HC Deb 09 April 1973 vol 854 cc1079-94

10.13 p.m.

The Under-Secretary of State for Trade and Industry (Mr. Anthony Grant)

I beg to move, That the Cinematograph Films (Collection of Levy) (Amendment No. 3) Regulations 1973, a draft of which was laid before this House on 26th March, be approved. These regulations are entirely consequential, following the application of VAT to the price of admission to cinemas. It happens that the levy which cinema exhibitors are required to pay to the British Film Fund is geared, as the regulations stand at present, to the full price of admission. If that price goes up because of VAT, the levy would go up, too, which is a consequence not intended. The amending regulations before the House will maintain the status quo.

The regulations are made by virtue of Section 2 of the Cinematograph Films Act 1957, the operation of which was extended for 10 years by the Films Act 1970. The Act provides for the imposition of a levy on exhibitors of cinematograph films, and for the distribution of the proceeds of that levy, with minor exceptions, to makers of British films.

Section 2 of the 1957 Act requires the Department of Trade and Industry to make regulations prescribing the rate and method of collection of the levy, and to consult the Cinematograph Films Council before doing so. This has been done, and all sides agree on the need for these regulations.

Perhaps it will assist the House if I give an illustration of how, if these regulations were not passed, an anomaly would arise. At present, the amount of levy payable on a seat price of 40p is 3.6lp, leaving the net amount retained by the exhibitor at 36.39p. With VAT added, the burden of levy on the exhibitor would change. The price of the seat becomes 44p, but VAT, and levy on this higher price, would together take 8.05p, leaving the exhibitor with 35.95p. To retain his same net price after VAT on the sample admission price of 40p the exhibitor would have to raise his total price by between 11 and 11½ per cent., which nobody wants to see happen.

I had some inquiries made of the principal companies engaged in cinema exhibition throughout Great Britain, not just of the two major circuits, and I am pleased to be able to say that, no doubt in anticipation of these amending regulations being passed, no exhibitor has put his prices up by anything like this higher amount and that, taken overall, the increases are less than 10 per cent. Moreover, none of these companies is raising the special prices applicable to old-age pensioners and children's cinema clubs. In these cases the exhibitors will be paying the VAT themselves.

VAT is a tax unconnected with the film levy, and it is right that the levy should continue to be collected uninfluenced by VAT. For that reason amending regulations have been drawn up so that, for levy purposes, the price of the seat will exclude the amount payable as VAT, and the amount which the exhibitor has to pay to the levy will be the same as it is now.

There is a further point which relates to the special provision in the regulations designed to help cinemas with particularly low takings. If the takings are below £500 per week no levy is payable. Furthermore, in order to afford some relief to cinemas whose box office takings vary widely according to the season of the year, the regulations provide that levy is payable only if both takings in the relevant week and average takings from the beginning of the levy year exceed £500.

If the regulations were not made, the addition of VAT to seat prices in these cinemas for the purposes of levy would put some of them above the minimum laid down so that they would be liable to pay the levy. The amendment accordingly provides that, in the case of the low-takings cinemas also, VAT shall be left out of account in computing the amount of weekly takings for purposes of levy liability. These regulations will come into operation the day after they are made, which means, subject to the decision yet to be made in the other place, 13th April. Hon. Members will see from paragraph 3 of the amendment that it applies to each levy period ending after that date. Levy periods last for four weeks and the current period ends on 14th April-next Saturday. The arrangement will thus be effective from the introduction of VAT and some very awkward levy computations which would otherwise have been necessary will have been avoided.

That is the reason for my seeking the indulgence of the House in agreeing to consider these measures at short notice and I ask the House to approve the regulations.

10.18 p.m.

Mr. Roy Mason (Barnsley)

The regulations in themselves are not controversial but the background to their necessity certainly is. They give a slight concession to the exhibitors which has been sought by all concerned in the industry -the Cinematograph Exhibitors Association, the Association of Independent Cinemas, the Kinematograph Renters Society, the Film Producers Association and finally approved by the Cinematograph Films Council. But if I understand the proposal aright, it is to relieve the cinema exhibitors from the obligation to pay extra amounts of Eady levy when VAT increases the gross price of a seat. So, what was feared in the industry-'hat there was to be a tax on top of another tax-is avoided and therefore value added tax is deducted before the Eady levy is computed.

