I make no apology for asking the House now to turn its attention to another area of our activities—to the British film production industry.
I have two things to say at the outset. First, while I personally have no complaint whatever to make about the fact that the Parliamentary Secretary is to reply— because I understand the normal convention of this House, which is that the junior Minister, generally speaking, replies on the Adjournment— nevertheless this is not an invariable rule, as we have seen in the debate which has just concluded. I think that many people in the film industry will be deeply disappointed that the Secretary of State himself has not found it possible to be present, more particularly as it was he who received two recent deputations. I think that they would naturally have assumed that they would have a public reply from the Secretary of State today, which he was not, of course, in a position to give them at the time he received them at the Ministry.
Secondly, I have a personal point to make. I am a member of the Cinematograph Films Council which advises the Secretary of State, and I was one of the independent members of the subcommittee which advised the Films Council. I need hardly say that what I say today is entirely personal and should in no way whatever be taken to be representing the views of either the Films Council or that sub-committee.
However, it seemed to me that Parliament ought to discuss the affairs of the industry if only because at present we are all too acutely aware of the difficulties and confusion which exist. We must all have the greatest sympathy, particularly at this time—at Christmas—with the very many men and women in the industry who are either out of work or under notice that their jobs are likely to be terminated in the very near future. None of us can regard this with equanimity. The proportion of workers concerned is very substantial. It seems to me that, if only for their sake, we are entitled to ask for time to discuss the film production industry.
The industry is suffering from a very severe crisis of confidence. We have had crises in the film industry before, as some of us who are present are well aware. We had debates of great fervour some years ago when the exihibitors were the ones most concerned and we were trying to soften the stony hearts of successive Chancellors of the Exchequer about the Entertainments Duty. But in some way the present crisis is deeper and more worrying. Although one had the greatest possible individual sympathy for many of the exhibitors who were forced out of business, one felt that to some extent they were the creatures of circumstance in the capitalist jungle. Today we are faced with a crisis of confidence among the producers, and this touches us much more deeply because it is not simply a matter of commercial success and failure.
This is a matter of the expression of British ideas, of the emotions of the people, and of artistic creation. I feel very deeply concerned to find that the anxieties in the industry now so closely affect people who have been responsible for the renaissance of British film production. What is worrying is that the very people who have brought such renown to British films in the last 10 years are the most anxious about the future.
I say most emphatically that everyone who is concerned with the film industry has been extremely proud of the immense improvement in the quality of British film production over the past 30 years or so. It is something which gives us very considerable pride and for which we can take great credit. The contrast of the very recent successes, and continuing successes, of British films with the despondency which now prevails seems extremely unfortunate, and it is something that we should do all we can to obviate.
I am sorry to say that the crisis in the industry has also led to a certain amount of bad blood. We now have a position where personalities in the industry are writing letters even to The Times denigrating the efforts of one another. This also is serious because it will make any solutions, in an industry which is beset by difficulties anyway, even more difficult.
The background against which we must consider the problems which face the industry is, frankly, one of an industry which has been in decline numerically, although, as I say, the quality of its product on has on the whole greatly improved. The Guardian the other day gave some figures, which I believe to be correct, pointing out that in 1952 the earnings of the industry were £110 million in round figures whereas in 1962 the figure dropped to £59 million, which in terms of the money values of 10 years ago would have represented no more than £41 million. By any standards that is an enormous contraction. The seats sold in 1952 numbered 1,300,000, while in 1962 the number was 435,000. These are facts to which no one can close his eyes. When an industry has had such a sharp decline as that, any difficulties inherent in it are likely to be intensified. There is no doubt that that is what has been happening in the British film industry.
The complaints which have been brought before those of us who are concerned with this have been two-fold. As one effect of the decline, it is said that films which in earlier years might at least just have paid their way are now not viable commercially, whereas the more successful films are more successful than ever. "To him that hath shall be given" is nowhere better exemplified than in the British film industry at present.
This causes great difficulties and controversy as to methods of showing films and the position of independent exhibitors and so on. It is difficult to suggest any simple remedy for this. The subcommittee of the Films Council has made a number of detailed proposals to deal with some of the difficulties, but I do not think it would be very helpful to our general debate to go into those rather technical details today.
The major complaint is about the monopolistic tendencies in the film industry which have been evident for very many years past and about which we had reports some 20 years ago. The decline in the general size of the industry has intensified the monopoly.
