BRO0027

 

Further written evidence submitted by TAC

 

I would like to thank you again for asking TAC to appear before your Committee on 7 June as part of your inquiry on Broadcasting in Wales.

 

At the session I promised to follow up on some of the matters discussed, which are covered below.

 

Ofcom Out-of-London Production Guidance

 

  1. Wales has many ‘home-grown’ independent production companies, including both Cwmni Da and Yeti, alongside whom I gave evidence to the Committee.  Such companies are set up by local production and business talent, with their HQ in the nation and which employ locally and spend in their communities.

 

  1. However there are also productions qualifying as outside the M25 which are made by often-temporary subsidiaries of London-based companies. These businesses tend to employ a lot of talent from outside Wales to work on productions made in the nation. They are also more likely to spend on post-production and other services outside Wales.  Profits are returned back to London-based companies rather than adding to the economy in Wales. The identity of specific companies is not the issue for our members. We accept any company taking part in such practices is working with broadcasters and both are acting within the Ofcom guidance.

 

  1. Ofcom currently sets out-of-London PSB TV production quota requirements. It draws up guidance[1] which defines which productions can qualify as ‘made outside the M25 area’, in order to meet the requirements in Sections 286 and 288 of the Communications Act 2003. It last consulted on this guidance in 2018-19 and at the time TAC expressed concerns that the guidance may not be stringent enough.

 

  1. As I said at the session, there are currently three different criteria, two of which need to be met for a production to qualify as ‘Out-of-London’ or beyond that as specifically produced in Wales. In brief these are as follows (the full definitions can be found in Ofcom’s guidance):

 

a)      The production company must have a substantive business and production base in the UK outside the M25. The production in question must be managed from that substantive base.

b)      At least 70% of the production spend must be spent in the UK outside the M25. For the purposes - production spend should be based on the entire production expenditure, including any funding from third parties and spend outside the UK, but should exclude the cost of on-screen talent, archive material, sports rights, competition prize-money, copyright costs and any production fee.

c)      At least 50% of the production talent (i.e. not on-screen talent) by cost must have their usual place of employment in the UK outside the M25.

 

  1. From an initial examination of productions which qualify as being ‘Wales’ productions included in the most recent Ofcom register[2], it does appear to us that the total number of commissions to companies with HQ’s outside of Wales (including PSB in-house production), is higher than the number of commissions to ‘home-grown’ companies in Wales.

 

  1. We estimate that of 71 productions qualifying as being ‘Wales’-made, 30 were commissioned from home-grown companies and 41 from those with HQ’s elsewhere. Again while these productions might meet the guidance, there is a loss to the Wales economy and long-term benefit of companies with HQs elsewhere being commissioned so regularly. TAC would like to see more information and transparency on the value of each commission (including returning series), in order to better understand the financial impact of this on the Welsh economy.

 

  1. TAC regularly discusses this issue with Ofcom. As a trade body we will continue to discuss whether there is a way of, firstly, tightening up the guidance to have better transparency on the investment in Wales and its creative industries and, secondly, to ascertain the level of scrutiny which is applied to how companies meet these criteria and whether this might point to the need to, again, adjust the guidance.

 

  1. Also the register takes some time to appear, with the latest being published in 2022 but covering the calendar year 2021. We think that it would help transparency and a more current overview if a more up-to-date register of Out-of-London productions was published online by Ofcom.

 

 

Channel 4 and the Media Bill

 

  1. The sector welcomed the UK Government’s decision not to privatise Channel 4.  However there is great concern at the Draft Media Bill provision which revokes the legislation prohibiting Channel 4 from making its own programmes (Section 295 of the Communications Act 2003). Up until now, Channel 4’s status as a ‘publisher-broadcaster’, commissioning all of its content from the UK independent sector, has been important to the sector’s growth, including in Wales.

 

  1. While the UK Government plans protections, including a higher Independent Production Quota for Channel 4 than the other PSBs, this will need careful consultation with the industry.

 

  1. In addition it needs to be clearly written into the Bill that Channel 4 should still be a major investor in the independent sector. TAC is therefore calling for a replacement wording which requires Channel 4 to commission a ‘significant’ amount of programmes from the independent sector.

 

  1. Recently Channel 4 has been committed to 50% content spend outside London, above its official requirement of 35%. It should be required to meet this on an ongoing basis, by having it added to the draft Media Bill as a requirement.

 

 

Apprenticeships

 

  1. ScreenSkills has published projections of major skills shortages by 2025. There is a role for many different agencies to play in addressing this and in Wales we are working to ensure that is well co-ordinated as possible.

 

  1. TAC partners with S4C on an industry training programme, which since 2019 has been responsible for 97 courses with 1,423 registrations.

 

  1. TAC is also working in partnership with organisations that have been awarded funding from Creative Wales’ Creative Skills Fund. TAC has been working with Cult Cymru, which has been awarded a second round of funding for its Wellbeing Facilitator Scheme, also TAC is supporting the National Film and Television School’s Business and Leadership Programme.

 

  1. There are apprenticeship schemes in place in Wales, including some year-long schemes. Sgil Cymru has been recruiting for 12-month apprenticeships through their CRIW Apprenticeship Scheme:

 

 

  1. The Committee has heard from others, including Netflix and Coba, why the current UK Government apprenticeship programme is not entirely suitable for the TV Production sector, due to that sector having a large freelance base which makes it problematic to take people on a scheme for as long as a year.

 

  1. We note that the House of Lords Communications and Digital Committee’s report into the Creative industries said the flexi-job apprenticeship schemes which had been piloted by the UK Government needed to be promoted more widely and would agree that this is important.

 

 

23 June 2023


[1] https://www.ofcom.org.uk/__data/assets/pdf_file/0017/152450/regional-production-and-regional-programme-guidance-from-2021.pdf

 

[2] https://www.ofcom.org.uk/__data/assets/pdf_file/0022/242815/mol-register-2021.pdf