Creative Industries (Economic Impact)

– in the Scottish Parliament at on 3 September 2015.

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Photo of Tricia Marwick Tricia Marwick None

The next item of business is a debate on motion S4M-14048, in the name of Murdo Fraser, on the economic impact of the film, television and video games industries.

Photo of Murdo Fraser Murdo Fraser Conservative

Parliamentary reports come and go. This one happens to be the Economy, Energy and Tourism Committee’s 47th report of this session. I have counted them all out; I have counted them all in. We have had a few wins, a number of defeats and many a scoreless draw. Sometimes, there is a report that cuts through the morass—the fug of bureaucracy—and finds itself in real danger of making a tangible impact. That could be about timing, asking the right questions or simply the power of the evidence that the committee has heard. This is one of those times when the response is more than cursory, polite or, in the phrasing of Eric Blair,

“designed ... to give an appearance of solidity to pure wind.”

The committee’s report on the economic impact of the film, TV and video games industries has been rather well received. I have been through the Scottish Government’s response with my red pen and made a good many more ticks than I had expected to. I even made double-ticks, particularly where the words “agrees”, “accepts” and “welcomes” appear—and they appear frequently. That the Scottish Government, along with Creative Scotland, Scottish Enterprise and others, has accepted so many of our recommendations is indeed pleasing.

I have been called a few things in my time, but churlish is not one of them. I am pleased to report that we even managed to coax a pair of cabinet secretaries along to our final evidence session. Two for the price of one.

The test, of course, will be in putting the policy statements into practice. Fiona Hyslop has said so herself. We will wait and see what comes of the work of the newly announced film industry leadership group. The committee is looking for credible leadership, an inclusive approach, expert and timely advice, sustainable funding, the co-ordination of agencies, the nurturing of new talent and that apparently perennial but now most pressing of issues—the need for a film and TV studio here in Scotland.

I suspect that we all have a favourite Scottish film. It might be “Trainspotting”, “The Prime of Miss Jean Brodie”, “Local Hero” or “Sunshine on Leith”. However, I wonder how many of us know how much the Scottish film industry is worth? The answer is £30 million. To put that into context, the United Kingdom film industry is worth £1 billion. We are punching so much below our weight that we are barely tickling the potential of what could be achieved.

It might be going too far to borrow an expression of Gandhi’s. When asked what he thought of western civilisation, he said:

“I think it would be a good idea.”

It might be a little bit too harsh for me to say, when asked what I think of the Scottish film industry, that I think that it would be a good idea. However, we have to ask where the next Scottish film will come from—the next “Local Hero” or “The Prime of Miss Jean Brodie”. The answer is, I am afraid, that it is unlikely to be made here in Scotland—not unless we are more serious about upping our game.

The creative industries matter to our economy. We ought to be supporting, sustaining and celebrating them accordingly. The Scottish Government estimates that the sector is worth £5 billion-plus, employs more people than the oil and gas sector, and boasts a higher gross value added than life sciences.

The committee’s inquiry considered three areas: film, which I have touched on briefly; TV, which I will come to; and video games, the passion of my children and I suspect of many adults, which I will keep till last.

I am sure that plenty of us are fans of “Game of Thrones”, but do we know that the people who made it originally wanted to film it in Scotland? Iain Smith of the British Film Commission told us that tale in evidence. The makers knew that Scotland was bigger and could offer more locations, but there just was not the shooting space inside. He told us that a show like that cannot be made entirely on location—it would not work. So, up stepped Northern Ireland. It had Titanic Studios, which sealed the deal, and the rest is history—well, not history exactly but a story of ambition, sex, warmongering, murder and dragons. We can draw our own comparisons with Scottish politics today—although perhaps we have fewer dragons. That story is now earning Northern Ireland’s economy some £40 million a year. On the back of “Game of Thrones”, Northern Ireland has built a wider TV and film industry based in Belfast.

The TV industry here declared itself to be, in the words of one witness, “depressed and disillusioned”. They wanted to know what the strategy was for better supporting the independent sector; they wanted less reliance on lift and shift, so that more programmes could be made in Scotland and in a more sustainable way; and they wanted broadcasters to look beyond the limited and some would say myopic vision of London-based commissioners.

However, let us not be excessively glum—there are good stories to tell, too. Take “Outlander” for example, a huge TV success in the US—described, would you believe, as a feminist “Game of Thrones”. It is filmed entirely in Scotland, some of it in a studio in Cumbernauld and some on location, including at Doune castle and Culross, both of which happen to be in the region that I represent. I believe that VisitScotland is drooling at the potential for bumper visitor numbers on the back of that.

The numbers that relate to the video games industry in Scotland are something that we can all shout about. We have just round the corner Rockstar North, our new neighbours in the old Scotsman building. With the mind-bogglingly successful “Grand Theft Auto V” and—every child’s favourite—4J Studio’s all-conquering “Minecraft”, Scotland has two of the world’s fastest-selling entertainment products ever. That is extraordinary.

Perhaps we have not always appreciated the scale of that success or understood what the sector needs to sustain it. Creative Scotland’s Janet Archer told us as much. 4J Studio’s Chris van der Kuyl acknowledged the support that the fledgling industry had received during the 1990s from Scottish Enterprise. He told the committee:

“this is not a bleating session.”—[Official Report, Economy, Energy and Tourism Committee, 14 January 2015; c 24.]

He said that it would still be possible to gather the key players from the companies and agencies into one room to produce a coherent plan and that video games could transform Scotland into “the Seattle of Europe”.

However, the evidence showed that we want those who are developing the games to be more entrepreneurial and the agencies supporting them to be more agile in working alongside such a fast-moving industry.

The so-called gameification of other areas—whether education, health or tourism—is a fascinating development. “Minecraft” has been described as the world’s single biggest educational tool and we were told of games companies in Glasgow and Dundee working in collaboration with Cancer Research UK—a glimpse of the future.

Back to the here and now, there are two specific matters that came out in our report that I wish to raise with the cabinet secretary. I would be grateful if she could try to address both of them in the course of the afternoon.

First and foremost is the film studio. We heard in evidence just how important it is to Scottish producers both in film and TV that we have the studio capacity here in Scotland. At one time recently there seemed to be at least three separate bids coming forward, although there might be more—one at Loanhead, one in Cumbernauld and one in Glasgow. We need to know what is happening with that. What is the latest and what happens next? We understand that the Scottish Government cannot set up a film studio and cannot entirely fund it, but how will we decide which of the projects finds favour, what is the process for getting there and what is the likely timescale?

The second key point is the working relationship between Creative Scotland and Scottish Enterprise—or, I should say, the non-working relationship. Whether there was a clash of cultures or of personality or it was a case of conflicting priorities, the evidence was that the relationship was simply not harmonious. One witness even imagined the behind-the-scenes conflict as being on a par with “Borgen”. I hope that the cabinet secretary will update us on the latest episode in this drama, perhaps with a happy—and preferably non-fictitious—ending. That is a serious point, because our creative industries’ success is reliant upon coherent leadership.

The Scottish Government has declared its ambition for Scotland to be one of the world’s leading creative nations. All those working in film, TV and video games—and the committee—share that ambition. We have the talent, location and the innovation—all the necessary ingredients—but we must turn the bold statements and best of intentions into solid actions and sustainable outcomes. I commend the report to the chamber and I have great pleasure in moving the motion in my name.

