleased, nearly five years after it went before cameras). Film4, meanwhile, nearly went under in the early '00s after expensive flops like "Death To Smoochy," "Charlotte Gray" and "Buffalo Soldiers."

We don't say this to embarass anyone. We say this to again illustrate -- no one knows anything. Those films probably looked like good bets at the time. But any policy that can be summed up by saying "we're going to make more successful films" is doomed to failure, because there's no guarantee to success. If there was, film funding wouldn't be a problem because an equation would have told you that, to pick a random example, a film about Edinburgh heroin addicts, "Trainspotting," would prove to gross $72 million worldwide back in 1996. But it didn't -- someone took a risk, and a risk paid off. The homegrown success of "The King's Speech" and "The Inbetweeners Movie" undoubtedly means that we'll see plenty of "safe bets" more period dramas and teen sex comedies from the U.K. in the next few years, but the majority of them will perform more like "The Other Boleyn Girl" and "Sex Lives of the Potato Men" than their more recent inspirations.

Maybe we're wrong, and the report will include plenty of provisions for first-time directors and producers, for a wide range of cinema, for more than just an endless series of sequels to "Johnny English." But after the best year in quality for the British film industry that we can remember, one that saw record-breaking attendances for British film, with not just "The King's Speech" and "The Inbetweeners" performing, but also diverse offerings like "Tinker Tailor Soldier Spy," "We Need to Talk About Kevin," "Attack the Block" and "Weekend," it's depressing to see the industry's decision makers following the same kind of thinking that has left Hollywood studios in a creative slump. A factor that has contributed to the U.S. box office at the end of 2011, being the lowest it has been since 1995.

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18 Comments

  • ng | January 13, 2012 4:58 PMReply

    Cameron and the people who support this kind of approach are simply trying to use a more subtle form of censorship to determine what the film conversations with the public will consist of. We should all be concerned about the narrowing of the field of acceptable dialogue. To me, it's as if he's laying the groundwork to say, sometime in the future, that all films will have to tote the party line; but, of course, the language to silence thought will always cloak the real intention.

  • Tobias Bowman | January 13, 2012 2:57 PMReply

    Agree with Jan. UK film funding changed dramatically in early 2000s. Tax Breaks existed in the form of incentivised legislation targeting individuals incurring high income tax: "Section 42 relief allowed the cost of producing British films to generate a loss which can be offset against other income over a 3-year period. ‘Section 48 relief’ was more generous and allows the loss to arise entirely in the first year of the partnership. In either case the loss could be used against income in the year of the loss or in the previous three years. Film partnerships have traditionally required a 15-year commitment, and have usually been financially complex, but the film partnership scheme attracted about GBP500mn in investment in its first two years." This changed due to anti-avoidance legislation culminating in the 2006 Finance Act. The frustration is that film is not purely a commercial art form and many of the stories that need to be told are not deemed as commercially viable, so require subsidising to get made and require some space within exhibition and marketing channels. As Ken Loach stated, we need more localised, independent picture houses and let the cinema goers make up their mind; not everyone in the UK wants to witness Optimus Prime updating his Facebook profile in the 'Transformers VI' horror show, or some 3D remake Citizen Kane nightmare. Quite frankly Cameron is showing his true ignorant colours, stripping everything back that does not have the overt super purpose of profit, 'in these testing times' which were actually caused by that very attitude. Much of the funding available comes from funding such as the National Lottery, so therefore defining a film as a success in purely financial/awards terms is a complete misnomer. The solution is a complex one but is achievable. In my opinion I think that revisiting the tax-break schemes is the way to go made available with mandatory investment in films within certain budgetary brackets – i.e 500K – 3 mil. That in combination with more transparency and accessibility from regional grass roots organisations who can identify projects of cultural and artistic importance which require developmental support.

  • anonymous | January 13, 2012 1:07 AMReply

    I'm not British but I've loved a lot of British films. While I like some Holywood movies I don't think there is a need for more Hollywood style films. Hollywood doesn't make as many major arthouse films or even middlebrow dramas as it used to and I would hate to see that happen in Britain.

  • Edd Morgan | January 12, 2012 4:03 PMReply

    This article and many of the comments only goes to show how spoilt and deluded people in the so-called British film industry have become. Government subsidies are naturally good to help new production companies get off the ground, but they should be then expected to stand on their own financial feet without further support, or else go bust and leave room for another company. If you haven’t noticed, it’s how any other business works. Working Title have had great successes and flops as well, it’s the nature of the business, and if you don’t like it then pull out, just don’t expect the government to play Daddy whenever convenient and give handouts whenever you want. Critical plaudits and high marks on Rotten Tomatoes mean nothing, the public is the only critic that matters.

    Aiming to make a profit is not ‘selling out’ it is simply good business, as you have in an industry, including a film industry, get it? It also helps prevent filmmakers from disappearing up their own backsides by remembering that they are meant to cater for an audience, especially if they are spending other people’s money. This does it spell the end of less commercial film ventures, but just that a responsible production company can use the profits of more successful and popular productions to fund its more risky projects. I know we all like to boo and hiss at Hollywood studios, but they take risks all the time, winning some and losing some.