For the information of the House the Eady levy is a levy at the rate of one-ninth of the excess of any seat price over 7½p. This goes to the British Film Fund, which decides how it shall be apportioned to the makers of British films. I should like the Minister to tell us how much levy was collected during the calendar year 1972, or, if the figures are available, up to the end of March 1973-because value added tax at 10 per cent. and the resultant price increases for admission mean an inevitable fall in the number of admissions. The levy figures of 1972 or 1972–73 should provide us with a useful yardstick. Some cinemas now contributing to the levy fund might, with higher prices and much lower admissions, drop into the non-contributory sector.

Secondly, the Government reduced the entertainments tax on cinemas as a result of the industry's being prepared to help fund British film production out of its own takings. That is the history of the Eady levy. But now the Government are slapping another form of entertainment duty on the cinemas in the guise of value added tax. I hope that the Minister can tell us why.

Thirdly, my greatest concern is that, having had the full value added tax of 10 per cent. thrust upon it, the film industry will-and this has already been reflected in higher seat prices, contrary to what the Minister says-be badly shaken. Whether the price of cinema seats increases across the board or only in the higher price range, the result is bound to be lower admissions. With lower admissions, the attraction of film production will be lessened, and the City and investors will shy away.

The situation is aggravated by the increase of production costs by at least 4 per cent. because of VAT. In a few months' time the industry may well be struggling for finance. Admissions are already declining.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

The right hon. Gentleman has just spoken of costs going up by 4 per cent. Surely the input tax would be deductible from that, as would selective employment tax and purchase tax, in so far as the industry paid it. Therefore, I do not think that the cost of cinema seats should increase by anything like 10 per cent.

Mr. Mason

The hon. Gentleman has been involved. He must realise that the cinemas have not incurred purchase tax, and SET is negligible for the few people they employ per cinema seat. Therefore, it is likely that there will be an increase of up to 10 per cent. in the price of cinema seats. Already in the London circuit it has increased by an average of 8 per cent. to 8½ per cent.

In 1972 admissions declined by 18,750,000 people. In spite of a previous price increase, owing to rising costs, the gross takings were down as well. We know from the Eady levy returns that 836 cinemas take less than £500 a week, and therefore do not pay the levy, and that 142 cinemas take between £500 and £700 a week.

Because of the regulations, the Eady levy being computed on the old basis, most of the cinemas will still not qualify for levy payments. But, as the Minister and the whole industry knows, these cinemas are in the area of doubtful profitability, and any price increase will have a disastrous effect upon their future.

Nearly a thousand cinemas could be in danger of closing as a result of the 10 per cent. value added tax. The tax is bound to force the pace of run-down in the British film industry. Seventy-seven cinemas closed in 1971, and if the 10 per cent. imposition is put on across the board it is bound to hasten that process.

What of the social implications? The thousand cinemas struggling to stay alive are not in the West End or the London circuit. By and large they are located in rural, suburban and less affluent areas. If they close, only undesirable adverse social consequences can result. I hope that the Minister will bear that aspect in mind as well.

If the United Kingdom film market declines, as I fear it will, finance for British film production will be more difficult to obtain. The result will be fewer films or cheaper and less attractive films, which in turn will also jeopardise our export market. I should therefore like to know what estimate the Minister has made of the effect of a 10 per cent. value added tax on the future of the industry, on the possibility of cinema closures, on work in the studios and on the unemployment in the industry that will result. In this regard I hope that he can assure us that he will constantly survey the trend and that if it shows a serious closure cycle, with its consequent repercussions on studio work and film finance, he will not hesitate to review the 10 per cent. rate with a view to its abolition or drastic reduction.

I cannot understand why the Government seem to hate the film industry so much and seem bent on killing it off. No other Common Market country imposes 10 per cent. VAT on its film industry. According to the figures of the Film Producers Association, Denmark has a rate of 7 per cent. but by 1975 is to have zero rating; France is proposing a 7.5 per cent. rate, the same as for books, but this has not yet been accepted; Belgium has 6 per cent.; Italy has 6 per cent. and that goes for books and newspapers; Ireland has 5.25 per cent., and the same as for books; Ger- many has 5.5 per cent., the same as for books and newspapers. Why do we have a 10 per cent. rate on our own industry which has to compete with all those countries in production and in export sales? Secondly, in most of those countries books and newspapers have a rate similar to that for films, and that should be so in the United Kingdom.