I move,

That the Parliament notes the findings of the Economy, Energy and Tourism Committee’s 4th Report, 2015 (Session 4), The economic impact of the film, TV and video games industries (SP Paper 704).

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

I thank the committee convener for his opening remarks and I welcome the inquiry and this debate as an opportunity to shine a spotlight on the sector. They are very timely, because they come at a time of significant development for the sector. The Parliament is shown at its best if it can look at such an important sector, provide recommendations and see our response to those recommendations as part of the development. The debate is taking place at a time when much is happening that we can share. We are in a time of good momentum for the sector, although there is much to be done.

The convener was correct to identify the sheer scale of the success of “Outlander” not just in promoting Scotland but in providing jobs, skills and production. That is very significant at this time.

On 28 May, the Scottish Government provided a very full response to the report of the committee’s inquiry. I look forward to seeing Murdo Fraser’s ticks and double-ticks, if he forwards them to me. As outlined in that response, we have already actioned a number of the recommendations.

In March this year, the Government published “Scotland’s Economic Strategy”. The creative industries were reaffirmed in that strategy as one of our key growth sectors. The creative industries employ more people than the oil and gas industry in Scotland and generate a higher GVA than the life sciences sector. We said that quite deliberately, because it is important that we give the sector the space, time and attention that other sectors in the purview of the public sector and Government receive.

Support for the creative industries has also been articulated in our programme for government. In that context, the Deputy First Minister and I have made clear to Scottish Enterprise and Creative Scotland that a memorandum of understanding must be put in place to ensure clarity of respective roles and set out effective joint working, so that support from those agencies to the sector is co-ordinated. That issue was identified by the committee and it is one that we are conscious of and able to deal with. Over the past few months we have made significant progress in bringing together those agencies to focus on how they can work collectively.

Photo of Gavin Brown Gavin Brown Conservative

The Government said pretty clearly in its response that the memorandum of understanding was a priority and would be set up and in place by August. Has that happened?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

In terms of progress, I am also committed to updating the committee on the timing of the release of the memorandum of understanding, and to ensuring that the committee and the industries are kept abreast of it. Over the summer, Scottish Enterprise and Creative Scotland have been meeting the industries, to seek their understanding of the importance of the clarification of those roles.

I will deal with the four areas that the committee focused on. The committee recommended that the Scottish Government evaluate what further support or incentives it could provide to the Scottish screen sector. The film studio is still subject to negotiation with the private partner and progress is being made but, as the committee inquiry found, a studio on its own is not the only answer. It is important to have additional incentives to stimulate interest and investment from the private sector in our screen sector, and to enable us to compete with other locations.

That is why I am pleased to inform the Parliament that the Scottish Government and Creative Scotland have today launched a new £1.75 million production growth fund for film and TV. The fund, which will run from 2015 to 2017, is expected to attract more large-scale film and TV productions to Scotland and is the latest in a series of measures taken by the Scottish Government and its agencies to support the Scottish screen sector to grow.

The production growth fund and the £3 million of additional support for film production skills development that I announced earlier this year further enhance the package of public support for the screen sector over 2015-16. New figures show that public sector screen support for 2014-15 totalled more than £24.1 million, an increase of more than £2.5 million from 2013-14 and an increase of almost £8 million since 2007-08. In difficult times, people in the chamber will recognise the progress that we are making, so I hope that members appreciate and welcome that on-going support.

On video games, another set of welcome figures are those that were recently published by TIGA, the network for game developers and digital publishers, which showed that employment in the Scottish video games development sector grew by 9 per cent in 2014. That means that Scotland now represents 11.1 per cent of the United Kingdom’s total games companies, compared with 8.8 per cent in 2012. Scotland also represents 9.7 per cent of the UK’s total games developer head count, which is up from 9 per cent in 2012.

Those figures are extremely encouraging, but I also agree with the committee’s recommendation that a detailed review and analysis of the Scottish video games sector is required to understand the financial and business support that it requires. Creative Scotland and Scottish Enterprise are therefore taking forward an initial process of monitoring the video games sector through a set of surveys that will be conducted over the coming year and will be produced in collaboration with the Scottish Games Network. The outcomes of the survey will ensure that public sector support is tailored to the needs of the video games sector, enabling it to grow and develop further.

In addition, the digital media strategy will launch this month. It will be followed by a series of focused sessions with sub-sectors, such as video games, to promote the strategy’s messages and bring the creative industries that utilise digital technology into the implementation of the strategy.

The committee made a number of recommendations regarding a sustainable Scottish television sector. I am already working with the broadcasting sector to determine what changes might be required to achieve a sustainable and growing sector, and the First Minister recently outlined the kind of federal model for the BBC, as part of the charter renewal, that we believe will allow us to achieve that. I am pleased that the Government recently signed a memorandum of understanding, along with the Scottish Parliament, on taking forward some of the renewal process, and we are currently in discussion with a range of stakeholders on developing policy options for broadcasting. I intend to discuss with all parties in this Parliament the emerging ideas that are gathering support, so, collectively, we have the opportunity to influence the BBC, particularly on the need to abandon the reliance on lift and shift, as identified in the committee’s report, to increase commissioning and production and to increase the skills and expertise in the Scottish TV sector.

Skills Development Scotland has published its skills investment plan for the creative industries. That was done at the end of June and a skills forum has been set up to implement the plan. The actions identified in the plan will enhance the sector. That follows the launch of the information and communications technology and digital technologies skills investment plan in March 2014, which also came from Skills Development Scotland, with £6.6 million from the Scottish Government. Plans to promote that are in production and are also being effected and are supported by funding.

I am conscious that I have only a short speaking slot and that I have touched on only a number of key areas arising from the inquiry. I refer members to the full response from 28 May, and it is my intention to write to the committee convener shortly with a more detailed update on progress against all the recommendations that were set out by the committee. I welcome the debate, which is timely, on an exciting sector for Scotland. Let us take this forward.

Photo of Claire Baker Claire Baker Labour

I start by thanking the Economy, Energy and Tourism Committee for providing a wide-ranging and engaging report on the creative industries in Scotland. The committee seems to have been effective, with money announced on the morning when the cabinet secretary was due to give evidence to the committee, and money announced this morning as we were about to have this afternoon’s debate, so I am pleased that the committee decided to hold the inquiry.

With more than 100,000 jobs, more than £12 billion in turnover and more than £6 billion in gross value added, the economic contribution of the arts and creative industries must not be underplayed. The committee’s report raises many important points that we must engage with in this short debate, including the issue of a film and TV studio in Scotland. When I first took on the role of Labour spokesperson on this area, the studio appeared to be imminent. There had certainly been a lot of interest in Scotland, as Murdo Fraser said, but so far nothing has come to fruition.

Over the past nine months, we have seen action, but not in Scotland. In June, Screen Yorkshire announced its plans for a new film studio just outside Leeds. That means further competition for the sector in Scotland; indeed, Screen Yorkshire has already started to show productions around its potential studio. Scotland has the skills and talent to be at the forefront of the film and television sector not just in the UK but throughout the world, but we lack a studio. Recent successes of films shot in Scotland include “World War Z” and “Sunshine on Leith”, and there have been high-quality TV dramas such as “Outlander”. However, for every “Outlander”, there is a “Game of Thrones”, and major productions have been missed due in part to the lack of studio infrastructure.

Moreover, Scotland’s rising talent all too often feels the need and urge to go further afield to fulfil its potential. If Scotland had a film and TV studio, it would go a long way towards ensuring that skills and talents were retained and developed here.