    As for saying that ‘nobody knows anything’ (an overused quote fast becoming a bad cliché) it’s no excuse for not trying to appeal to a larger audience. Film industries all over the world do so making both successful and unsuccessful films, but generally staying afloat; why should the UK be any different? I am sick and tired of the patronising attitude in British film circles saying that anything Hollywood is crap and that the millions of people who flock to see those movies (instead of seeing theirs) are clearly misguided and stupid. What a great way to regard the general public! If filmmakers are really desperate to make an arty-farty pet project, they are welcome to do so, but they will just have to fork out the money themselves and face the consequences.

    Stop blaming the government, stop blaming Hollywood, stop treating the general public like morons and start taking responsibility for your own industry.

  • pi | January 12, 2012 8:31 PM

    well said edd morgan, you clearly feel the same way i do. if people dont get that films need to earn money to fund many future films than they don't live in the real world. it about a company standing on it own too feet without the need of shamefully asking the tax payer to fund their films and buy their costly houses. i dissapointed to hear the director steve mcqueen (who is a great director and who's film shame i look forward to see) argue against these ideas but in all honestly he would said that because he has gain from the current system, making him and most other film makers bias because it too cosy for them like ken loach, who would thankfully not survive with future plans because people would not pay to see his dull work

  • Andrew Morris /Andrew Morris Managment | January 12, 2012 3:12 PMReply

    I think the time has really come for the Coalition to stop taking crap about what it thinks is good for the British film industy, and start introducing some policies to generate films and work ;- for a start , they must reintroduce tax breaks to film makers accross the board ;- if people here ae encouraged to make films here, with tax breaks and cost effective production costs , it will CREATE JOBS , as all the supporting roles in the ffilm , on the crew ect , will be hired here . Add to this a policy that percentage of sales and distribution costs , from the top to the bottom at the cinema, where , say every £2/£3 of each ticket , is placed into a National film account to fund future films , the critera of which , can be decided upon via a points system , depending of categories such as subject matter , target audience , local national critera, ect .
    Like other industries , the coalition need to stop diverting any profits made from films , abroad to companies , for short term gain . The french , germans , and other europeans manage to do this with their industies , so we now need to do this with ours . The Government must now start to think and act this way ....oh , and i have already been asked to assist with the policy lobbying !! thank you .

  • pi | January 12, 2012 12:29 PMReply

    Completely disagree with this article and the sheep who agree. Any industry that is funded by the tax payer must be done with purpose. In this case its in the name of national art/entertainment so people accept tax payers money funding culture on the basis that only a few million (under 50 million pounds a year) is spent keeping it afloat but remember 10/20 years of keeping it afloat builds to big money money that could have gone towards more important causes like health and transport etc. You forget this moral debate of whetever any money at all should go towards a non existing national "industry", thats why I fully support the idea thats films should gain back the money and also profit from it, to spend on many more films with a range of budgets. Quite frankly that would build a much more joyful film culture than the one we have now. I love film and aim to make some myself so i do care about the quality and art but why is commerical and popular such dirty words, david cameron never mention it had to be commerical and CRAP. We can have both commerical and good. I would in fact argue Slumdog Millionaire was a commerical film because it had a high profile director (I know because i was looking up the film on the internet before the trailer came out, looking forward to see the director's next film), Trainspotting was based on a best selling book and was the second film made by danny boyle following his hit and well recieved film shallow grave and the king's speech had three stars in it all who have been nominated for a oscar before and the subject matter was about royals. Therefore i would argue that all of these films that were well recieved artistically were infact commerical films from the start.

  • Donald | January 12, 2012 9:49 AMReply

    Very sensible article. This sort of crap comes along every few years. Remember the elaborately wigged Michael Fabricant MP urging UK producers to make more films like the Carry On... pictures?

  • ad | January 12, 2012 9:20 AMReply

    If British film is such a success, why does it need a subsidy? There must be more important things for public money to be spent on.