I think that the House is aware of the general background. There are two major circuits in the British film industry—Rank and A.B.C. They are far more than retail outlets. Both organisations are vertical combinations and concerned with what one would call in any other business the retail, the wholesale, the manufacturing and the financing operations of film production. By and large they do not compete with one another. In the jargon of the film world, they are a "duopoly". They have spheres of interest. They divide the territory between themselves. Each has in tow a number of major distributors which rent their films regularly to either one or the other of the circuits. There is no real competition. There is only one firm which even attempts to rent to both equally, and that is British Lion, about which I should like to say more in another context.
Everyone who knows anything about the industry realises that there is virtually no competition between the two great circuits for films, and although when one looks at the statistics one might say, "How can one pretend that there is a monopoly in cinemas in this country when the circuits own only about a quarter of the total number of cinemas still open?", statistics, as usual, mislead. When one looks at the capacity and earning power of those cinemas one finds that they account for about 70 per cent, of the total earning capacity, and, in particular, they have the overwhelming position in the London area, where so much of the takings come from.
This position of monopoly, which is undoubted, has its good points as well as its bad. One must be fair. There is no doubt that both the Rank Organisation and A.B.C. have financed British film production, either their own or other people's in the past. They can fairly say, "We have shown a great many films which, commercially, were not particularly attractive, but we felt we were obliged to do so, to take the bad with the good." They can rightly say that many producers would have been far worse off had it not been for the existence of the circuits and for their finance.
Notwithstanding that, and giving all credit where credit is undoubtedly due, the fact remains that among some of the best and most original of our film producers there is the greatest possible reluctance to feel that they are dependent exclusively on one or other of these two circuits for their well-being. If one is dealing with people of creative talent these feelings are of considerable consequence.
The immediate cause of the difficulties with which the industry is confronted and of the ill-feeling which, I am afraid, has been aroused, was the assertion by a number of independent film producers that their films have been held up, that they have not been booked by the circuits and that, consequently, money invested in them is tied up and has not become available for ploughing back into future production. This has led, it is claimed, to the situation in which, for example, at Shepperton Studio there is no film on the floor and none in prospect for at least three months, while another studio is closed completely.
The independent producers concerned say that they are quite unable to make any plans for the future or obtain any finance for fresh production. I repeat that this applies not only to those who are not, perhaps, of the very first rank in film production, but also to those who have a very fine reputation.
The facts have been bandied about by the various interests concerned in such a way that it is extremely difficult for outsiders and even for some people inside the industry to know exactly where the truth lies. There are arguments about the quality of the films which have not obtained early bookings. There have been arguments about their profitability and about the wisdom or desirability of showing a number of American films which are, in the opinion of those who should know, at least no better than some of the British films not yet shown.
Various suggestions have been made about how one could clear this backlog of British films, and, what is even more important, of restoring confidence sufficiently to get the production process going again. As is well known, it has been suggested that a quota of 50 per cent. should be laid down for the showing of British films instead of the present quota of 30 per cent. At present 30 per cent. of British films have to be shown by the major circuits and those in favourable exhibition positions. But the actual proportion of British films played by the major circuits is already considerably above the quota—about 45 per cent. in the case of Rank, about 50 per cent. in the case of A.B.C. and, I understand, about 43 per cent. for Grenada.
The Cinematograph Films Council discussed this recently and, by a fairly close vote, decided not to recommend that the quota should be raised. There are arguments for and against. I think that raising the quota would bring only a temporary palliative. I do not believe that it would really solve the problems of the industry.
The real anxiety is not about what films are to be shown in 1964, for they are mostly already made or in the making Indeed, one of the depressing facts of the situation is that there are a large number of British films on the stocks already and people are asking when time is to be found to show them. Unless producers know what proportion of British films is likely to be shown in 1965, production is not likely to get off the ground in 1964 and finance is not likely to be forthcoming.
While I appreciate the difficulties of increasing the statutory quota for 1965, or of the Secretary of State saying in advance that he will do so, it might be a gesture if the two big circuits were voluntarily to indicate that they would play no less than the proportions they are playing already of British films. Why should they not do this? Why should more than half the films shown in this country be from overseas?
What would people say if more than half the books sold in the country were by foreign authors and could be bought in only two chains of shops? It is not unreasonable, when we have people waiting to make British films, for the two big circuits to say voluntarily that, in 1965, they will play at least as many British films as they are playing now.