We also need clear leadership, and one of the issues raised in the report is the confusion over the roles of the Scottish Government, Creative Scotland and Scottish Enterprise. We need clearer leadership from those organisations to ensure that we have a sustainable sector and a vibrant Scottish film and TV scene. The cabinet secretary mentioned the memorandum of understanding but, in her reply to Gavin Brown’s intervention, she seemed to suggest that the situation was quite challenging and that we did not have the MOU yet. Is the cabinet secretary confident that all partners are committed to delivering for the sector?

I welcome the fact that the report and the evidence that the committee took seem to have forced the Government into action, with the creation in May of a film industry leadership group. The Scottish Government welcomed the establishment of the group so much that it was announced three times in the space of three paragraphs in Tuesday’s programme for government. I think that there might have been a typo in there, but there certainly seemed to be a lot of repetition of a certain paragraph. In any case, that must be only the start. Although we recognise the economic significance of the creative industries, the fact is that Scotland spends only £6.9 million on film.

One area in which support could be increased—and which must be debated in the context of BBC charter renewal—is lift and shift. I welcome the news that the quotas set by Ofcom for original productions by public service broadcasters are being met, but the lift-and-shift policy can be detrimental to the sector in the long run by failing to provide employment opportunities for the local TV industry. If we are to develop a sustainable TV sector in Scotland, the policy must be improved and must bring greater value to the sector. I was encouraged to see in the committee’s report that the BBC has acknowledged the point and has recognised that the policy was a short-term mechanism for accelerating investment and that it now needs to ensure that companies that are based in Scotland are winning entirely new business and are drawing on the local population and talent base.

Beyond lift and shift, the charter renewal process must also look at the competitive challenges that face the BBC in the years ahead. I am not convinced that the solution is the creation of a Scottish-only channel; indeed, I have yet to see evidence that the Scottish public are calling out for that. The cost of setting up such a channel would be considerable, and at a time when the BBC is essentially having its budget cut by the United Kingdom Government, we must ask whether such a move is an appropriate use of licence fee payers’ money.

I do not believe that the answer is a federal system within the BBC, as that would be the first step towards the BBC’s break-up and would weaken the corporation. The First Minister’s comments at First Minister’s question time suggested that the proposal was more about politics and control than about what is best for licence fee payers. The model also raises concerns that, as we saw with STV and Downton Abbey, if we move to buying and selling programmes, we could find popular programmes being shown in other parts of the UK and not being available in Scotland.

If we want to be bold and radical, we must face up to and address the challenges and opportunities that lie ahead for the BBC. The world of broadcasting is changing rapidly with BBC3 being moved online and more and more people using iPlayer, Netflix or other models, and we need to be more imaginative in finding solutions. If we are not, I fear that the BBC will be at risk of being attacked by the Conservatives while being squeezed by the Scottish National Party.

The committee has done an excellent job in highlighting the sector, and I thank it for its work.

Photo of Gavin Brown Gavin Brown Conservative

I, too, commend the committee for its excellent work and its very robust report, which, I think, has already made—and will continue to make—a practical difference.

Of course, the Government will be judged not by its written response to the report but by the action that takes place on the ground as a consequence of it. We should be very proud of our film, TV, animation and video games industries, but there is much more to be done and, frankly, I think that we should be doing a lot better than we currently are.

One of the bits of the report that jumped out at me was about the lack of co-ordination between Creative Scotland and Scottish Enterprise. I was not on the committee so I did not hear the evidence first hand but, when I read through the report, that point jumped off the page.

Iain Smith of the British Film Commission said that Creative Scotland was

“not systemically set up to deal with the configuration of the business”.

Ken Hay said that Creative Scotland and Scottish Enterprise worked in isolation. Bob Last, an independent producer, said that the agencies

“have been set up to fail”.—[Official Report, Economy, Energy and Tourism Committee, 21 January 2015; c 36.]

The committee concluded at paragraph 76 of its report, without anyone disagreeing, that

“The separate and distinct remits of Scottish Enterprise and Creative Scotland are acting as a barrier to working cohesively to effectively support the film industry.”

In committeespeak, that is a damning conclusion. It is a conclusion that, frankly, should have shocked the Scottish Government and pushed it into action, yet five months down the line it is difficult to establish what progress there has been.

We even had Creative Scotland giving evidence, saying that it had not been set up in a way that enabled it to engage with other public bodies. I had to read that several times to make sure that I had done so correctly, but I think that I did—Creative Scotland was set up so that it could not engage with other public bodies.

When I asked the cabinet secretary earlier what has happened with the memorandum of understanding, I was disappointed with the response. I assume that the response was no—it was not stated quite as clearly as that—but the Government said in its response to the report that it was going to host a series of workshops and it was going to establish clear links and all that would culminate in a memorandum of understanding between Creative Scotland and Scottish Enterprise, which would be published by August 2015. Clearly, that memorandum was not published by August 2015, but it is not even clear at this stage when it will be published and what the barriers are.

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

The workshops have been taking place and the memorandum of understanding will be published, but the creative industries partnership that brings together the bodies met only on Monday, so the timing might mean that the August date for releasing it has been missed.

Photo of Gavin Brown Gavin Brown Conservative

I am not sure whether I am more or less confident after hearing that response. It was set out in a formal response to the committee by two cabinet secretaries that the memorandum would be published by August. Five months down the line, we are just hearing that it will be published; we do not know when it will be published. If it has taken that long to get to a memorandum of understanding, it does not fill me with excitement about where we are going to take things. The Scottish Government needs to do far better in that area.

Clearly, a number of welcome structural changes have been announced by the cabinet secretary, either in the response to the report or today. Whether or not the fresh funding flowed from today’s debate is not hugely important in my view. The fact that the funding has been announced should be welcomed. However, we will not hear the results of how it functions until a bit later on and we obviously want to see those results, because I think that there were a couple of other funds—I noticed Murdo Fraser’s questioning of the cabinet secretary during the committee stage about the loan fund for studio development; none of that money had been drawn down at that time. It is great to announce such things, but it is important that the money is drawn down and flows to where we want it to flow.

In my final minute, I want to touch on the video games sector. I was struck by the quotation that we want to and could become the “Seattle of Europe”. I think that that is a terrific ambition. However, if we are going to achieve it, we have to have far better figures and better knowledge of the economic impact of the video games industry. It is a dynamic, quickly evolving industry but, when I look at the Scottish Government’s response to the committee, I see that it is still relying on figures from 2013 for employment and from 2012 for turnover. That is a couple of years’ gap. Given that employment in the industry doubled between 2011 and 2013, I have to say that we are not going to become the Seattle of Europe if we rely on figures that are two years out of date.

You are signalling to me, Presiding Officer, so I am content to leave it there.

Photo of Christian Allard Christian Allard Scottish National Party

It is a bit difficult to follow Gavin Brown because, after the committee convener’s opening speech, I had thought that we were going to have a very consensual debate in which we acknowledge that the Parliament and its committees work very well, even aided by a member of the Opposition, and the Government responds with a reassignment of funding.

On the back of today’s debate, I would like to make a plea for my region, the north-east of Scotland.

