CLAUSE 26.—(Conditions governing registration of British films as quota films.) (Hansard, 24 February 1938)

§ The Parliamentary Secretary of the Board of Trade (Captain Euan Wallace)
I beg to move, in page 23, line 45, at the end, to insert: (2) A film registered under this Part of this Act as a British film shall not be registered as a renters' quota film unless—

(a) the maker of the film was, throughout the time during which the film was being made, a person carrying on business in the United Kingdom and having his principal place of business therein; and

(b) the studio, if any, used in making the film is within the United Kingdom, and

(c) at least half the requisite amount of labour costs, as defined by Sub-section (2) of the last preceding Section, represents payments which, as part of the labour costs of the film, have been paid or are payable in respect of the labour or services of British subjects ordinarily resident in, or persons domiciled in, the United Kingdom."
This Amendment introduces a new condition into the requirements that have to be satisfied before a film is accepted as a renters' quota film. It is being inserted to implement a promise made to the hon. Member for East Wolverhampton (Mr. Mander), embracing the sentiments of the vast majority of the Committee, that some step should be taken to prevent the possibility of a quota film being made in parts of the Empire other than Great Britain—in which case, of course, the production would not in any way help the film-producing industry of this country—and then counting for renters' quota. The Amendment contains three essential conditions in addition to the cost test which a film must satisfy in order to be registered as a British renters' quota film. First of all the maker of the film must be a person carrying on business in the United Kingdom and have his place of business there during the whole time that the film is being made. Secondly, any studio used for the making of the film must be a studio in the United Kingdom Thirdly, at least half the requisite amount of the labour costs mentioned in 590 the amended Sub-section (2) of Clause 25, that is at least half of either three-quarters or four-fifths of the total labour costs according to whether one or two foreigners are excluded must have been paid in respect of the labour or services of British subjects ordinarily resident in, or of persons domiciled in, the United Kingdom. We feel that the application of these three conditions should ensure that the renters' quota provisions are not met by the production of films for foreign renters in other parts of the Empire merely for the purpose of satisfying their quota here. The Amendment carries out in their entirety the wishes of the Committee.

§ Mr. T. Williams
We are not averse to accepting the Amendment, which is intended to fulfil a promise made in Standing Committee. But I would ask one or two questions. Paragraphs (a) and (b) of the Amendment can be taken as read, but with regard to paragraph (c), referring to labour costs, while the printed word is perfectly clear, we should like to know exactly what steps the Government are going to take to ensure that these payments are made to employes resident within the United Kingdom. For instance, it may be that a film is made two-thirds in East Africa and one-third in Britain. The one-third would obviously be made in a British studio, and it would be made by a British company, but how are we to ascertain whether or not the labour conditions are fulfilled in the case of a film made in East Africa, Canada, Australia, New Zealand or anywhere else? It is proper to put on paper this wording, but I can imagine it will be much more difficult in administration to determine whether or not these labour costs conditions are being met.
One other question with regard to the words "or are payable" in paragraph (c) of the Amendment. They refer to the payments made to employés engaged on these particular films, assuming that the film has been made in some part of the Dominions or Colonies. My question is this: Why should not the wages have been paid before the film is registered at all? These words "have been paid or are payable" are very slippery, and it may be that although the producer of the film has paid some portion of the wages and has made a promise to pay the other part, that other part may never 591 be paid. Therefore, this particular film would be registered under false pretences. I am sure that the right hon. and gallant Gentleman does not intend that and that he does not anticipate that it will happen, but at least we ought to be given an indication as to how it can be prevented.
There is a further question. The words "have been paid or are payable," mean quite obviously that some of the wages might be paid during the course of the making of the film and other portions might be deferred to a later date. If the Amendment is to be accepted with these words in it, is any time limit to be enforced to ensure that the film is made strictly in accordance with the conditions laid down? What time limit ought to be given before the producer of the film pays the deferred wages? If there is a time limit, how long should it be before an appeal can be lodged to restrain the producer of that film from further exhibition unless the word as well as the spirit of the Amendment has been fulfilled? These questions are not intended to embarrass or delay, but from the point of view of the workers and of good administration, I hope the right hon. Gentleman will give us a reply.