Finally, I draw attention to the Government's attitude to theatres as compared with cinemas. Last year, in reply to requests for VAT concessions for theatres, the Chancellor of the Exchequer said: The Arts Council, in calculating the level of subsidy required by the various institutions it supports, will decide after April, 1973, whether any additional help is needed. When VAT is introduced purchase tax and SET will be abolished, and it will then be for individual managements to decide whether they need to raise their charges … the Government will make special supplementary provision during 1973 for the Arts Council. This in turn will enable the Arts Council to make special provision for the various institutions before the end of the financial year."—[OFFICIAL REPORT, 11th May 1972; Vol. 836, c. 1685.] That indicates a possible subsidy to theatres if VAT involves material injury for them.

The Government are guilty of double standards. They are imposing a full VAT burden on the cinemas and on films while offering a favourable outlook to the theatres. This is the first time that we have had an opportunity to debate the introduction of VAT on the film industry. Although it is late—both the hour and the debate—and my remarks have been brief, I think that I have covered most of the matters that are causing the industry anxiety and concern. I hope that the Minister will take a little time and some care to study what I have said and that he will take steps to alleviate the worries that I have expressed. I hope that he will do that when he replies to the debate before we allow the regulations to go through.

10.28 p.m.

Mr. Hugh Jenkins (Putney)

The imposition of value added tax on the cinema has not hitherto attracted the attention that it should have had. Even when we discussed going into the Common Market, we debated mainly the consequences of doing so for the production end of the industry. At that stage we did not discuss the incidental consequences of VAT, because the Government had adopted it in advance and it could have been said that they intended to introduce it in any case and that going into the Common Market was incidental to doing so. I take the view—and I believe that few would argue with it— that it is at least doubtful whether the Government would have adopted VAT but for their determination to go into the Common Market; the two are closely linked.

Be that as it may, when we discussed entering EEC we talked about the film production industry and we did not discuss the consequences of the impact of VAT on the film industry generally and particularly on exhibitors. Like my right hon. Friend the Member for Barnsley (Mr. Mason), I welcome this opportunity to talk about the imposition of VAT upon the cinema, which has not really been discussed.

We talked about the imposition of VAT on the theatre. The Chancellor of the Exchequer offered some hope. He said that if the consequence of imposing VAT upon the theatre would be to put companies supported by the Arts Council into difficulty, he would consider putting his hand in his pocket and reimbursing such companies through the Arts Council. That is a cack-handed and complicated way of going on. It astonished me that the Government should impose VAT on the theatre in such a way, but now I confess that I am no longer astonished about anything that the Government do.

The Government held out some hope to the supported theatre that there might be some reimbursement but denied the commercial theatre any possibility of reimbursement of VAT. I suppose that the Government regard the cinema as being in the commercial area and, therefore, bound to carry the impact of VAT in the same way as the commercial theatre. It will, incidentally, have the effect of recreating the old enmity which existed between the supported or subsidised theatre and the commercial theatre. I hope that my fears will not be realised, but already there are signs of considerable resentment among commercial theatre managers. They feel that the Arts Council will be put into a position which they will not enjoy.

The Government support indirectly the cinema as they support the theatre. Why do they feel that they must take action against the cinema?

I do not wish to give the impression that the regulations are unwelcome, as they provide that VAT will be payable by the cinema at 10 percent. instead of 11½ per cent. To that limited extent the regulations are a welcome measure. Most people in the cinematograph film industry will say that if the cinema is to carry VAT it should carry only the appropriate figure and should not be required to pay more than 10 per cent.

Why do the Government feel that the cinema should carry the tax at all? They do not take that view about books. Other Common Market countries do not find it necessary to exact a 10 per cent. VAT upon cinema attendances.

The House has recognised in the past that the cinema and the film industry have been going through a difficult time for many years. Attendances have been declining year after year. The cinema has for a long time been waiting patiently for the decline to iron out, but it has not done so. Attendances have gone down and down. The younger people are now the chief supporters of the cinema. People with families stay at home and look at television. Therefore, the imposition which is being placed upon the cinema will fall upon the pockets of younger persons who cannot sustain such a burden. The consequence of this measure will be that cinema attendances will undergo an even sharper decline. That is a consequence that cannot be welcomed.

