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Home , British Film Institute, Film4, Film4 Productions, The Grand Tour

Written evidence submitted by the

The Future of Public Service Broadcasting DCMS Committee response, June 2020

About the BFI The BFI is the UK’s lead organisation for film, television and the moving image, an Arm’s Length Body of UK Government and a distributor of National Lottery funding. As an organisation it works to promote these media in a number of ways:

- Curating and presenting the greatest international public programme of world cinema for audiences; in cinemas, at festivals and online - Caring for the BFI National Archive – the most significant film and television archive in the world - Actively seeking out and supports the next generation of filmmakers - Acting as industry’s representative to Government, helping to make the UK the most creatively exciting and prosperous place to make film internationally.

Founded in 1933, the BFI is a registered charity governed by Royal Charter. The BFI Board of Governors is chaired by Josh Berger CBE.

About this submission The following document responds to questions set about by the DCMS Committee as part of its inquiry into the future of Public Service Broadcasting. Given the many common objectives held by the BFI and Public Service Broadcasters, the response focuses predominantly on the Committee’s questions around cultural, economic and societal impacts of public service broadcasting. However, where sections relate explicitly to another of the Committee’s questions, this is underlined.

The BFI is happy to provide further information on any of the issues raised as required by the Committee.

INTRODUCTION

The term ‘public service broadcasting’ is still as relevant as ever, even as services adapt to the digital age.

The BFI shares a number of common objectives with Public Service Broadcasters, with both playing a critical role in fostering film, television and the moving image across the UK. The BFI’s Royal Charter sets out a mandate to do so in a number of ways:

- by promoting their use as a record of contemporary life and manners

- by promoting education about film, television and the moving image generally, and their impact on society - by promoting access to and appreciation of the widest possible range of British and world cinema - by establishing, caring for and developing collections reflecting the UK’s moving image history and heritage

The BFI sets out how it will achieve this in its current five-year strategy, BFI2022, which makes clear that its priority in delivering each strand of this work is to make UK screen culture as inclusive as possible.

Public Service Broadcasting supports each of these objectives through the range of content and services it provides for the UK public, including the BBC’s and ’s support of independent UK film through BBC Films and respectively.

1. ACCESSIBILITY OF SERVICES

The sheer accessibility of PSB services is central to their public value, connecting with a wider range of people than any other UK broadcast service. The Lords’ Communications Committee report, Public Service Broadcasting: As Vital as Ever, concluded that “an essential feature of public service broadcasting is its universality, free at the point of use after paying the licence fee: both the availability and affordability of public service broadcasters are unmatched by other services.”1

Changes to the PSB model could affect the accessibility of services.The BFI previously submitted evidence to the DCMS Committee’s inquiry into decriminalisation of the licence fee setting out a range of evidence demonstrating that the current funding model delivers value for money for customers and that this may be damaged by any change - in particular decriminalisation of non-payment of the licence fee.2 It is essential that any change to the license fee model model does not impact accessibility or affordability.

A switch to a wholly internet-based service could also impact accessibility. Research by demonstrates that the number of people using the internet continues to increase, with 87% of adults using the internet in 2019, but this proportion is lower among older people (81% for 55-64s, 33% for 65- 74s and 48% for those aged 75+) as well as those from lower socioeconomic backgrounds (working-age adults in DE socio-economic group1 households are more than three times as likely as those in non-DE households to be non-users of the internet).3 While viewing habits continue to evolve, a premature move to online-only services risks isolating some of society’s most vulnerable. Government should provide a range of conclusive evidence that such a move will not marginalise these groups before any such move is confirmed.

THE CULTURAL IMPACT OF PUBLIC SERVICE BROADCASTING

1 https://publications.parliament.uk/pa/ld201919/ldselect/ldcomuni/16/1602.htm 2 This submission is available upon request 3 Ofcom, Online Nation: 2019 Report, https://www.ofcom.org.uk/__data/assets/pdf_file/0024/149253/online-nation-summary.pdf

Both the BFI and public service broadcasters work to foster cultural diversity, providing UK audiences with access to a rich range of content that has not historically been provided by purely commercial services. Cultural diversity is supported both in terms of variety of genre and form, but also in terms of work that explores a wide range of identities and backgrounds, representing the breadth of experience of the UK public.