§ Mr. Mander
Subject to the points raised by the hon. Member for Don Valley (Mr. T. Williams), it seems to me that this Amendment is a reasonable attempt to meet a promise that was made in the Standing Committee on an Amendment that I had moved. It goes some way to carry out the recommendations of the Moyne Committee, and goes even further than they indicated.

§ Captain Wallace
I think I can satisfy the hon. Gentleman opposite quite easily. He referred to a film being made in East Africa. The hon. Member will observe that paragraph (a) of the Amendment says that the film has to be made by a person carrying on business in the United Kingdom. There is just the same amount of control over his wages costs as if that film were made at home. Secondly, all the studio scenes have to be shot in the United Kingdom. Thirdly, the question of these wages costs is covered in exactly the same way by statutory declaration as if it were an ordinary film 592 made in this country. The words "paid or are payable" are put in for this reason: In some cases persons employed in the production of a film obtain a share of the profits as some part of their emolument. The House will realise that it would be impossible to hold up the registration and exhibition of a film until those further instalments payable under a contract had been paid. There is no such time limit as he has suggested. All these people are under contract, under which they can sue. It will not be a practicable proposition if, at some future date, whether you put it at three months or six months or a year, the registration of a film could be cancelled because a company refused to discharge a contractual obligation for which there was a remedy open to the employé in the courts.

§ Mr. T. Williams
I quite agree that the ordinary agreement between employer and workman exists, but, since this is a statutory condition, ought it to be left to an employé who finds that his employer has defaulted as regards the payment of deferred wages to go to the courts and sue his employer for the wages due to him? I do not wish to press the point further, but I hope the Parliamentary will look into it from the workers' point of view.

§ Mr. Day
Surely the Parliamentary Secretary will have heard of cases where labour costs have been adjusted by smaller film-producing companies by paying part of the wages in cash and giving I.O.U's. for the balance. In some such cases, where the companies have gone into liquidation, the employés have had to file their claims with the receiver in bankruptcy. As regards labour costs in foreign countries, surely the Parliamentary Secretary realises that many of these companies go out there and simply superintend the staff, engaging an enormous amount of labour in these foreign countries. That point is not covered by his explanation, and perhaps he will consider it also.

§ Captain Wallace
I beg to move, in page 25, line 7, to leave out "six," and to insert "twelve."
593 This Amendment introduces a further safeguard into the provision inserted in Committee providing in certain circumstances for an appeal against the cost test. It was originally suggested that if this procedure was brought into operation—and it would require a recommendation from the Films Council, the concurrence of the President of the Board of Trade, and approval by a resolution of this House—a period of six months should be allowed in order not unreasonably to harass the producer who has made his arrangements in advance. My right hon. Friend thinks that in all the circumstances a period of six months is on the short side, and the Amendment would substitute 12 months, thus providing that at least a year must elapse after the making of the order before an appeal can be entertained. It is, I think, a reasonable provision, and I hope that the House will accept it.

§ Mr. T. Williams
I must disagree with the suggestion of the right hon. Gentleman that this is a reasonable provision. Sub-section (4) of the Clause, which provides for an appeal against a succession of future "quota quickies," is a very poor and puny kind of thing, and I do not think it will have any real effect. I agree that it was a concession to those who display these films, but it is a very slow-moving procedure. If a film is produced which has not the requisite entertainment value, someone must first of all appeal, either to the Films Council or to the Board of Trade. The Films Council must examine the case, and must satisfy the Board of Trade that the film has not a proper entertainment value; and only then would it be possible to prevent its further distribution after a period of six months. It is proposed now to extend the period to 12 months, which I fear will not in any way discourage the production of such films. I think it will weaken what was already a very weak Clause. I do not propose to ask my hon. Friends to divide against it, but I am sure that those responsible for the exhibition of films will feel that, as I say, it definitely weakens an already weak Clause.