This would, I believe at least help us to break this log jam of films at the moment, but, of course, there are wider considerations and although it would be very valuable it would still only be a temporary boost to confidence in the industry. Many people believe that the present position, with its duopoly, is unhealthy and that the independent producers will not feel able to give of their best while they are at the mercy of the judgment of only two big groups for the booking of films.
There was once a third circuit. It was in the Rank Organisation and we felt that it was not entirely convincing, as a third circuit, but it was nominally such. What the independent producers and others, including the unions in the industry, are concerned about is that there should be some third force. I am not using the words "third circuit" because we must be realistic and recognise that, with the contraction of the industry, to establish now a third circuit comparable in size with the existing two major circuits would be very difficult.
But if one could have a third booking force which to some extent overlapped the two circuits, we might meet the demands of the independent producers. They would feel that at least they had a chance to prove whether they were right orwrong—a chance they do not always have now.
We could have an organisation which could, for instance, get the best playing times in the year— which they do not always get at the moment— for independent films. If distribution were so organised that some of the Rank and A.B.C. cinemas, with some of the independents, including, I hope, the smaller circuits, could be used for the showing of films which, to the booking organisation, seemed to be the best, we would avoid the genuine objection to a third circuit that it would diminish the possible total earnings of the top winning films, which, of course, would be to the detriment of British film production.
I believe, therefore, that we must devise a system whereby the top winner could still take as much money as it does now on one of the circuits but that, nevertheless, when not playing a top winner concurrently there was a chance of getting a good return for one of the independently produced films. I fail to see, however, how such an organisation as this could come out of the existing industry without some Government guarantee. We have the examples of the National Film Finance Corporation and other devices in which Treasury money was used and from which, surprisingly, Treasury money is now coming out again. With the present state of the film industry, I see no possibility of such a project without some outside intervention.
I cannot see why the Government should not be able to give financial backing on the exhibition side in the same way as they have in the past on the production side. I do not suggest that the body to organise such a third force is necessarily the N.F.F.C., because in a way that would be setting up another vertical combination, which might also be undesirable. However, it appears to me that we will not get what is necessary for the health of the industry without at least a Treasury guarantee and probably some money in support.
Whether we would get agreement from the circuits to a voluntary arrangement of this kind is not for me to say. I do not know whether the Parliamentary Secretary is prepared to say what the Government would do if there were no voluntary agreement. However, if we embarked on this course, we would meet what has been a continuing source of frustration and discontent in the production industry. I say this at this moment especially, because today we have been told of another fact which will very much affect what may be called the psychology of the independent producers, namely, that the N.F.F.C. has bought out British Lion from the other directors. We very much wish to know—and I trust that we shall be told today—what the plans for British Lion are.
British Lion has been a buffer between the independent producers and the vertical combines. I do not pretend that everything that British Lion has done has been necessarily unimpeachable, but, on the other hand, it has been responsible for some of the best, most successful, most original and most distinguished British films. I am certain that if British Lion were allowed to go out of existence, or to be sold to private interests, the cloud of despondency already over the independent producers would become dark indeed.
Therefore, although we were gratified to learn that the N.F.F.C. has exercised its option and that British Lion for the time being is to be entirely in public hands, the statements by Sir Nutcombe Hume and Mr. John Terry as reported in today's Press leave some big question marks. What is to be the posi- tion of the existing directors, who have been a successful team? It is true that they have done much better financially from the bargain which was made than might have been supposed some years ago. On this side of the House, we sharply criticised the terms of their original contract, but a lot of water has flowed under the bridges since then and we do not propose to go over past history, although some of our criticisms were fully justified.
We are now more concerned about the future of British Lion. The suggestion that British Lion is to be sold to some private interests, unspecified, is something which we on this side of the House are not prepared to countenance, and we ought to make that clear. We are, therefore, entitled to be told what the proposals for British Lion are, how its independence is to be safeguarded and how it is to continue to improve the service which it has been able to render to independent film production in this country.
I have already taken more time than I intended, but it is only right that we should have these considerations before us. I hope that the Parliamentary Secretary will be able to tell us the Government's views on a third circuit, rather, a third booking force—it is difficult to get out of the old term—and on British Lion. There is a minor but important point concerned with the hold-up of films, and this is the statutory duty on companies not to book films more than six months in advance. This was inserted in the cinematograph legislation precisely for the purpose of ensuring that there was room for films from independent producers. While I have no doubt that the law has been observed in the letter, it appears not to have been observed in the spirit. I should like some comments from the hon. Gentleman on that point. I hope that before we finish the debate we shall be able to send a message of much better cheer to the British film production industry.