A few weeks ago, I was denied a visit to the fantastic harbour of Portsoy. A couple of security personnel with what I recognised to be a Glasgow accent told me that the remake of “Whisky Galore!”, based on the true story of the SS Politician, had chosen Portsoy as a prime location. I asked them in my well-recognised north-east accent where else the shooting was taking place and they told me that it was taking place all over the east coast. The day before, they had been in Pennan, the home of the iconic red phone box, and later in the week they were going down to Fife, where a lot of the popular television series “Outlander” was shot. I pointed out to the two gentlemen that all those locations were quite far away from where they came from. They were not complaining—the weather was fantastic.

A few weeks after that encounter, it came to me that the film industry in Scotland should be based in a central location. I give you Dundee. Over the past few decades, Dundee and the north-east of Scotland have developed and established a well-respected place in the growing industries of film, TV and video gaming. That is highlighted in the committee’s report. I am delighted that the committee looked at this area, because the film, TV and video games industries are, as we have heard, primarily industries that generate employment and a vast amount of revenue for Scotland. The Parliament recognises their true economic value, and so does the Government.

I want to make my case for Dundee and the north-east to the Scottish film studio delivery group. The success of Dundee in the film, TV and video games industries is to do with not only its central location but the creativity of its people and their ability to attract creative people to live and work in the north-east. I cite the examples of Aberdonian film director and producer Jon Baird and the global hit computer puzzle game whose creators first met at a Dundee computer club.

The economic and cultural impacts that come from the creative industries are clear, strong and evident in the committee’s report, which was published in March. I thank the committee for its acknowledgement of the need to review the current overarching lift-and-shift arrangement that operates among the large producing companies that are based in Scotland. The use of that method in the television and film industry is discarding another generation of Scottish talents and products.

In a bid to enrich and maintain the creative industries in Scotland and provide opportunities, it would be highly valuable for the new purpose-built film studio to be based in the north-east, in Dundee. The city of Dundee, which is understood as the small city of the future by the Small Society Lab, has a long and rich history in the creative industries. The promising future of Dundee could be made present with the new studio, which could allow it to exceed current aspirations for video gaming, TV and film. Everything could be under one roof in Dundee.

I want to make a final point about an article by Kevin McKenna in The National, in which he talked about the BBC TV production “Bob Servant” or, as he put it,

“the infantile Bob Servant, which is about as funny as dooking for chips.”

He added:

“Who needs England to misrepresent us when we seem perfectly capable of doing it ourselves?”

That is a fair point. However, when I first listened to “Bob Servant”, it was on BBC Radio Scotland. It was a fantastic programme that perhaps did not convert well to television.

Photo of John Scott John Scott Conservative

You might wish to draw to a close.

Photo of Christian Allard Christian Allard Scottish National Party

We need to give the industry time to flourish to make sure that we produce programmes in the future that are as good as possible.

Photo of Johann Lamont Johann Lamont Labour

I add my thanks to the witnesses who gave evidence to the committee in what was an important inquiry. I was struck by the evident hunger of many people in the film and television industry and the video games industry for the inquiry, and by the robust way in which they highlighted their concerns about the circumstances in which they are operating. The challenge and the test for members of the Parliament will be for us to respond to the anger, the frustration and the sense of concern about what is happening in the sector, rather than hugging one another in recognition of what a great inquiry it was. We must not become another part of what has been a very dispiriting process for far too many people in film and TV in particular.

We should be concerned about what the evidence shows is frustration and resignation. There is a stark contrast between the energy of the sector, which is fleet of foot in business terms, in that it develops new ideas, takes risks and creates opportunities for skills and talents to thrive, and an unbelievably slow and bureaucratic process, in which it appeared that having meetings about important issues was considered the same as taking action on those issues.

I say to the cabinet secretary that her explanation that the commitment to have a memorandum of understanding in August was not fulfilled because the bodies did not meet until Monday is no kind of response. I am sure that people in the sector have heard that kind of explanation too often over the months and years. We need to move on this, because the scale of frustration is a matter of concern.

I am concerned about the Scottish Government’s response to some of the key issues. The key issue about Scottish Enterprise and Creative Scotland working together is not about working practices but about supporting the sector, and yet we are told:

“we acknowledge that our communication for the suite of services needs to be improved”.

The response needs to be far more serious than that.

On the issue of the film studio, we might argue about where it will be located, but we are not even at first base on whether it will happen. The Scottish Government’s explanation is dispiriting. People are crying out for a film studio and the Government explains that things are complex and difficult.

I want to make a couple of important points. First, we need to be clear that this is not just a culture issue—it is not just about how we enrich and support artistic talent. It is about how we can benefit economically from a thriving film, TV and video games industry and how, in our budget decisions, we can acknowledge the need to create the infrastructure to support that industry in the way that we support other industries.

We are talking not about subsidising creativity but about rational investment in a sector of huge economic potential, with knock-on effects on the broader economy, including tourism. We are talking about a rational investment to allow Scottish companies to compete.

A recent report suggests that an £11 million investment to secure the “Game of Thrones” series in Northern Ireland resulted in a £491 million economic benefit over four years. That is why we need to up our game. By not acting, we are not simply leaving things as they are; things are deteriorating. We are falling behind Wales and Northern Ireland, and now we see initiatives in places such as Manchester and Yorkshire.

The problem is encapsulated by the issue of the studio. A studio is not just a big space—the lack of infrastructure hampers Scotland. Glasgow won the Commonwealth games not just because it was good at sport but because 70 per cent of the sporting venues were built before the bid went in. The broader facilities that were available—in transport and hotels and so on—were acknowledged. That is why I support a film studio in Glasgow. It would be part of the media village, with room for expansion and a film school. It would fund itself.

We need a can-do approach The people who came before the committee do not want us to pat ourselves on the back. We all care about the issue and must now ensure that the recommendations are acted on and that those voices allow the economy to benefit from a thriving creative film, TV and video games industry.

Photo of Gordon MacDonald Gordon MacDonald Scottish National Party

The arts and creative industries employ 130,000 people and contribute £6.3 billion to the economy of Scotland. The video games industry, which is one of the successful parts of Scotland’s creative industries, produces internationally best-selling games in “Grand Theft Auto” and “Minecraft”. We have ground-breaking university courses at Abertay University and Glasgow Caledonian University. Some of the largest companies in the games industry are located in Dundee and Edinburgh.

However, we need to examine the less-successful areas of the creative arts if we are to continue to grow that part of our economy. The television sector is a combination of public sector broadcasters and independent television production companies that employ 1,700 people in Scotland. In order to grow the television industry here, Scottish producers need to get a larger share of the £100 million that the BBC spends on programmes in Scotland. That is especially important because the budget is due to drop to £87 million in 2017, which means that only one quarter of the of £320 million that is raised in licence fees in Scotland will be spent in Scotland.

In recent years, television production has been increasing, with the BBC reporting that in 2013 nearly 11 per cent of the network budget was spent in Scotland, while Channel 4 was achieving just under 4 per cent spend on Scottish productions. However, witnesses informed us of the difficulties that they had experienced in gaining access to commissioners in London, with no responses to either phone calls or emails requesting meetings to discuss ideas for programmes.

Alan Clements emphasised the importance of getting Scottish ideas back on network television, in high-end drama in particular. He considers that in order to achieve that the industry needs commissioners who are based in Scotland, focusing on increasing Scotland-based production.

If Scottish producers cannot get access to commissioners, how do the public sector broadcasters meet the Ofcom quota? Much of the increase in production in recent years is due to broadcasters’ lift-and-shift policy, whereby production companies temporarily move to Scotland, bring their own film crews, actors, technicians and production staff, and return south when filming is over.

