CINEMATOGRAPH FILMS (LEVY) (Hansard, 22 July 1963)

§ The Parliamentary Secretary to the Board of Trade (Mr. David Price)
I beg to move, That the Cinematograph Films (Collection of Levy) (Amendment No. 3) Regulations 1963, a draft of which was laid before this House on 2nd July, be approved. I suggest, Mr. Deputy-Speaker, that it might be for the convenience of the House to discuss at the same time the Cinematograph Films (Distribution of Levy) Regulations, 1963.

§ Mr. Deputy-Speaker (Sir William Anstruther-Gray)
If that is the wish of the House, yes.

§ Mr. Price
These Regulations embody a number of further changes in the statutory scheme whereby cinema exhibitors pay a levy on admission charges for the benefit of producers of British films. All the changes embodied in the Regulations have been recommended to us by the Cinematograph Films Council. I hope, therefore, that they will recommend themselves to the House.
1199 The main changes are in the Distribution Regulations, where there are two major changes and 13 minor ones. The first of the major changes is that news-reels are to get an increased rate of payments. The second is that films which are jointly produced by British and foreign makers in accordance with inter-Governmental co-production agreements are to become eligible for levy benefits.
First, newsreels. The change in regard to newsreels is being made in order to reduce the disadvantage which they at present suffer relatively to other short films. At present, newsreels' entitlement to levy is calculated in direct relationship to their commercial earnings, whereas the entitlement of other short films is calculated on those earnings multiplied by two and a half. The old-style black and white newsreels were badly hit by the competition of news broadcast on television and three of the five newsreels were discontinued. More recently, helped by the revenue from the levy which the Cinematograph Films Act, 1960, secured to newsreels, the surviving companies have found that cinema audiences still enjoy newsreels if they are on suitable subjects enhanced by the use of colour. It helps the other films shown if the newsreel is part of a general programme offered to an audience.
In view of this, plus the further considerations that improved newsreels are more costly to produce and that the newsreels do a useful job in presenting Britain factually overseas, it seems to us, as it does to the Cinematograph Films Council, right to reduce the disparity between the rate of levy payments on newsreels and those on other short films. The Regulations before the House, therefore, provide for the calculation of newsreels' benefitsfrom the levy on the basis of double their commercial earnings. In making this proposal for the double rate, my right hon. Friend is accepting the advice of the Cinematograph Films Council that the full two-and-a-half times rate applicable to other shortfilms would be inappropriate, largely because of the more favourable series bookings on which newsreels are supplied to exhibitors.
I turn now to the second major change in the Distribution Regulations, the proposed admission of co-production films 1200 to levy. Section 19 of the Cinematograph Films Act, 1960, already provides for Orders in Council enabling co-production films to be treated as British for quota purposes. The first moves towards co-production agreements with France, Italy and Germany have recently been made. The Regulations now before the House include the changes necessary to enable us to offer the benefits of levy in our efforts in the forthcoming negotiations to secure the maximum benefits for British film makers.
There are altogether 13 other smaller changes in the Distribution Regulations. Nine of these are either themselves designed to accelerate the process of distributing payments to producers or derive logically from such changes. I think that, at this time of night, the House will not want me to go through them in detail, though I am quite ready to do so if it wishes.
The change made by the amendment to the Collection Regulations is, by contrast, a very simple one. All it consists of is bringing the collection of levy from exhibitors from the present weekly basis on to a four-weekly one. The weekly basis of calculating exhibitors' liability to pay levy, including the weekly exemption which was raised to £300 last November, will remain.
Four-weekly collection has been proposed by exhibitors' interests. It is a further minor measure of relief for exhibitors, many of whom have been finding it difficult to continue in business in the face of declining cinema admissions.
As I said at the beginning of my remarks, all these changes have been recommended by the Cinematograph Films Council. I hope, therefore, that they will meet with the approval of the House.

§ Mrs. Eirene White (Flint, East)
As the Parliamentary Secretary has said, these Regulations are mostly for administrative convenience. In dealing with the Regulations concerning the collection of levy, the hon. Gentleman might have given the House an idea of what the financial advantages or disadvantages might be. I understand that collection on a 28-day basis would save a certain amount of money, but, equally, 1201 the Agency would lose a certain amount by having to dispose of the money rather sooner than would otherwise be the case. I am also told that the producers will, perhaps, have to be kept waiting a little longer for their money, but that on balance they think that the interests of the exhibitors will be better served and that after a little reluctance, they have agreed to the proposal. We should, however, be given the figures.
On the Regulations concerning the distribution of levy, it is only right that the House should be aware that there has been a good deal of discussion whether the newsreels should be entitled to the additional benefits which we are bestowing upon them by the Regulations. One of the strongest arguments that was made for newsreels was not that they were of so much advantage in this country, but that they were of value because they displayed the British way of life to people abroad. We can have differing opinions about how far they are successful in displaying those aspects of the British way of life that we would like to be widely circulated.
Others have felt that if that was the main purpose of supporting the news-reels, the Government might contribute something through the Central Office of Information or otherwise and that it was not necessarily right that the producers of other films should have to pay for the newsreels. However, when all these matters had been discussed, the Cinematograph Films Council finally decided to support the proposal which is embodied in the Regulations.
I wonder whether the Parliamentary Secretary can say a word or two more about the Regulations in so far as they deal with co-production. At the moment, there are no films to which this could apply. Can the hon. Gentleman give us any idea of when he thinks that this extremely slow-moving procedure of obtaining co-production agreements might be finalised with any country? The negotiations with Italy are, perhaps, a little further advanced than with any other country. It seems to me that the negotiations with France have been going on almost interminably, and before we pass Regulations for something which is not in existence we should at least have an idea when this part of the Regulations might be expected to become effective.
1202 With those few comments, it seems to me that there is no reason to contest any of the Regulations. They are for the general convenience.