Under pressure from both sides of the House, entertainment tax was removed from the cinema precisely because it was felt that the cinema could no longer carry that exceptional burden. In effect, by imposing VAT on the cinema, the Government are reimposing entertainment tax. It is no good their saying that it replaces purchase tax and selective employment tax, because the impact of both on the cinema was very small whereas the impact of VAT will be very much greater.

Therefore, for the tiny mercy of these regulations we say "Much thanks" but we hope that the Government will think again and decide that there is nothing wrong, and nothing which other EEC countries have not done, in zero rating the cinema for VAT. I detest VAT and hope that it will disappear, but while it is with us, and while other EEC countries can zero rate the cinema and while we can zero rate books, there is no reason why we should not zero rate the cinema as well.

Obviously he cannot do so tonight, but I hope that the Under-Secretary will be able to tell us at a later date that, in view of the consequences of VAT on the cinema and the impact not only on exhibition but ultimately on production as well, the Government have decided that the game is not worth the candle and that VAT should be removed from the cinema altogether. Whether the tax will be carried by the industry or passed on to cinema-goers, and to what degree exhibitors will decide that they can carry it, time alone will tell, but I hope that the Government will soon conclude that the tax should not have been applied to the cinema and will remove it.

10.37 p.m.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

I have always had great sympathy for an industry like the cinema industry, which is suffering a continuous decline. It causes problems of adjustment. It always means a reducing total return and reducing employment. It is in the nature of the industry, however, that it is declining. I do not think much will change that situation in the immediate future, as far as I can foresee, because of the impact of television and other form's of entertainment, particularly television, which has caused the decline.

But I think that the industry does itself no good to overstate the problem which value added tax poses for it. The right hon. Member for Barnsley (Mr. Mason) and the hon. Member for Putney (Mr. Hugh Jenkins) have made too much of this. I believe that it is quite right that VAT should be placed on the cinema, as indeed upon all entertainment. If I have any sympathy with the hon. Member for Putney, it is that VAT was not placed on books. Perhaps it should have been, but to destroy the universality of the tax and its coverage right across the board and start making exceptions is the wrong way to look at it and will not do the raising of revenue any good—and that, after all, is an essential function of any tax.

I said that I thought the industry had overstated its case, as put through the right hon. Gentleman and the hon. Gentleman. First, the cost of a cinema seat includes not only the cinema but the distribution, processing and making of films. In these three processes there were considerable amounts of selective employment tax and some purchase tax, particularly in the making of films, which quite a lot of the articles bought by film producing companies must have borne. There is considerable saving to come from that direction.

Secondly, a lot of the materials bought for the making of films will carry VAT and this can be reclaimed as an input. To claim that the industry is faced with this straight 10 percent. increase is utterly wrong. It is misleading of the Opposition to give the weight of their authority to statements of that sort. The right hon. Gentleman went on to say that exports would be hampered. He ought to know that VAT is refundable on exports. The bulk of the industry's earnings, if it is to succeed and prosper, will come not from the British market but from the North American market. The only big cinema audiences left in the world today are in the United States.

We have the great advantage of sharing a common language. The opportunites for British film-makers are not, perhaps, great in the United Kingdom, but they are very much greater if we add to that the United States market. For the industry to be able to get a refund of tax on the biggest part of its market is a considerable opportunity which I did not hear mentioned by hon. Members opposite.

Mr. Hugh Jenkins

Will not the hon. Gentleman recognise, as the Chancellor has said, that the intention of VAT is that it shall be paid by the consumer? In so far as it is possible to absorb any part of the tax internally it will frustrate the intention of the Chancellor, who thoroughly intends that people going to the box office should pay an extra 10 percent. on the booking.

Mr. Ridley

I do not think my right hon. Friend intends that. We are talking about the change from 31st March to 2nd April, or whatever date we choose. Without any great change, costs and other factors being equal, there is first the purchase tax and SET point. Secondly there are the inputs which will come through. They cannot be claimed as an extra. Thirdly, with a successful film probably nine-tenths of the proceeds come from overseas earnings. This would mean that there would be a considerable reduction in the tax paid on the firm as a whole. Any cinema which puts a straight 10 percent. on a successful British film in Britain would indeed be making much greater profits than before.

Mr. Mason

The right hon. Gentleman is right on production about the inputs, the production tax and SET. He is wrong about exhibitions. Is it a 10 percent. imposition on exhibitions and on the exhibition of films. It is not possible to claim that purchase tax and SET are neutralising factors. As for the export side, I said that it would affect the export of films because I fear that there will not be the same finance forthcoming for production. Therefore the quality of films will be lowered, and that will affect exports.