Drew McFarlane of Equity explained that moving a production and actors to a nation or region impacts on local actors’ ability to gain valuable employment and experience. Jane Muirhead of the Producers Alliance for Cinema and Television highlighted that lift and shift frustrates the whole idea of building sustainable businesses because the intellectual property and the revenue remain outwith Scotland.

It is not just BBC funding that the television sector has difficulty accessing. Creative Europe is the European Commission’s new programme to support the cultural, creative and audiovisual sectors, with a budget of nearly €1.5 billion over the 6 years to 2020. ConnectfiIm suggested that it is hard to access the fund because Scotland is defined as being part of the UK, which means that Scotland does not achieve the necessary points that are given for projects from countries that have low audiovisual production capacity.

In order to build a sustainable television sector, we need to emulate the success of the video games industry. The committee has called on the BBC and Channel 4 to abandon their reliance on lift and shift in favour of investing in production by independent TV companies that have permanent bases in Scotland. It also called for an increase in the number of commissioners based in Scotland and engaging effectively with the industry.

With the new powers coming to the Parliament in relation to scrutiny of the BBC, I am sure that members of the Economy, Energy and Tourism Committee will ensure not only that the BBC has met its production and spend quotas for Scotland, but that the impact of its policies on our indigenous TV industry is positive.

Photo of Drew Smith Drew Smith Labour

I am glad of the opportunity to take part in today’s debate and I am grateful to the Economy, Energy and Tourism Committee for its report.

I want to focus on the film and TV industries, as I have been contacted by a number of constituents about their experiences in those industries and their concerns for the future. One person told me that he just did not believe that

“officials realise how important the Scottish film industry is” or the potential that it has.

It may be of interest to members to hear some of the comments that I have heard from my constituents in Glasgow who work in the industry. I hope that those comments will be of value as part of the debate.

“The Scottish film industry is lagging far behind the rest of the UK. There are incredibly talented people here who just cannot get the work and have to travel away from home, not through choice, but necessity to get work suited to their skills.”

“It may seem glamorous, but it is hard to be away from friends and family and your home. Your life is put on pause and it affects the way people relate to each other.”

That individual said that she is not alone in feeling that way, and that she believes that we have a dying industry in Scotland, one of the consequences of which is hostility in the business itself. She said that

“work is so thin on the ground that it breeds distrust in others talking about the few jobs actually coming up. There is no body issuing a list of jobs about to start, so it is all word of mouth. Until a person secures a job, they will not tell anyone else about it for fear of not getting the work themselves. If there was plenty of work around, the right person for the job would be picked and there would be a huge buzz about what was happening.”

Some of the things that I have been told are reflected in the committee’s report—most notably the fact, which other members have mentioned, that there is a lack of understanding and co-ordination between Creative Scotland and Scottish Enterprise, neither of which can claim to have done a good job for the industry. That is not good enough.

I have also heard frustration about the lack of a studio, which we have already discussed. There is irritation and cynicism that something that has been talked about for so long has not happened, but there are also hopes for what could be achieved. What we will need is not just a big empty space to put productions in, but a high-quality facility. Because Scotland is already behind so many of our competitors, our studio facility, if one is to be built, will have to offer something different—something above and beyond what can be achieved elsewhere.

The point has been well made to me that many of the skills in the industry are in and around Glasgow, so I take the view that a facility would be best placed there to maximise its potential. There are few industries of which it can be more accurately said that time equals money. If there is an opposing view about the location, I would be interested to hear what evaluation has been done to contradict the view that Glasgow is where the skills base is and that it has the most potential for growth.

The comments that I have shared are not just a list of complaints about support for the sector. They include insights from people who work in film and TV and are passionate about its success, and I hope that the Government will take them in that spirit.

We heard briefly about the BBC, and I will finish with a comment on that. As Claire Baker is, I am worried that the BBC could be caught between two Governments—one with an agenda to belittle it and another with a desire to break it up. Its future success would be best served by its making more programming in Scotland for network television rather than by seeking to divide limited resources. Scottish content is important, but it should not be seen as the BBC’s sole contribution to Scottish life.

The Deputy Presiding Officer:

You must close, please.

Photo of Drew Smith Drew Smith Labour

In the online age, I am not convinced that talk of another channel is the way to go. However, I can see that you are keen to change the channel, Presiding Officer, so I will desist at that point. [Laughter.]

The Deputy Presiding Officer:

Many thanks. We are very tight for time now.

Photo of Joan McAlpine Joan McAlpine Scottish National Party

I hope that I do not seem too immodest when I say that it was I who, as a committee member, suggested an inquiry into the creative industries. As co-convener of the cross-party group on culture, the subject is close to my heart. However, the success of the report is, of course, down to every member of the committee, our witnesses, our clerks and the Scottish Parliament information centre, which did a particularly good job in supporting us in the inquiry.

I was keen for the committee to hold an inquiry into the creative industries; in the end, we decided to concentrate on the screen industries. It is important that we recognise what a vital sector it is to our economy. It is the same size and has the same number of direct employees as oil and gas.

As the committee’s convener acknowledged, the report is a testament to the Parliament’s committee system and its ability to bring important matters to public and Government attention, and to give Scots a voice in their Parliament to shape Government policy and priorities.

When we embarked on the inquiry, we did not anticipate the debate on the future of the film industry and what it would generate. That emerged entirely as a result of the quality of the written and oral evidence that we heard and the efforts of two extremely impressive and formidable women, who also happen to be leading film producers in Scotland: Arabella Page Croft and Gillian Berrie. I pay tribute to them for their tenacity and the way in which they engaged with the committee. I know that Arabella and Gillian will be disappointed that we still do not have a film studio, which is one of the key recommendations in the report.

However, since the inquiry began, there have been a number of significant announcements, which have been alluded to. I refer in particular to the two new funds that were announced in February, which are worth £3 million; the fund that was announced today; and the Scottish Government’s announcement in May of plans to form an expert group to assist the Government and its agencies to better understand the film industries. That was in direct response to the committee’s recommendation.

Others have talked about this, but I think that it is worth re-emphasising one of the key difficulties that was highlighted by the inquiry—the failure of Scottish Enterprise and Creative Scotland to work well together. The committee made a raft of recommendations. As I have only four minutes, I will quote from recommendation 3, which refers to joint working. It says:

“The separate and distinct remits of Scottish Enterprise and Creative Scotland are acting as a barrier to working cohesively to effectively support the film industry. The Committee recommends that the Scottish Government provides direction to Scottish Enterprise and Creative Scotland to work in partnership in order to support the economic and cultural needs of the film industry, and reviews their performance annually against” specific criteria. In response, the Scottish Government acknowledged that communication between the two agencies needs to improve, and it has set up a number of workshops, as the cabinet secretary mentioned.

On the point that Gavin Brown made, I decided to get my staff to call Creative Scotland today to ask about the progress of the memorandum of understanding. They were told that it is in the action plan and is still being drafted.

I acknowledge the Scottish Government’s role in prioritising the committee’s recommendations. It has shown that it takes the matter very seriously. However, I am not convinced that the two agencies concerned have quite taken on board some of the inquiry’s recommendations in the way that the Scottish Government has. Heads probably need to be knocked together. It was quite clear from the evidence that we took in the committee from the agencies that they just do not get it. I hope that pressure will continue to be put on them to respond to the committee’s report as the Government has, and that we will see a way forward.

