Production Biz Goes From Bad To Worse

Film producers in the U.K. have never had it so bad.

Their six-year run of ill luck started with the abolition of the Eady Levy (which took money from the exhibitors and put it straight into the producers’ pockets) in 1985. It continued with the withdrawal of capital allowances in 1986, the morale-sapping collapse of Goldcrest in the same year and 1989’s unhelpful adjustments to the ITV exchequer levy.

Then last year came the merger of the filmmaker’s friend British Satellite Broadcasting with Sky Television. The end result has been low levels of indigenous film production.

At the same time, the weakness of the dollar against the pound and massive increases in U.K. production costs in the mid-’80s have combined to reduce U.K.-based production activity of the U.S. majors to a minimum.

Because the downturn has been so deep and of such long duration, many observers fear for the welfare not just of various companies or studios, but of British filmmaking as a whole. If there isn’t an upturn soon, the pundits predict, the industry’s infrastructure will begin to unravel. Once that process starts it could be hard to stop, and films could go too far down to get back up.

In this context, it matters little that the golden opportunity of the European single market beckons. Markets are there to be exploited by the strongest players, and there are others – the Americans and subsidized Europeans in particular – who are much better placed than the Brits.

The example of motorcycles is instructive: The British motorcycle industry collapsed in the midst of a massive boom in worldwide demand for motorcycles – a boom that was exploited almost exclusively by the Japanese.

Some point to the four-walling of Pinewood and the dismemberment of Britain’s oldest film studio, Elstree (founded in 1926 and home in recent years to the Indiana Jones and Star Wars series), as evidence that the unraveling process has already started. The disarray noticeable among studio facilities and equipment suppliers and the high anxiety prevalent among post-production houses also support the doomsters’ view.

Perhaps the most persuasive evidence that matters have become critical is the willingness of the technicians’ union, ACTT, to make across-the-board concessions in talks on a new production agreement with the employers’ organizations. ACTT’s attitude reverses four decades of tough talk, during which time it has wrested ever-better terms for its members. The union knows full well that however good the agreed terms and conditions of employment, they are meaningless if there is no work.

It is in this spirit that ACTT, the actors’ union Equity and the production workers’ union BETA have agreed to participate in the British Film Partnership, a radical plan for reducing the costs of low-budget productions by as much as 30%. Under BFP rules, union members work for standard rates without overtime and agree to flexible working arrangements (including the blurring of formerly hallowed demarcation lines) in exchange for participation, alongside the financiers, in the revenues accruing to the film over and above its direct cost of production.

Only one BFP film, “Dakota Road,” has gone into production so far, but the experiment was by and large a success and is expected to be repeated. But the BFP scheme is only applicable for films at the very lowest end of the budget spectrum (around £ 1 million). It does not provide a way out for the medium-budget films which are the staple of U.K. production companies, nor for the big-budget productions on which the studios depend for their survival.

For these more expensive films, all eyes are focused on three areas of development which are filled with as much uncertainty as promise:

* The deliberations of the working parties which, under the auspices of the Treasury and the Department of Trade and Industry, are looking into ways of making U.K. film investment more attractive.

* The outcome of the upheaval in broadcasting that will attend the Channel 3 franchise auction.

* The implementation of a five-year program for European film and television production and distribution. The $250 million funding for the program was recently firmed by the Economic Community council of ministers in Rome.

Hopes are high for a tax plan for film production that will attract non-industry investors. The problem will be to get approval for such a scheme from the Treasury and from Parliament, which is likely to debate the issue as part of budget discussions in April.

In a similarly optimistic spirit, production companies are filling out application forms for development and production grants from the EC, while distributors are queuing up for assistance with the marketing of European pictures within the community.

But perhaps the area of change that is likely to have the most far-reaching consequences for U.K. film production is, paradoxically, television, despite the current withdrawal from film production by the ITV companies in preparation for the upcoming franchise auctions.

There is a growing body of opinion that the British film industry may never again stand on its own feet. Essentially entrepreneurial and risky, yet lacking the critical mass to withstand its inevitable failures and mistakes, the film business, so the argument goes, needs to align itself with a more structured and securely capitalized business. In the U.S., the studios have film and video distribution to fall back on. In the U.K., the filmmakers’ only equivalent option is television.

The belief is that either the independent production companies that supply the new Channel 3 network will become big enough to embrace film production (partially financed by tv), or that the Channel 3 broadcasters will invest in films.

The attraction of film for broadcasters and producers is its salability in the world markets and in the secondary television markets that are likely to arise in Europe in the coming years.

The U.K. production community needs more than anything a hit, or even better, a succession of hits. It was just such a bonanza, led by such films as “Gandhi,” “Chariots Of Fire” and “The Killing Fields,” that set Goldcrest on its short road to riches in the early ’80s.

More News

  • Jeff Flake Donald Trump

    Jeff Flake Blasts Trump for Attacks on the News Media

    Film producers in the U.K. have never had it so bad. Their six-year run of ill luck started with the abolition of the Eady Levy (which took money from the exhibitors and put it straight into the producers’ pockets) in 1985. It continued with the withdrawal of capital allowances in 1986, the morale-sapping collapse of […]

  • Kevin Spacey

    Scotland Yard Investigating Third Sexual Assault Complaint Against Kevin Spacey

    Film producers in the U.K. have never had it so bad. Their six-year run of ill luck started with the abolition of the Eady Levy (which took money from the exhibitors and put it straight into the producers’ pockets) in 1985. It continued with the withdrawal of capital allowances in 1986, the morale-sapping collapse of […]

  • Bon Jovi Howard Stern

    Howard Stern to Induct Bon Jovi Into Rock and Roll Hall of Fame

    Film producers in the U.K. have never had it so bad. Their six-year run of ill luck started with the abolition of the Eady Levy (which took money from the exhibitors and put it straight into the producers’ pockets) in 1985. It continued with the withdrawal of capital allowances in 1986, the morale-sapping collapse of […]

  • The Blacklist 100th Episode

    'The Blacklist' Team on the 100th Episode: A Heist and a Walk Down Memory Lane

    Film producers in the U.K. have never had it so bad. Their six-year run of ill luck started with the abolition of the Eady Levy (which took money from the exhibitors and put it straight into the producers’ pockets) in 1985. It continued with the withdrawal of capital allowances in 1986, the morale-sapping collapse of […]

  • Elvis Presley

    Sundance: Oscilloscope Buys Elvis Presley Documentary 'The King'

    Film producers in the U.K. have never had it so bad. Their six-year run of ill luck started with the abolition of the Eady Levy (which took money from the exhibitors and put it straight into the producers’ pockets) in 1985. It continued with the withdrawal of capital allowances in 1986, the morale-sapping collapse of […]

More From Our Brands

Access exclusive content