Channel 3 and Channel 5 services are both required to present a “wide and balanced range of high quality programmes which meet the needs and satisfy the interests of as many different audiences as practicable” by their licence agreements.4 Channel 4 is statutorily required to “reflect cultural diversity in the UK” and “champion alternative points of view”, while the BBC’s Charter Agreement sets out public purposes including to “show the most creative, highest quality and distinctive output” across genres, as well as to “reflect, represent and serve the diverse communities of the ’s nations and regions.”5 The BBC and Channel 4 play a particularly valuable role in supporting diversity in UK screen culture through their respective film departments too.

Championing UK BFI National Lottery funding, BBC Films and provide the backbone of funding for UK independent film. Over the past decade, BBC Films and Film4 have invested in 11% of all UK independent films, with these titles accounting for nearly 20% of overall spend on independent film at £888m.6 This demonstrates the fact that PSB investment backs some of the most significant independent films being produced.

Independent UK film plays a critical role in exploring and celebrating UK identities and influencing how we’re seen around the world. Independent films such as Blue Story, Pride and Rocks reflect UK ways of life on screen. This includes those from traditionally underrepresented communities - something of ever more importance in the era of Black Lives Matter and the ‘levelling agenda’. At the same time, PSB- backed films such as , Judy, and The King’s Speech have garnered critical acclaim (including a host of Academy Awards and BAFTAs) and furthered our reputation as a global creative powerhouse. These films tell distinctive UK stories in a way that major commercially-driven studios do not and this is essential to the continued health of the UK’s cultural tradition.

Independent film plays a critical role in building the skills and reputation of the professionals needed for big-budget HETV or Inward Investment Films in the UK: 41% of career credits for those who ended up working on a UK-based Inward Investment production in 2016 were Independent British Films. These roles significantly enable career progression as the flexibility required by limited budget provides opportunity for staff to 'step up' and gain experience.7 This proves true across all 40,000 working in film and TV production, as well as for above-the-line talent such as directors: and began work on independent films before blockbuster titles including The Dark Knight trilogy and Inception for example, returning billions in box office.8 Inward investment projects generated £3.6bn in production spend in 2019/20 - a 19% increase on the previous year.9 The role of PSBs in skills and training is explored further in the section below on economic impacts.

4 Ofcom, Licensing of Channel 3 and Channel 5, 2012 5 https://www.bbc.com/aboutthebbc/governance/charter 6 BFI Research & Statistics Unit 7 British Screen Forum, Local Heroes and Inbetweeners: The Contribution of British Feature Film Sector to the UK Audiovisual Production Industry, 2019, https://britishscreenforum.co.uk/local-heroes-and-inbetweeners/ 8 BFI Statistical Yearbook 2019

The role of PSB investment in independent film is becoming ever more important as investment in UK domestic production continues to decline: production spend on domestic UK features fell 54% in 2019/20 to £132m, having declined consistently since its most recent peak at £319m in 2015/16. In this period of great transformation for the sector, PSB investment is increasingly vital in order to sustain distinctive UK storytelling and to secure a pipeline of talent into the wider film and television industry that can maintain its current rate of rapid growth: the latest ONS figures show that the is the fastest growing part of the economy, having returned the highest CAGR (9.5%) of any industry in the UK – ahead of the historically fast-growing IT, air transport, and scientific research industries – over the most recent five year reported period from 2013 to 2018.10

Distinctive and inclusive UK broadcast content As with independent film, PSBs work to represent the diversity of the UK public through original programming that explores a wide variety of identities and backgrounds. Programmes such as Channel 4’s Derry Girls follows the lives of girls living in Northern Ireland and explores LGBTIQ+ issues, for example, while Michaela Coel’s May Destroy You on BBC Three focuses on issues of consent and features a majority black cast. Making such programming available on the services most accessible to the UK public, including those that cannot afford premium services, if of major public benefit. PSB broadcast content also helps define the UK’s cultural profile around the world, with titles like , Downton Abbey and The Great British Bake Off winning international acclaim.