Photo of Patrick Harvie Patrick Harvie Green

I add my thanks to my fellow committee members as well as to our clerks, support staff and the many witnesses who gave evidence in person or in writing. I got a lot out of the inquiry and significantly broadened my understanding of the subject. The committee has made a substantial contribution to the debate on the topic.

I had to endure a fair number of wind-ups from my colleague Alison Johnstone, who each week received her weighty papers for the Devolution (Further Powers) Committee that looked at the Scotland Bill, and teased me about the fact that we were off to play games. I thank those from the video games industry who brought some of their products and creations to the Scottish Parliament so that we could get a bit of hands-on experience of what they are doing, creating and contributing to the industry in Scotland. I would like to make a few brief observations in the time that is available.

The film, TV and video games industries are not all the same industry. We can put them under the heading “creative industries”, but the circumstances and needs of TV and film are very different from those of the video games industry. TV and film, by their nature, are rooted somewhere. That is embodied very clearly in the debate about a studio and the sense of weariness that many of the witnesses clearly had after not just years but decades of discussion about whether we can create such a space in Scotland as a place that can attract substantial productions. They have to be rooted in a place.

That applies much less so to the video games industry. It is hypermobile not only because of its technical nature but because of the attitude to life of many of the people who take part in it. If we want it to become a lasting and growing part of the Scottish economy, we will have to find other ways of attracting and keeping it that are much more about the skills, the networks of people and the attitude to life—young people thinking not that we have to be the Seattle of Europe, but instead that Scotland is, on its own terms, a place where people can do that work without aping, echoing or envying somewhere else and something else. The things that we need to do to attract, retain and continue to grow the video games industry will be fundamentally different.

I share the sense of frustration of the TV and film industries. Following Christian Allard’s comment, in retrospect perhaps we should have broadened the scope of the inquiry to include radio, because many of the technical, writing and creativity skills that go into the TV industry find their way in or find a first expression through radio. Therefore, perhaps the scope should have been a wee bit broader.

The circumstances are so different. I share the frustrations about getting a studio. If we can attract more productions on the scale of “Game of Thrones” or the other things that such a space would bring, I will celebrate it just as much as I celebrate Rock Star having an office across the road and everything that it has done.

In all those areas, we also need to celebrate the little—the informal, small-scale self-starter creative who does not necessarily want to be the next “Game of Thrones” or the next Rock Star. Those skills and creative attitudes will be born and fostered in people’s back rooms, bedrooms and coffee bars around the country, where people are working off their own bats and with their own creativity rather than thinking that big is the only way to be.

Photo of Lewis Macdonald Lewis Macdonald Labour

Scotland’s contribution to film and television goes back to their very beginnings, but the truth is that we have failed to maintain that early advantage. Iain Smith of the British Film Commission told the Economy, Energy and Tourism Committee:

“Twenty years ago, Scotland was the biggest production cluster outside of the south-east of England. Now it is probably fourth or fifth.”—[Official Report, Economy, Energy and Tourism Committee, 21 January 2015; c 34.]

It is surely no accident that Scotland’s loss of competitive advantage coincided with the abolition of Scottish Screen—a public body that had the specific remit of promoting opportunities in film and television. It is certainly not by chance that Northern Ireland has moved ahead of Scotland with its own screen agency and relatively greater level of public funding.

Of course, Creative Scotland was set up to replace Scottish Screen but, as Janet Archer herself told the committee, it was set up in a way that has made progress difficult. It has struggled to attract private investment and, as Gavin Brown said, it has even struggled to give a lead to other public bodies working in the same field. The lack of clarity about the relationship between Creative Scotland and the enterprise agencies came up again and again in the evidence in the Economy, Energy and Tourism Committee’s inquiry.

There has since been a major reorganisation of Creative Scotland; the agency believes that it is now in a better place to negotiate and generate the relationships that it needs across the public and private sectors. That optimism is welcome, but the failure to agree a memorandum of understanding on schedule is a concern. There is clearly now quite a lot of catching up to do, which is the responsibility of ministers as well as the agencies.

There is a particular challenge for Creative Scotland to do more to support independent television production in Scotland. During the inquiry, the agency conceded that its film and TV broadcast fund is too small to do much on the television side. Welcome but modest increases in funding are unlikely to change that in any fundamental way. The challenge is to get the most out of other public sector agencies on funding sources to fill that funding gap.

The committee’s inquiry found that there seems to be little flexibility available to Scottish Enterprise to support production companies because of its focus on account managing growth companies. On the other hand, we found that Highlands and Islands Enterprise could do more because of its remit for community development. There is surely a case for looking at how best to join up support for public bodies in skills and production, and to find ways to replicate in other parts of Scotland the effective support that is provided by HIE.

Perhaps most important to stimulating independent television production is the lead that has been given by Ofcom and public service broadcasters in setting and meeting quotas for production outwith London. That has helped, and enterprising companies, including Tern Television in Aberdeen, have been able to produce high-quality programmes for various channels across the wider UK network.

As Claire Baker and other members said, the time has come for the public service broadcasters to go beyond the interim approach of lift and shift and instead to deliver sustained long-term benefit for production companies that have staff based here permanently.

It is also important that commissioners be based here. Those who commission programmes will always start with high-quality producers whose work they already know.

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

The point about commissioning is absolutely vital. I agree that we should provide more independent productions for network television, but we also need commissioning and decision-making here in Scotland. That is the proposal that we will make to the BBC.

Photo of Lewis Macdonald Lewis Macdonald Labour

I welcome the broad principle of that. Commissioning programmes as well as producing them is crucial. If all parties can focus on what public service broadcasters can do for the creative industries in Scotland and for the Scottish economy, that will be the right approach to take when we come to discuss the BBC’s future and other related matters. If we do that, we can make a positive difference to the Scottish economy at this critical time.

Photo of George Adam George Adam Scottish National Party

Although I am not on the Economy, Energy and Tourism Committee, I am aware of the impact that the creative industries have on our economy in terms of jobs and investment, and the ways in which they can be used as a promotional tool for the various parts of our nation. They are a valuable contributor to the economy. As the committee’s convener, Murdo Fraser, has said, the creative industries are worth around £5 billion and currently employ 68,600 people. They can also influence how the world sees us.

Much has been said in the debate about the progress that has been made towards the establishment of a permanent film studio in Scotland. The need for such a studio was articulated by many individuals from the film and television industries the last time that they addressed the Education and Culture Committee. A studio would make a vital difference, considering the new ways of broadcasting TV and film over the various platforms that are now available, including online subscription channels and digital platforms.

“Outlander” has been talked about today as an example of that new approach. In the UK, it is broadcast on Amazon Prime. I have read a bit about “Outlander”. It is a drama series that is based on the historical time travel series of novels by Diana Gabaldon and was created by Ronald D Moore, of “Battlestar Galactica” and “Star Trek” fame. What is not to like about that? I know what I will be watching this weekend. As a fully certified film and TV geek, I cannot wait to see even further progress. We live in exciting times as far as broadcasting is concerned, and there are other opportunities within the industry.

Although progress with the studio is at an early stage, I can say that there is no better place for a film studio than the great town of Paisley. The creative talent is there, our geography is perfect for it, and the town has the domestic and international transport links that are required by such a studio.

