§ The Minister for Consumer Affairs (Dr. Gerard Vaughan)
I beg to move,That the draft Films (Suspension of Quota Requirements) Order 1982, which was laid before this House on 7th July, in the last Session of Parliament, be approved.The draft order has been considered by the Joint Committee on Statutory Instruments, which made no comments.
My hon. Friend the Under-Secretary of State for Trade is extremely disappointed that he is not speaking tonight on an order of which he would gladly claim to be the architect, as in the Government he normally carries day-to-day responsiility for the film industry.
The only, but very important, reason why my hon. Friend is not in my place now is that he had to leave for Brussels immediately after the conclusion of the last vote to attend the Council of Ministers. First on its agenda today the Council will debate and we hope come to a conclusion on inter-regional air services, which are vital to our regional airports. I know that the House will understand the circumstances that have brought about my hon. Friend's absence.
I am glad to bring the order before the House, as the regulations will alter a matter that is important for our cinema industry. Some hon. Members may be concerned about the implications of the order, and I fully understand why, but if they consider the overall situation facing our industry they will wish to approve the order.
The quota system was introduced in 1927 to encourage the growth of a viable British film industry and to protect it, mainly from a flood of American films. It required cinemas to show British films, or, since 1973, European Community films, for a percentage of their total screen time.
Originally, the percentage was 12½ per cent. In the early 1940s it was increased to 15 per cent. In 1948 it was raised to 45 per cent., but in 1949 reduced to 40 per cent. In 1950 it was again reduced, to 30 per cent., and this year it was reduced to 15 per cent. The order will suspend the quota altogether. Those figures alone give some hint of the problems facing the industries concerned.
The situation for our cinemas and film industry has changed radically since the quota was first introduced. In the late 1940s, 1,500 million people went to a cinema every year. This year the cinemas will be very lucky if they attract 65 million. At present the figure is just over 40 million—down by about 50 per cent.
In the 1940s, American film production for long films reached around 250 a year, and United Kingdom films numbered 80 to 90 a year. This year American film production looks like being something less than 100 films, and to date only 25 United Kingdom long films have been registered.
I should add to that the number of cinemas that are closing down and the number that are running at a loss. Many of the independent cinemas manage to make a small profit only by the sale of sweets and so on. Even within the circuits, a number of cinemas are being carried at a loss. The industry will not be able to do that for long. When we consider those aspects, we begin to see the extent of the crisis in our cinema industry.
441 It is against that background that the Government felt obliged to re-examine the quota question less than a year after the new quota was fixed at 15 per cent., when it was anticipated that it would continue for at least two years. We have come to the conclusion that in many cases the quota is unattainable, although on average 30 per cent. of films shown are still of British origin.
Last year 24 per cent. of cinemas failed to achieve their quota and no action was taken against them. Although there are penalties for failure to achieve the quota or to make a return, in practice no prosecutions are made. That is because under the Cinematograph Films Act 1960 it is a defence if the exhibitor can show that it is not commercially practicable to exercise the quota.
§ Dr. Vaughan
No. I intend to speak briefly, in view of the time.
The presence of the quota means that some cinemas struggling to survive and trying to achieve their quota put on films that are substandard. That is undesirable. In fact, it joins in the vicious circle of decreasing cinema attendances.
There is also the sheer administrative burden that the system imposes on the cinemas, with the need to keep a quota record book in which all details of films are shown and entered week by week, including the playing time of each film. At the end of the year these books, duly certified, are forwarded to my Department where they are checked for accuracy and quota achievement.
All this takes a monumental amount of time, money and effort. It is questionable whether it is right to add to the burdens of an industry that is already in difficulties.
§ Dr. Vaughan
No, I intend to be brief, because I know that a number of hon. Members want to speak and the hour is late.
After re-examining the situation and consulting the Cinematograph Films Council, we have concluded that the economic position of the cinema is so poor that immediate action to remove the quota is essential.
Following removal, we do not expect to see any dramatic change in the showing of British films. In many ways it may help. In fact, the low, overall number of films at present available will place the British film industry in a strong position, and the favourable tax regime over the next two years should also increase the proportion of British films that can be made and shown.