Mr. Ridley

I agree that there is little purchase tax involved. Certainly SET would have been payable. I would have thought it was a significant element in the cost. By far the greatest part of the cinema seat cost arises from the cost of making the film. As for exports and the financing of films, the financier will not be deterred by the thought that the price of a seat in Britain may go up by a few per cent. He will be interested in the prospect of the film selling worldwide, or in the European or American market. What will make for a better film will be its prospects of selling worldwide. It is the low-quality films which do not get the bookings on the American circuit or in the rest of the world, and it will be these failures which the financiers will wish to avoid. I do not agree that this will affect the financing of films. If plans are put to financiers for films which have the potential to sell on a large scale, they will be willing to put up the money.

To blame the imposition of VAT in Britain at a rate which will probably represent an increase of less than 10 per cent. in the cost of a seat seems to be as far-fetched as one could go. I have no hesitation in supporting the imposition of VAT on films and in supporting these regulations.

10.45 p.m.

Mr. Joseph Ashton (Bassetlaw)

The hon. Member for Cirencester and Tew-kesbury (Mr. Ridley) spoke with the orthodoxy and lucidity of an accountant, but he was talking about a business with a far greater art content than the normal commercial business. He seemed to think that all films make equal profits. That is not so. Some films make big profits. but most make very little and sometimes no profit. I wonder how many cinemas there are in his constituency. In Basset-law, where 100,000 people live in 300 square miles, there are just two cinemas. There are some 10-year-olds in my constituency who, living 15 miles from the nearest cinema, have probably seen a film only two or three times in their lives.

Mr. Ridley

First of all, I am not an accountant but I am an artist. Second, I do not think that there is one cinema in my constituency.

Mr. Ashton

Then it puzzles me why the hon. Gentleman should have spoken as he did. I am arguing that the cinemas should be kept alive, whereas the hon. Member is telling us what we always suspected about this tax: that it is designed to ensure that the righ get richer and the poor get poorer or go out of business altogether.

My hon. Friend the Member for Putney (Mr. Hugh Jenkins) said that Eady money is not payable by cinemas taking less than £500 a week. Of the 77 cinemas that closed in 1970–71, 73 were taking less than £500 a week. If we exempt them from the levy because they are not profitable enough, why do we have to impose this extra 10 percent. on the lame ducks? Of 1,452 cinemas, 650 were taking less than £500 a week and 73 ultimately closed. Today the figure is rising: 834 cinemas are taking less than £500 a week.

The one ray of sunshine on the horizon has been knocked on the head. Many large cinemas have each been converted into two or three small ones, thus producing a total of 116 new cinemas. This useful innovation gets around the Eady money obligation, since one large cinema taking about £1,000 a week is replaced by two or three each taking £300 or £400 and thus they are not liable. At least this helps to keep the cinema alive and gives greater choice. The tax will have the opposite effect and will be spread more widely on these people.

At the breadline level just above that at which Eady money becomes payable —that of £700 or £800 a week—two-thirds of the existing cinemas are in jeopardy, especially in small urban or rural areas, above all in the poorer areas, where people are trying to keep a cinema alive not because it is part of the ABC or Rank chain but because it has been there all their lives and is part of their environment.

There is an ever-decreasing spiral, with fewer and fewer films making less and less money. So the number of imported films rises and, because they attract a less desirable type of client to the cinema, we get more permissive films, made on a cheaper basis. The Home Secretary says that many of the cinema clubs must be made to control their advertising, because it is an undesirable feature of the social scene, yet these clubs are growing while the legitimate cinema is declining.

No doubt to the Department of Trade and Industry an industry which earns only £34 million annually abroad is not very significant, but there is great value in the prestige those films earn for this country and the tourism they generate. The spin-off is greater than if we were selling £34 million worth of steel. These factors cannot be measured and should not be limited by the imposition of a 10 per cent. tax. If this view were generally accepted, other countries would not regard films as an art form.

I shall not read out the figures as my right hon. Friend the Member for Barnsley (Mr. Mason) gave them earlier; he may have had the same figures from the Film Producers Association. In France, Italy, Germany, Denmark and Ireland it is accepted that there is some artistic or educational content in the film producing business, just as there is in books and newspapers, and some concession is given as a result.