  • Jan Davids | January 12, 2012 7:19 AMReply

    Good article. Couple of points:
    - nice bit of revisionist historical analysis going on in the media. Remember the UKFC was criticised in indie film circles because it mostly backed "commercial" projects (unlike its predecessor) - so interesting that now it's being held up as an example of promoting indie talent. The idea that the King's Speech is now being highlighted as a publicly funded indie success is also interesting. Would the UKFC have put production finance on the table for The King's Speech if Colin Firth / Geoffrey Rush were not attached and lesser-known actors were involved? I don't think so... So UK public film funds have always (since the onset of the UKCF) considered commercial factors and been conservative in their choices, which is why films like The Iron Lady get made with UKFC money (biopic of well-known figure, clear commercial potential), and riskier projects i.e. by first-time directors who direct spec scripts about fictional characters, have always struggled to get their projects funded (even in indie circles a lot of filmmakers have complained that any public money for indie / arthouse films will automatically go to someone like Ken Loach or Mike Leigh - public funders know that those filmmakers have a reasonable chance of making a film which will do ok financially - not great - but ok - as well as creating critical success to use in their next annual report - so there's always been a level of conservatism.)
    - Many small indie films are much more commercially successful than higher-budget more commercially positioned films i.e. they deliver much higher ROI. Yet, the indie film will be seen as commercially unsuccessful because everything in the industry is measured by box office take, irrespective of the marketing spend and ROI. So not only does “no one know anything”. But even after a film comes out and the box office figures are published, we still know very little about its commercial success.
    - So perhaps we should just accept that in the last 10 years UK's film funders have always looked at the bottom line, that there has been inherent conservatism in their funding choices and accept it for what it is. The idea that there has been a strong cultural element in funding decisions, that talent has been backed before commercial considerations is nonsense. So what can we do? We can get behind Film 4, Warp and other risk takers (go to the cinema to see their films, watch on TV, catch-up / online) to give them more strength to continue their risk-taking approach. And instead of complaining about a system which we’ve had for years, we need to evolve alternative finance strategies for funding films – through crowd-funding, community-sourced support, sponsorship, branding, and investor tax-break schemes (EIS). It's not ideal, but it's better than pretending that the UK film funds are something they are not.

  • anon | January 12, 2012 1:03 AMReply

    wow...great article and great comment annie hall

  • TheoC | January 11, 2012 11:54 PMReply

    Great article, well written / thought out. Nobody knows anything, perfect.

  • ANNIE HALL | January 11, 2012 10:45 PMReply

    clarification on 75/25 - if 75% automatically goes to the distribution company (as with any film produced at any time) 25% of every ticket goes back to the production company - which is usually a group of people who financed; ie channel 4, private investors, venture capitol from here and there, and most of the time, US studios like fox or warners for the big films... then 25% is split between those financiers, despite the "uk studio name" listed on the credits. So in this way UK films don't make even the 25% back per ticket. They may make it back by buying back the rights to show it on BBC, but if they need to make money by showing on cable (Sky Atlantic which opened February last year) then that is another US managed company that gets part of that pay-channel price you spend to watch it. And it was a 'home grown' film that no one at home get's money back from. Even if it's in the Odeon (owners are Australian or Canadian) that ticket price goes to them. So I hope that made it clear - my roommate said it was a bit confusing. Cheers.

  • Annie Hall | January 11, 2012 10:26 PMReply

    What also stands out is the face that the 'teen movie' genres are for UK teens; ie "Inbetweeners". In the rest of the English speaking world, no one watches it and no one cares. It's not aired abroad to reach audiences who'd even know the characters. Also, Working Title is a US run branch, and all the films mentioned from "Four Weddings" to "Bridget Jones" to "King's Speech" were highly employed with US talent, money, distributors and producers in Hollywood of New York (the King's Speech screenwriter himself was from NY just as many other films were, and based on his uncle who went to the same tutor as the king did and who gave him the tutors actual notes of these sessions). My point is, when these articles are written, no one ever looks under the rug to find out just how much abroad money and resources it took to get the film made and bring in the talent and the pounds. Although hard to find at first, you can locate many reports that UK film council had to take leave of it's responsibility of managing for 20 yrs. because it failed to actually bring money back to the UK. Many people were hired but so were others from abroad, and once the film was done, that money went back to its distributors (ahem, not UK - we don't even own the cinemas in England either) so that, and the fact 300K per year was going to Jonathan Ross to "manage" the fund. That was not good news when that was published. Hence, no more UK film council and BFI was probably chosen for "a safe bet" although as the article said and we all know - can't be guaranteed (especially if the country doesn't distribute it's own films. 75/25 is the normal split with any theatre and any film company. UK doesn't even get the 25. Everyone is paid at production and the rest is zero in the bank as any film, even "Slum Dog" chalked up millions. You do the math. It's not the films it's UK's ownership of any of it's films and ability to produce other than local interest stories without help of abroad financiers and talent. "Full Monty" and "Trainspotting"? Not 100% UK owned either. So, no matter who manages isn't the issue. It's the structure of ownership and distribution. But any film guru could have told us that if they looked closer at this issue right?

  • Cinematic_High | January 11, 2012 4:33 PMReply

    It's funny that you mentioned Working Title.....since they're going to continue that slump when Big Miracle comes out.....nobody went crazy for Dolpin Tale....in fact...no one has flocked to a theater to see sea creatures since fucking Free Willie! Great article by the way....it's a damn shame that nobody wants to take risks in cinema anymore.....

  • Vinnie | January 11, 2012 4:19 PMReply

    Thank you so much for writing this and highlighting this issue. All well said.

  • Kieran McMahon | January 11, 2012 4:10 PMReply

    Great article, intelligent, absolutely spot on.

  • Benjamin Vega | January 11, 2012 2:31 PMReply

    Great article. I'm very glad you guys chose to write about this, some of us at the other side of the pond may not have found out about such an alarming development otherwise.
    Here's hoping the British film industry will manage to sort it out, the possibility that a great many little films would never be able to get made is incredibly disheartening

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