In some cases, producing content that reflects different ways of life holds little commercial appeal for private broadcasters. PSBs’ mandate to serve all the UK’s audiences offers a valuable way of combating market failure and ensuring people from the widest range of backgrounds see themselves reflected on screen. A strong example of this is minority language content production. ’s public service remit is to produce Welsh-language content, ranging from Welsh-language news broadcasts to soaps such as Pobol y Cwm and dramas like Y Gwyll/Hinterland. The BBC’s management agreement requires it to support the production of content in UK-indigenous languages including Welsh, Gaelic and Ulster Scots as well as the Irish language. Supported by public funding including the Irish Language Broadcast Fund, delegated to NI Screen via the BFI, these requirements help preserve these languages and explore their role in our shared cultural heritage.

Young audiences’ content is another area on which PSBs serve to combat market failure. The removal of children’s programming quotas for commercial public service broadcasters and restrictions on advertising around children’s television, compounded by the often limited resale value of UK focused content, makes children’s television difficult to monetise for broadcasters and potential investors. Public service broadcasters spent roughly 40% less than they did in 2006 by 2017 (down from £116 million to £70 million). 98% of children’s programming in 2016 was repeats, with the BBC accounting for 87% of all first-run UK originated children’s programming by public service broadcasters.11 The huge role played by the BBC up until this point demonstrates the value of regulation in providing for underserved audience. Multiplicity of choice is being successfully fostered through the establishment of the Young Audiences Content Fund administered by the BFI, which provides £57m of grant-in-aid funding to

9 BFI Research & Statistics Unit, Film, high-end television and animation programmes production in the UK: full-year 2019, https://www.bfi.org.uk/sites/bfi.org.uk/files/downloads/bfi-high-end-tv-animation- programmes-uk-full-year-2019-v1.pdf 10 ONS, Services sector UK: 2008 to 2018, https://www.ons.gov.uk/economy/economicoutputandproductivity/output/articles/servicessectoruk/2008to 2018 11 Ofcom, Children’s Content Review, 2018 back the development and production of content for under-18s for broadcast by free-to-access, Ofcom- regulated services with a UK-wide audience has effectively fostered multiplicity of choice for young audiences in its limited period of operation. The fund has invested nearly £2 million across 63 development awards in its first twelve months and will announce its first trance of production awards shortly.

While PSBs clearly set out their intention to provide such inclusive content, opinion varies on how successfully they achieve it. The Lords Communications Committee’s 2019 report ‘Public Service Broadcasting: as vital as ever’ highlighted both quantitative and anecdotal evidence that PSBs underserve BAME audiences. Research for Ofcom demonstrates that ‘older women, young people, people living outside and people from ethnic minority backgrounds feel less satisfied with public service broadcasters than do other audiences.’ There is also evidence that PSBs are struggling to maintain younger audiences. Ofcom found that in 2018 the 16–34 age group consumed less than half as much BBC content as the average person: 72 minutes compared with 153 minutes on average and 77 minutes for this age group in 2017.12

The performance of PSBs in some areas can be counterpointed to a degree by that of SVoD services including and : both the Campaign for Broadcasting Equality and Directors UK highlighted the strength of content for BAME audiences provided by these platforms to the Lords Communications Committee. 16-24 year olds, who make up 14.9% of the population, make up only 7.4% of TV’s audience but 20.5% of SVoD audiences - a trend that is advancing over time.13 SVoD services are also producing an increasing amount of UK content in titles such as The Crown, Sex Education and Britannia. SVoD investment in pre-existing UK titles also continues to rise, with Netflix investing money in later series of shows such as Fleabag, Peaky Blinders and Black Mirror. Such programmes hold a significant position in the UK’s screen culture, but at present constitute a much smaller range and scale of investment in UK content than that made by the PSBs. While it is possible that SVoDs will continue to expand this investment in future, this will be at their discretion in contrast to the statutory and regulatory requirements imposed on the PSBs.

It is important to recognise that the relative performance of these services in some aspects does not undermine the overall value of the statutory and regulatory requirements on PSBs to reflect UK audiences. Requirements around representation, including quotas, must be maintained as the PSB model continues to evolve. It is critical to the cultural and societal health of the UK that all audiences see themselves reflected in film and television content, and such requirements ensure that broadcasters will continue to work to reflect these stories in future, even where there is less of a commercial incentive.

