HC Deb 01 June 1954 vol 528 cc1072-4
40. Mr. Shepherd

asked the President of the Board of Trade when he expects that the National Film Finance Corporation's Report for the year ended 31st March, 1954, will be published; and what action is proposed with reference to the British Lion Film Corporation.

Mr. H. Strauss

The Report was laid before the House this morning and copies will be available in the Vote Office after Questions. It shows that the financial position of the British Lion Film Corporation has deteriorated seriously and that the National Film Finance Corporation has decided to call in its loan and exercise its right to appoint a receiver and manager. The Government have expressed their agreement with the Corporation in this decision, and I understand that the receiver is taking up his duties today.

The policy issues arising out of this decision have been discussed between the National Film Finance Corporation and the Government. The Corporation has recommended, and the Government have agreed, that steps should be taken to create a new company, to come under the complete control of the National Film Finance Corporation or the receiver, in order to continue the distribution functions hitherto performed by the British Lion Film Corporation. The new company will not itself make films.

Mr. Shepherd

While the House will naturally regret the necessity for this step, although it will recognise that it cannot be avoided, may I ask if my hon. and learned Friend will give an assurance that so far as possible other producers will be induced to go to Shepperton and thereby provide continuing employment in the studios.

Mr. Strauss

I can assure my hon. Friend that the British Lion Studio Company is a separate public company which provides studio facilities for producers. The shares owned by British Lion will come under the receiver's control. Current film production will keep the studio running until the middle of August, when it is hoped that the new company will be in operation.

Mr. H. Wilson

In view of the far-reaching and possibly—I say possibly—disastrous effects of this decision, will the hon. and learned Gentleman give an assurance that as far as possible he will do his best to maintain the continuity of the present distribution arrangements through the British Lion organisation? Secondly, will the new company have power to finance production by preproduction guarantees, and will money be available for that?

Mr. Strauss

The idea of forming the new company is both in the interest of the wise disposal of the existing assets and in the interests of film production. As for advances to the new company by the National Film Finance Corporation, such advances are possible. As for borrowing by the National Film Finance Corporation itself, it has not used the powers of borrowing available under the 1952 Act.

Mr. Wilson

Is it intended that this new company will be in a position to finance independent producers, as envisaged under the 1948 Act, or have the Government it in mind to drive the industry more and more into the hands of the big circuits?

Mr. Strauss

We have certainly in mind the interests of the independent producers, but in answer to this Question I cannot attempt to allocate the work as between the new company, which will be a distribution company, and the National Film Finance Corporation itself.

Mr. Beresford Craddock

Do I understand from my hon. and learned Friend that the appointment of a receiver may lead to the cessation of the production of films at Shepperton studios? Can he give an assurance about the future of those studios which, as he knows, are very well equipped?

Mr. Strauss

I thought I had dealt with that point in answer to the first supplementary question. Current production will keep the studio busy until the middle of August, and we hope that the arrangements which will come into effect will keep them busy permanently in the interests of film production.

Mr. Gaitskell

Is the hon. and learned Gentleman aware that the British Lion Film Corporation was the only important British distributing company which provided facilities for independent producers—independent of the big circuits? Can he give the House an assurance that there will be no interregnum between the winding up of the activities of British Lion and the coming into operation of the new company which he has mentioned?

Mr. Strauss

The right hon. Gentleman will realise that British Lion is not being wound up. A receiver and manager is being appointed. The arrangements which I have outlined, I think, diminish the risk of any interregnum, as far as they possibly can.

Mr. Gaitskell

Can the hon. Member also—[HON. MEMBERS: "Oh."]—this is a very important matter for the British film industry; can the hon. and learned Member also say whether this new company is being formed by the Film Finance Corporation or by private enterprise?

Mr. Strauss

The legal steps are somewhat complicated. I think it will be formed by the receiver.