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Keeping animation on our shores

November 2, 2011

Keeping animation on our shores

My constituency contains in Soho and the West End the spiritual home of Britain’s globally competitive creative sector. Creative industries offer one of the great white hopes for economic growth but all is not well for some of its players.

Two years ago I was contacted by Oli Hyatt of Blue Zoo, an animation company with offices within the constituency, as he was deeply concerned about the future of the UK animation industry. Oli has since been tireless in his campaign to keep animation work on these shores and he helped set up Animation UK in a bid to get government to wake up to the industry’s problems. As Patron of Animation UK, I have been helping make the case to government for a tax credit to support the industry.

In terms of quality, humour and inventiveness, the British animation industry is second to none. Past success in this field has been such that characters like Aardman’s Wallace and Gromit have become part of our national heritage. They are also adored worldwide, acting as ambassadors that embody the spirit of our nation.

But many of our family favourites have moved abroad to be animated by foreign production companies. Why?

Cheaper overseas labour provides part of the answer. But bigger than that have been the huge funding incentives in terms of tax breaks and creative funds in other countries that make it nearly impossible for UK companies to compete. Now nearly every nation in the world with an animation industry is offering government-backed incentives to attract animation work.

Put simply, there is no level playing field. Price and product have become secondary to cashflow. The corollary is that animators can waste years putting together funding packages in the UK before often having to resort to co-production with a business operating outside the country, losing a significant proportion of IP rights in the process.

Combine that with a massive reduction in children’s broadcasting and a drop in the prices for programming because of the junk food advertising ban, and we are left to rely solely on the UK’s edge in talent to keep the animation industry afloat.

Yet if we allow this industry to be eroded, we could face an exodus of opportunity from our shores. Skilled young talent may be driven abroad; we could lose the chance to exploit highly lucrative ancillary licensed products; we may see the leaching of expertise, creating a skills dearth in complementary industries such as post-production; and we risk undermining our cultural heritage. Indeed it is precisely because of the vast opportunities that flow from a thriving animation sector that other nations are so keen to attract the business.

The government has a unique opportunity to support the animation industry at this critical juncture in its history. I have been working with dynamic industry players on this issue for over two years now, and have been consistently taken aback by their passion and drive. In producing a comprehensive report, Securing the Future of UK Animation, Animation UK has provided us with a physical expression of that passion and proved via a conservative estimate that assistance in this area could lead to a net gain for HM Treasury.

Our animators have never wanted handouts. They are confident that they have the skill, flair and ideas to attract work. Nor do they argue against the free market. The problem lies in the fact that at the moment the market is far from free.

The government has been consistent in espousing its support for the creative industries. Here is an opportunity to turn a sympathetic ear into a lasting difference for British animators. I strongly believe that the introduction of a tax credit would act as a palpable demonstration of our government’s support for the creative industries and commitment to economic growth.