As representation in the screen sectors becomes an increasingly significant issue, it is also imperative that industry and Government consider how it may be fostered beyond the scope of current PSB regulation. Complementary measures include the BFI Diversity Standards, which require participating productions to demonstrate how they are actively working to improve representation in two of four areas (behind the camera, among audiences or through skills and training opportunities) in terms of the protected characteristics of sex, race and ethnicity, sexual orientation, disability, gender reassignment, age and pregnancy and maternity, as well as socioeconomic background, those with caring responsibilities and people based outside of London and the South East of .14

12 https://publications.parliament.uk/pa/ld201919/ldselect/ldcomuni/16/1602.htm 13 Ibid. 14 https://www.bfi.org.uk/supporting-uk-film/diversity-inclusion/bfi-diversity-standards

The Standards are mandatory for all BFI productions and have also been adopted by BBC Films, Film4 and . They are one of the eligibility requirements for the British film categories within the BAFTA Film Awards and for all British features competing in any category at the British Independent Film Awards (BIFAs). The BFI currently advocates for voluntary adoption of the Standards and works with studios and production companies to achieve this across all UK productions by 2022. It has published initial findings on the efficacy of these measures and has committed to a formal Review of the Standards in 2020 to ensure they working as effectively as possible.15 The UK Government should closely consider the value of such measures in additional to existing regulation as the broadcast landscape continues to evolve.

Preserving the UK’s moving image heritage The Public Service Broadcasters are crucial partners to the BFI National Archive in its work to care for and develop collections reflecting the UK’s moving image history and heritage. They are required by the 1990 Communications Act (revised 2003) to donate copies of programmes as requested by the national collection, and to make a ‘reasonable contribution’ towards the upkeep of this heritage. Ofcom as the regulator of the PSBs determines what constitutes a ‘reasonable contribution’. This currently amounts to c£1.2m across the PSBs. This has been essential bedrock funding, without which many of the programmes we love or admire would have been permanently lost. The PSBs’ working relationship with the BFI National Archive has enabled it to develop a collection reflecting innovation and excellence in British TV, with holdings ranging from The Avengers to The Naked Civil Servant to Broadchurch, and from the 1966 World Cup Final to The Stephen Lawrence Story to The Great British Bake Off.

While no such statutory obligation applies for or SVoDs, the BFI believes that introducing regulation requiring such contribution on cable television and SVoDs via would ensure better public value - particularly as SVoDs make an increasing contribution in terms of UK production. This would ensure that titles which are key to the story of the moving image in the UK such as The Crown, Black Mirror and The Grand Tour and are preserved for future public access. We believe that it would not be onerous for these streaming (and cable) providers to support the archiving of the UK’s indigenous production, and that legal requirements on this issue could achieve this goal by ensuring the financially appropriate maintenance of the UK’s national television archive for the benefit of people today and people to come. The Lords Communication Committee’s 2019 inquiry into PSBs and SVoD services recommended that such a requirement be introduced.16

THE ECONOMIC IMPACT OF PUBLIC SERVICE BROADCASTING

PSBs play an essential role in maintaining the health of the UK film & TV industries, with the UK production, distribution and broadcast workforce comprising 150,900 people and generating £21.8bn in GVA. As noted above, the latest ONS figures show that the film industry is the fastest growing part of the economy, having returned the highest CAGR (9.5%) of any industry over the most recent five year reported period to 2018.