Film and television can influence the way in which the world looks at us, our towns and our communities. For once, I would like to use my constituency as an example. Television and movies have had an influence on my community. A number of years ago a movie was made about the stone of destiny and Ian Hamilton—a Paisley man, incidentally—who reclaimed it in the 1950s. It was filmed at Paisley abbey in Paisley—well, obviously it is in Paisley—which stood in for Westminster abbey. That showed that we can use the historic buildings and infrastructure that we have in towns such as Paisley for that purpose, and has led to many TV production companies coming to the town.

The BBC has various on-going antique shows that travel the length and breadth of the country. One is “Flog it!”, which my wife was in. I am actually sick of hearing about that show, because it is broadcast throughout the world and family members across the world tell us about it constantly, as if it just happened yesterday instead of about five years ago. However, that shows us the impact of even a TV show such as that.

With regard to the different ways in which things are done in TV now, it is interesting to note that STV Productions produces a similar show for the BBC, called “Antiques Road Trip”, which has visited Paisley on numerous occasions because the production company recognises the history of the town and what is available there.

I welcome the report and acknowledge the hard work that has been done by the committee. We live in exciting times and now is the time for Scotland to reassert itself as a broadcasting and film-making nation.

Photo of Gavin Brown Gavin Brown Conservative

This has been an interesting debate. I particularly enjoyed the uplifting contribution from Mr Adam—a man who I have to say never disappoints.

In closing for the Conservative Party, I will pick up on the points that I want the Government to focus on in the coming months. It is not activity that is important but action on the ground and the ability to make a real difference.

I welcome the fact that the Government agrees that there should be a review of the video games sector, to be led by Creative Scotland. That was a conclusion of the committee that the Government signed up to, and I was pleased to hear the cabinet secretary say that the review will begin shortly. If she has time to address the matter in her closing speech—if not, perhaps she could put something in writing—I would be interested to hear when it is going to begin and a rough timescale for it. Given the nature of the industry, it must happen quickly. The industry changes regularly, and a typical industry review that might take a year or two would not be appropriate. I will give members a notion of the sort of changes that happen in the industry. According to Scottish Government figures, there were 200 employees in the industry in 2010 but 1,000 in 2013. That is a fivefold increase over a three-year period. It is an industry that is going places—with the right strategy, it could really go places.

I ask the Government to keep an open mind about the results of the review when it takes place, particularly regarding a national strategy. The committee suggested that there ought to be a national strategy for the industry, and although the Government did not dismiss the idea it seemed a little lukewarm about it and certainly did not commit to it in the written response that I saw. I urge the Government to revisit the proposal once the review has taken place and to pull together a national strategy. There is a digital leadership group of which the video games industry is a part, but, given the growth that we have seen over the past couple of years, it merits a national strategy of its own. However, let us see what the review turns up.

I do not know whether this is true—I hope that it is wrong, although it appeared to go unchallenged—but the statement is made in the report that there is no strategy for growing the television sector in Creative Scotland’s 10-year strategic plan. I would like the cabinet secretary to respond to that. If it is true, change needs to happen. The statement appeared to go unchallenged, but I may well be wrong about that.

I have talked about the memorandum of understanding, so I will say no more about that except that it is a priority not just for its own sake but because of the signal that it sends out to industry. If we cannot get that right, we will not see the cultural changes that we need across the organisations that are responsible for it.

We heard from the cabinet secretary about the £3 million of funding that was announced some seven or eight months ago, of which £2 million was a loan fund for production companies and £1 million was for the screen skills fund Scotland. It would be interesting to know what draw-down there has been of that £3 million. Are we in a better place, where that money is being put to good use, or do we face some of the same challenges that we faced with the previous £2 million fund?

It is for the members of the committee to decide their work programme going forward, but I make a plea to them that, having done all this excellent work and having pulled together a good report, they should have a follow-up session, perhaps towards the end of the year or early next year, at which they get the same witnesses back and check on the progress that has been made so that we do not have a similar debate in a year’s time or two years’ time in which we talk about similar challenges to those that we have heard about today.

Photo of Anne McTaggart Anne McTaggart Labour

We welcome a number of the recommendations that are made in the report, including the recommendation that Creative Scotland lead the co-ordination of the industry, academia and public bodies to establish a national strategy that will deliver a sustainable Scottish games industry. We also welcome the funding commitments that were made today in advance of the debate. However, the report’s finding that there is an apparent lack of ability among agencies to collaborate or work within the industry is rather concerning for many members. The “separate and distinct remits”—to quote the report—of Scottish Enterprise and Creative Scotland act as barriers to cohesive working to effectively support the film industry, which is detrimental to Scotland’s culture.

As has been outlined in the report and in the debate, it is vital that a decision on the establishment of a film and TV studio in Scotland is reached as soon as possible, otherwise our film and TV industries will be damaged. We agree with the Scottish Government, its agencies and the film and TV industries that such a studio is a priority for growing the sector, and as a Glasgow MSP I believe that Glasgow would be best placed to accommodate it—I will go no further than that.

Claire Baker and Gordon MacDonald referred in their speeches to the Ofcom quotas for more production and greater spend in Scotland by public service broadcasters. That presents a huge opportunity to increase skills and expertise in Scotland’s independent TV industry. We welcome the Economy, Energy and Tourism Committee’s call on the BBC and Channel 4 to adopt that as a new approach to commissioning by the end of 2016, if not sooner.

It is important to note that, following the Smith commission, we will have a consultative role for the first time in the charter renewal process for the BBC, and it is vital that we work constructively across the parties to get the best deal for viewers in Scotland. The Scottish Labour Party is committed to calling for increased investment for BBC Scotland from within the licence fee settlement and for the retention of the quota system for commissioning from nations and regions.

There is no doubt that the creative industries bring valuable economic benefits to individuals, communities and the country as a whole. Scotland’s cultural and creative activities are as relevant to our international reputation, economic prosperity and trade and investment agenda as direct business support and the promotion of exports. It is vital that all the agencies in the creative industries work collaboratively to achieve greater results and get the best results for Scotland’s people. We are open to working with the Scottish Government on providing better support to meet the needs of individuals and companies in the creative sector.

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

I thank members for their contributions to the debate. I will address a number of specific areas in my speech, and I will follow up on those that I cannot address. I am committed to returning with updates to the Economy, Energy and Tourism Committee, because I think that what we are dealing with is a moveable feast and that there will be developments. It is right for the committee to hold the Government and, indeed, the creative agencies to account.

On areas of key concern, the film studio is still under negotiation in the film industry leadership group’s discussions with the private sector developer. There were five bids from the private sector after the private sector tendering request was put out, but only three were eligible. Two bids were fully public sector-funded approaches, but we cannot provide 100 per cent public sector funding support for the studio.

Photo of Claire Baker Claire Baker Labour

The film studio proposals are quite a complicated picture to understand. There was a proposal in May from a private investor for a studio in the Pentlands area. How does the cabinet secretary see that type of activity fitting with the idea of a Government-supported studio?

Photo of Fiona Hyslop Fiona Hyslop Scottish National Party

The exercise that was carried out was a call for a private sector proposal. I am quite happy to write to the members contributing to the debate to give them an update on where we are and on the process to date. The discussions with the private sector developer are continuing but, for reasons of confidentiality, I cannot give members full details in terms of who, where and when.

However, we are on the case in terms of making sure that we have that studio, because everybody is very clear that we need the infrastructure. We have locations that the industry can use—for example, “Knights of the Roundtable: King Arthur” was filmed here earlier this year. One of the productions taking place here is “Outlander”, whose scale of production and economic impact is comparable with that of “Game of Thrones” in the early years.

