On Wednesday, Chancellor Jeremy Hunt will make a statement in the House of Commons revealing the details of the UK Government’s Spring Budget.
On the same day, across the city, I’ll be taking part in the opening day of the Big Creative UK Summit – our annual flagship gathering, centred on exploring ideas that will shape our future.
These events, though obviously unrelated, have one major thing in common: both must focus on the enormous economic growth potential of the creative sectors – and explore ways this can be supercharged.
In the two short years after the pandemic – against a backdrop of widespread economic instability – the GVA of the Creative Industries has grown by over 15% to £125bn in 2022. We employ over 2.3 million people. The Chancellor himself calls us a growth engine.
Despite all this, we are undercapitalised. And that needs to change.
When we met with HM Treasury last month, we went in with one overarching ask: for the UK Government to match the levels of investment, support and infrastructure provided to other key growth sectors.
Here are ten requests we put on the table to make steps towards that:
1. HM Treasury need to build a complete data set of the entire investment landscape. This should include commissioning research that consolidates public, private and philanthropic spend.
This piece of work will allow everyone to see opportunities for future investment – and identify areas in which greater private investment will be realised. Think of it as a treasure map to funding – but one which will lead us to even greater returns in the future.
2. We’re calling on the Chancellor to reform R&D tax relief. The UK should broaden the definition to include arts, culture, humanities and social sciences (the internationally recognised OECD Frascati definition), alongside the current review of R&D spend within the sector.
3. We’re proposing the launch of a new institution in the shape of a Creativity Bank. This is not a traditional bank. Rather, it would be place for creative organisations to find money, tailored business support, advice and further routes to funding. It would be a way to ensure the right type of money is available for the right stage creative organisations, with a patient approach to long-term growth.
4. Review the ‘Studio Tax’. The UK has recently seen a slowdown in film and TV production. One of the contributing factors to this is the ‘Studio Tax’ – levied by HMRC’s Valuation Office Agency. We’re calling on the Treasury to urgently review this, in the wake of concerning studio closures.
5. Revise the 80% core expenditure cap to support VFX. The cap has a particularly negative impact on VFX work, as this part of the production process can be transferred to another territory, where further tax incentives can be claimed.
6. Remove sunset clauses on Orchestra and Museums and Galleries tax relief. As of yet, there is no permanent extension to the sunset clauses for Museums and Galleries Tax Relief (due to expire in 2026). We are calling for this to be made permanent.
7. Maintain Theatre Tax Relief. We welcome the positive amendments and clarity on Theatre Tax Relief (TTR) – and have seen the positive impact it’s having on the sector. We want to see TTR implemented indefinitely, with the higher rate of 50/45% maintained in perpetuity.
8. Apply Business Rate Relief to all cultural sites – including venues, concert halls, hubs and creative spaces.
9. Reform the Apprenticeship Levy in England. There needs to be a sector-first approach, which allows funding to be used for industry-run courses and qualifications.
10. Deliver the £270m Arts Premium that was promised in the 2019 Conservative Party Manifesto. This would provide a much-needed boost to music and sports – and provide pathways into creative careers.
Following on from the news that the UK officially fell into recession last year, the priority for the Chancellor must be to invest in growth.
That means investing in the Cultural and Creative Industries, and allowing us truly fulfil our potential for the UK.