Delivering jobs and growth across the UK

15 BFI Diversity Standards: Initial Findings, 2020, https://www.bfi.org.uk/education-research/film-industry- statistics-reports/reports/diversity-standards-initial-findings 16 https://publications.parliament.uk/pa/ld201919/ldselect/ldcomuni/16/1602.htm

PSBs have a major role to play in efforts to rebalance the UK economy and ‘level up’ areas across the nations and regions. Requirements on the PSBs concerning the proportion of content commissioned from UK independent production companies, as well as the proportion of content sourced from outside the M25, help to ensure the benefit of production activity is felt increasingly in communities right across the country. This is particularly important in the film & TV sector, where London and the South East accounts for 80% of the film, TV, radio and photography workforce, as well as 82% of its GVA.17

PSBs continue to account for the vast majority of commissions for UK production, investing £1.6bn in 2018. This accounts for more than 80% of linear commissions over the past decade, even as SVoDs and multichannels rapidly grow their own activity in commissioning original UK content. With 40% total UK commissioning spend being invested into new IP (and the BBC leading the charge at a total of 63% of all spend), statutory terms of trade on IP ownership ensure independent producers continue to feel the benefit of their work on these productions in the medium-long term. UK producers continue to generate over £400 million in revenues from a wide variety of secondary activities, including by exporting great British content to buyers around the world.18

Ofcom regulation on regional TV production and programming ensures PSBs commission a significant proportion of programmes made outside the M25, as well as on the need to broadcast localised programmes. This has been furthered by Channel 4’s establishment of offices in Leeds, Bristol and Glasgow as well as the BBC’s presence in Salford’s MediaCity. Such measures enable areas to develop their local screen sectors, including crew bases, studio facilities and location services which can also be used by the film industry. Screen clusters across the UK operate in a virtuous circle, whereby a consistent level of production investment enables them to develop local infrastructure and secure their status as a viable place to live and work for crew, which in turn attracts further projects. This is demonstrated in areas such as Yorkshire, where BFI-backed agency Screen Yorkshire serves to attract and coordinate both film and TV investment in the region. The effectiveness of this function has contributed to major wins for the Yorkshire production sector in recent years, including the relocation of Channel 4 HQ as well as a £15m investment in screen content through the AHRC’s Creative Industries Clusters Programme as part of Government’s industrial strategy. The effectiveness of such quotas looks set only to increase as the proportion of content required, as well as new terms requiring production companies to have a ‘substantive base’ outside of the M25, come into effect from January 2021. It is essential that this regulatory requirement to foster the screen sectors across every nation and region of the UK be preserved as the broadcasting landscape continues to evolve.

The growing number of UK-based SVoD productions provides an opportunity to further expand the production sector outside of London. This is facilitated by the establishment or expansion of studios including Titanic Studios in Belfast and Wolf Studios in Cardiff, as well as ongoing developments such as Mercian Studios in Digbeth, Birmingham and another in Leith. Some SVoD production taking place outside the South East at present, including Netflix’s Sex Education and BBC/HBO co-production His Dark Materials, both based in Wales. The continuing growth of SVoD production offers a major opportunity to further rebalance the distribution of the screen sectors across the UK.

Skills and training While the UK’s film and TV production sectors have been an economic and cultural success story in recent years, their continued growth is threatened by widening skills gaps: 2017 research for the BFI

17 DCMS, Creative Industries Sub-sector Economic Estimates 18 Pact, UK Television Census 2019, https://www.pact.co.uk/asset/07D6C878-DDC9-439D- 95E86185F4CD32AF/ predicted that a growing film sector will create 25,000 new opportunities alone over the next five years. The BFI has invested £19 million in sector skills body ScreenSkills in order to deliver a ten-point plan designed to ensure this workforce is properly grown and trained over this period.

PSBs play a major role in developing the UK film and HETV workforces: nurturing talent is a key part of Channel 4’s public service remit, while a requirement to grow the UK’s production workforce is written into the BBC’s 2017 Management Agreement with DCMS. PSBs run a number of skills and training programmes, including practical placements on productions. All productions commissioned by UK PSBs also contribute to the voluntary HETV Skills Investment Fund, which charges productions 0.5% of their UK production budget to invest in skills activity designed to develop freelancers and talent working at all levels in HETV. Similarly, all film productions in receipt of public funding - including from the BFI, BBC Films and Film4 - are required to contribute to the Film Skills Fund, which works to achieve similar ends for the film sector. Contribution to this levy is voluntary for other film productions. The importance of publicly-funded independent film in particular in building the workforce is set above in this response’s section on cultural impacts.