Another long-term aspect is the anomaly of VAT. That tax is not levied on BBC licences for television, much of which consists of old films. In about 10 years we will have a situation in which the number of films which can be shown on television in this modern society will have decreased, yet this ever-increasing burden is put on the film industry without any similar burden being placed on television.

I hope that the Minister will be able to examine some of the points we have made in this debate and that by the time of the next Budget the Government will give some sort of concession, otherwise we will get more and more of the "Carry On" and "On the Buses" series which are sure-fire winners for one or two cinemas in the big cities, but the small cinemas catering for select audiences will continue to have to carry this burden. I should very much like to see a change in Government policy in this respect.

10.52 p.m.

Mr. Anthony Grant

Although it is probably outside the range of the regulations to do so, perhaps I may make a few observations on VAT and the film industry generally. It is true that the industry made representations on the imposition of VAT. I myself saw the Cinematograph Films Council, and my right hon. Friend the Chancellor of the Exchequer listened extremely carefully to the case it made. My right hon. Friend was, however, unable to make a concession on VAT. I agree entirely with my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) who made the fundamental point that the more concessions we give in this respect and the greater the inroads we make into the VAT system, the more burdensome it becomes for the remainder and the less fairly it operates.

The right hon. Member for Barnsley (Mr. Mason) referred to the operation of VAT in European countries. We have decided on a single rate of VAT whereas those other countries have differential rates. In some countries the cinema is subject to a rate of VAT below the maximum. Both in terms of taxation and of aid to the industry one must consider the systems as a whole. We have our own support systems, now longstanding, including this levy, and one should not consider them or consider this levy in complete isolation. It has been the policy of successive Governments to continue these systems of support, and in this case the levy has played a significant part in placing British films, in the pre-eminent position in the world they now enjoy.

My right hon. Friend the Chancellor having made his decision, I can assure the House that the film industry is by no means as pessimistic as some hon. Members would have us suppose. Those in the industry, having made their representations, are now getting down to the problem of adapting themselves to the new circumstances. It is true that the industry has been going through a period of change for a number of years. Television is one factor, but there are other reasons for the change in public taste. I find now that there is a very strong feeling of buoyancy in the industry in the changed circumstances. There are different patterns of cinemas. There is a new style of two-tiered and three-tiered cinemas increasingly coming into evidence to meet the changing patterns.

I accept that the closures of cinemas has led to some parts of the country being isolated from the cinema. This is in accordance with natural trends, however, and people wanting to go to the cinema are prepared to travel further to do so. But I do not accept that anything which has happened has led to a lowering of standards in film making. Some of the films made in Britain today can compete anywhere in the world. As for our joining the EEC, the film industry not only welcomes our entry but feels confident that it can compete. I am certain that it can because I have always maintained that we have the best artists and technicians in the world. This is a factor which can make us really optimistic for the future, provided that we are as confident as the film industry is.

The right hon. Member for Barnsley asked a specific question about the amount of the levy. The total yield reached has been roughly between £4 million and £45 million in some years past. In the levy year ending October 1972, it amounted to £4.3 million. It is a little early to predict with accuracy what the yield might be in the current year. The figures to date are very slightly down on last year. However, the final yield should not show a significant drop.

The regulations are required only to preserve the balance between the various sections of the industry following the changeover to VAT. I believe that they do justice in that respect.

I do not go along with the gloomy forebodings of the right hon. Member for Barnsley about the provision of finance or about the future of the cinema as a whole. I agree with the hon. Member who said that the film industry is quite different from any other. It is. In some ways it is the flag of one's country. It is an industry of which we can be very proud. I believe that it will continue to export successfully throughout the world and that its name will continue to have the influence that it has had in the past and that it will have even more in the future.

The right hon. Member for Barnsley asked me to keep the trend constantly under review. Most certainly that will be done. I am in constant touch with the industry. But I should be doing less than my duty if I left the House with the impression that the film industry is in the depressed state which some of the speeches have portrayed. It is not. It is buoyant. It is a great industry with a very important future before it. As some contribution to that future, I hope that the regulations will be approved.

Question put and agreed to.

Resolved, That the Cinematograph Films (Collection of Levy) (Amendment No. 3) Regulations 1973, a draft of which was laid before this House on 26th March, be approved.