Of the £3 million fund that we announced, £1 million is for skills development. We will announce very soon where that skills funding is going. Loans will become more advantageous because of UK tax changes. The £2 million loan fund was created precisely as a response to the producers Joan McAlpine talked about, who came to a meeting with me and John Swinney; the loan fund came out of one of the suggestions at that meeting. There has been some draw-down from the fund, but the draw-down clearly depends on what projects there are. However, we are moving, particularly with the tax changes, into an obvious area for the use of that fund.

The £1.75 million production fund that I announced today will also provide incentives for people to draw down in other areas, whether that be loans, or skills funding, as some of the financial packages can be quite complex from the industry’s perspective.

The point about the sustainability of the screen sector is important. We need to think carefully about what we mean by public service broadcasting. In addition, if we are to have successful public service broadcasting, it is important that we have indigenous companies that are able to benefit from that, too.

On the creative industries more generally, I will pick up Patrick Harvie’s point. At the micro level, it is important to support the entrepreneurial start-ups, and it is pretty clear that the video games industry is fast moving. Indeed, people move from company to company very quickly. That explains the reticence on writing a strategy. The video games sector told me that if it were to spend time on a strategy, it would be out of date by the time it was written because the sector moves so quickly. Therefore, although working with the sector to review what is needed is important, acting promptly will be key.

I will now focus on an area that has not been touched on but which will become increasingly important: the digital single market. It may even be important for the committee to look at that area and its implications because the digital single market strategy will affect the creative industries and the wider sector. In May, I attended the Education, Youth, Culture and Sports Council in Brussels, where I represented the UK during the policy debate on the European Union digital single market strategy and the audiovisual media services directive. It is important that we ensure that the interests of Scotland’s creative industries are represented in the EU proposals on that in the coming months and years. I will work with the UK Government to ensure that its consultation processes on the digital single market include the creative industries.

I have mentioned the issues around games, the sustainability of television and the importance of having a different package of activity for film. However, it is important that I address the underlying point: how will Creative Scotland and Scottish Enterprise work together? It is clear from Lewis Macdonald’s questions that the issue is not new. It was originally proposed under the previous Administration that Scottish Screen should be merged with the Scottish Arts Council. Working together creates challenges, but why is it that in other sectors, such as the life sciences sector, in which those involved must work with the private sector, the health service and Scottish Enterprise, solutions can be brought to bear?

I place the challenge back on Patrick Harvie: just because the creative industries are diverse does not mean that we should not and cannot have dedicated and focused support similar to what the other key sectors have. That expectation comes through clearly from the committee’s report; it is also this Government’s expectation. The Deputy First Minister and I are clear that we expect the two public agencies, Creative Scotland and Scottish Enterprise, to provide services to the sector, not to each other. We expect that their changes to how they go about things will produce results, and we expect them to be informed by the workshops that have been taking place over the summer in the sector.

I am excited for the sector. There are possibilities. As Drew Smith mentioned, there is cynicism. There is also opportunity, which is what I see for the sector. I hope that the opportunities will, in the near future, outweigh the cynicism.

The Deputy Presiding Officer:

I call Dennis Robertson to wind up the debate on behalf of the Economy, Energy and Tourism Committee. You have until 5 o’clock, which is exactly six minutes and 20 seconds away.

Photo of Dennis Robertson Dennis Robertson Scottish National Party

The clock is ticking. It gives me great pleasure to wind up the debate. I will focus on the cabinet secretary’s comments towards the end of her speech.

There is excitement in the sector, but there is also frustration. Throughout the debate and from the witnesses we heard from in committee there was hope, excitement and ambition for the industry. When I listened to Patrick Harvie, I was thinking, “My goodness, Patrick—your energy in the debate is fantastic.” That energy was also evident in the committee when we took evidence. However, as Joan McAlpine and Johann Lamont said, there was anger and disappointment at the same time.

In looking at where we are, we knew to some extent what the challenges were. I certainly went into the inquiry not knowing what the outcomes would be. Did I understand the industry? Did I understand the complexities around it? No, I did not. I certainly learnt a lot during the committee’s evidence taking.

I thank the clerks and the witnesses for the work that they put into the report. Murdo Fraser started by quoting Gandhi. I think that he was perhaps being a little tongue in cheek—a little flippant—as he can be, even as convener of the committee. As a committee we set ourselves a task not to build up the success of the Government but to analyse in depth where we are and, hopefully, the direction that we are going in.

However, there is no doubt—I do not think that anyone is shying away from the fact—that Creative Scotland and Scottish Enterprise have not been working together as collaboratively as they could have been. I am delighted to hear that workshops have taken place. There is perhaps some regret about the fact that we have not reached a final outcome there. When the cabinet secretary and the Deputy First Minister were at the committee, there was no doubt that they were looking to both those public agencies to work together for the good of and to the betterment of the industry as a whole.

We looked at film, TV and video games. Those are three distinct areas, although as Patrick Harvie rightly said, we could probably take film and television together to some extent.

What is the stumbling point for us? It is the film studio. What is another stumbling point? It is the location of the film studio. Lewis Macdonald talked about the success of Northern Ireland and its film studio, and of studios in Wales, but he forgot to mention state aid. The committee acknowledged clearly the problems of establishing the film studio, given the rules that create the barrier. The word “barrier” has been used a few times during today’s debate. Barriers should not be an obstacle. Barriers—if we acknowledge that they exist—should be an opportunity for change. That is probably the direction that we are going in.

I was taken by the fact that Christian Allard—inventive as he always is—started to talk up the north-east, and Dundee in particular, for the location of a film studio. Then we heard George Adam saying, “No, it should be in Paisley”, which just shows that comedy is still alive in this industry. In saying that, Edinburgh is home to the fringe. However, Glasgow makes the point. I am certainly not going to pre-empt or pre-judge the location of a film studio, when it eventually arrives. As Johann Lamont said, if we can have the Commonwealth games in Glasgow, why can we not have the film studio, given that we have the infrastructure? I am sure that there will be many other bids.

I was delighted that the cabinet secretary took the time to visit Aberdeen. Lewis Macdonald mentioned Tern TV, which the cabinet secretary visited in Aberdeen to see for herself the work that goes on in the independent sector. I sincerely hope that she came away impressed by the work that was being produced by Tern TV. I think that that shows that we have the skill, ambition and talent here in Scotland, although there is much to be done.

We have talked about commissioning. We certainly need to see commissioning changing, and commissioning and production coming to Scotland. Given the public consultation that is out there and the opportunities that are before us in the programme for government, I sincerely hope that Scotland can lead the way when it comes to the future of broadcasting and that the people of Scotland can take the opportunity to take the lead.

When we took evidence, I was criticised to some extent for not having participated in video gaming. I always find using certain technologies for gaming to be arduous and difficult, but they are maybe not impossible to use. Perhaps I should commit to trying to get into some of the games that are available to me.

Patrick Harvie said that people from the industries came into the Parliament and demonstrated what they have and where they are going. We have an amazing abundance of talent, ambition and skill, but the industries need that extra lift. They need help from the business gateway and the colleges. They need the infrastructure to bring everything together. They cannot be left out there in limbo.

The Economy, Energy and Tourism Committee looks forward to receiving the update that we asked for from the Scottish Government at the end of the year. I am sure that we will return to this debate.