SVoDs have begun to contribute to the UK’s skills and training agenda. Netflix have paid into the HETV Skills Investment Fund, while offering skills and training placements on Wales-based production Sex Education and collaborating with the Production Guild of Great Britain to establish a small production accountancy traineeship too. This early-stage work is beginning to complement the wider commitment to skills and training demonstrated by UK PSBs. It is vital that SVoD programmes continue to grow this commitment to skills and training, working with relevant UK stakeholders such as ScreenSkills to ensure a joined-up, comprehensive approach to building the workforce in order to ensure its long-term sustainability.

The importance of UK content qualifying as “European works” to screen sector growth The revised Audiovisual Media Services Directive which is being implemented across the European Union by the end of 2020 requires that “European Works” make up 30% of content on on-demand services in the EU. This is in addition to the existing quota of at least 50% of content being European works. UK exports’ ability to count towards the linear quota has helped make the EU its second largest export market, worth approximately £0.5bn per year.19 It has also secured inward investment, including in PSB co-productions such as BBC/HBO collaboration His Dark Materials and BBC/’ Good Omens, which grew 16% in 2018 to a record-breaking £3.6bn. The 30% on-demand quota will likewise be an invaluable market opportunity for works made by PSBs (and others) in the UK. UK content will continue to qualify for these quotas as the EU’s Audiovisual Media Services Directive states that a work can qualify if it originates in a European third State party to the European Convention on Transfrontier Television (ECTT) of the Council of Europe, to which the UK remains a signatory. This status must be maintained.

THE SOCIETAL IMPACT OF PUBLIC SERVICE BROADCASTING

Access to reliable news sources The ongoing COVID-19 crisis has thoroughly demonstrated the importance of free-to-access, reliable and impartial news sources to public health and wellbeing and has demonstrated the unique ability of PSB

19 BFI Statistical Yearbook 2019, https://www.bfi.org.uk/sites/bfi.org.uk/files/downloads/bfi-statistical- yearbook-2019.pdf services to deliver this. Communicating the latest information on medical and policy responses to Coronavirus, including around social distancing measures, has been critical to keeping people as safe as possible. Research for the Institute at the University of Oxford finding that 59% of people in the UK use news organisations to get the latest news on coronavirus - more than any other source. 79% of UK respondents use online platforms to gather this information, with 70% using the TV and 34% the radio - a proportion second only to Germany.20

A survey conducted by IPSOS MORI found the BBC to be the UK’s most trusted news source in 2020, with 62% of adults who follow the news reporting that they are most likely to turn to the BBC for accurate news coverage, followed by 9% saying and 5% saying ITV. When asked who they are most likely to turn to for impartial news coverage, around half (51%) said the BBC, followed by 7% saying Sky News and 5% saying ITV. This huge vote of confidence in the reliability of BBC news sources is in contrast to a wider climate of increasing mistrust: the proportion of people in the UK that trust news has fallen from 51% in 2015 to 40% this year. 70% of people in the UK reported that they are concerned about the reliability of what they read online. The BBC still tops the table as the UK’s most trusted news source, just ahead of ITV News, the and .21

Moments of national unity PSBs bring the UK together for moments that shape our shared history and forge national identity. From seminal events like the London Olympics 2012 or 2020’s celebrations for the 70th anniversary of VE day through to royal weddings, Comic Relief and annual Remembrance Sunday services, PSBs allow as many people as possible to share in these moments and come together as a nation. The importance of sharing these moments with as many people in the UK as possible is at the of the Broadcasting Act 1996 as amended by the Television Broadcasting Regulations 2000 and the Communications Act 2003, which ensure that major listed sporting events such as the FA Cup Final, the Wimbledon Tennis Finals and the Rugby and FIFA World Cup Finals on an exclusive basis including through subscription services. This ensures these moments truly can unite as many people as possible, regardless of financial barriers imposed by premium subscription services.

20 Reuters Institute, Navigating the ‘infodemic’: how people in six countries access and rate news and information about coronavirus, 2020, https://reutersinstitute.politics.ox.ac.uk/infodemic-how-people-six- countries-access-and-rate-news-and-information-about-coronavirus 21 Ipsos MORI, Trust, accuracy and impartiality in news market context survey, 2020, https://www.ipsos.com/ipsos-mori/en-uk/bbc-most-trusted-news-source-2020