I appreciate the arguments of those who wish to see a screen quota continued at a high level, but the industry must have the courage to face the changed circumstances. No one can pretend that video, cable and satellites will provide an overnight solution to the problems of the film industry, but if we can control piracy and regulate new outlets satisfactorily, that could present a real opportunity to our film industry. Equally, we do not feel that we can stand by and simply ignore the plight of our cinemas and the considerable number of people who work in them. They require help, and the suspension of the quota system is one small step that we can take to assist. I therefore commend the order to the House.
§ 3 am
§ Mr. K. J. Woolmer (Batley and Morley)
I cannot agree with the Minister that it is excusable for the Under-Secretary of State for Trade, who has responsibility for the film industry, to be away for the second time running when the House has considered matters that affect the film industry. The order was tabled on 7 July. It is as a result of incompetence that it has not come before the House until so near Christmas and that the Under-Secretary of State for Trade cannot be here to introduce the measure.
The Under-Secretary of State announced months ago that he was conducting a review of the film industry. He owes it to the House to explain what he is doing. The lateness of the debate cannot be regarded as an excuse, either. The film industry is being given shabby and inadequate treatment.
I was appalled that the Minister could not give way to the sensible points that would have been raised while he spoke. It is obvious to anyone who follows the subject what points would be raised. I put it to the hon. Member for Romford (Mr. Neubert), who is muttering from a sedentary position, that his hon. Friend the Under-Secretary of State should have been here to answer for himself. I hope that he will be here next time we debate these matters.
It is less than 18 months since the right hon. Member for Gloucester (Mrs. Oppenheim), who was then Minister with responsibility for the film industry, introduced the measure which reduced the quota for first feature films in cinemas from 30 per cent. to 15 per cent. In justification of her decision, the right hon. Member for Gloucester said:The reason I am keeping the quota … is that I wish to show some support for an industry which I accept. The way in which the film industries are being encouraged to grow is finding out how to increase the amount of money gained from the Eady levy to provide money for the industry. That is the constructive way forward.As the Minister said, less than 18 months later, we are presented with a proposal to abolish the quota altogether, still with no sign of ways of meeting the positive needs for finance that were recognised then.
The charge that I lay against the Under-Secretary, which is reinforced by the fact that he is not here, is that he has shown a cavalier disregard for the interests of the industry in the intervening period.
The speech of the right hon. Member for Gloucester also showed that the Eady levy and other sources of finance were linked, in the Government's approach, to reducing the use of quotas and other instruments of film industry policy. The prospect of extra sources of finance was held out as a balance, to be held against the reduced protection by reducing quotas, yet we are presented with a proposal to abolish film quotas without being given any information about where the extra finance and positive policies to offset the reduction in encouragement are to come from.
What progress have the Government made in expanding the Eady levy or the sources from which it is drawn? The right hon. Member for Gloucester, as the Minister responsible for the film industry, said on 28 July 1981:I am impressed by the arguments that exhibitors of television films, of whatever form, should contribute to the levy. I undertake—as I have undertaken to the industry—to give further consideration to this matter and consider in what way that idea 443 might be implemented, to the advantage of the industry as a whole."—[Official Report, Second Standing Committee on Statutory Instruments, &c., 28 July 1981; c. 25.]Having hit the industry with a stick by reducing quotas and now abolishing them, the Minister held out the carrot of extra finance. The question is, "What has happened to that promise?" Why, when quotas have been reduced and it is now proposed to abolish them, has an undertaking to examine additional finance as compensation not come forward?
The Opposition did not trust the then Minister's stick and carrot approach 18 months ago. We trust the present Minister even less. The House and the film industry have plenty of reasons for distrusting the Minister and his motives. The order was first tabled on 7 July. Since then, the Minister has announced that he is undertaking a major review of the film industry. The review has apparently been dragging on without anyone being clear what are its terms of reference, and its objectives. It is not good enough for one form of support for the film industry to be taken away without showing how this accords with an overall approach and policy. It is like lopping off a limb without showing what will be put in its place.
My mistrust and that of many hon. Members was heightened by the inspired or apparently planted leak in the Financial Times on 8 November when it was suggested that the Eady levy, far from being expanded, might even be scrapped and that the National Film Finance Corporation, instead of being expanded, might be wound up. The timing of the leak shows the insensitivity of the heavy-booted style of the present Minister.
The leak came only three weeks after the Select Committee on Education, Science and Arts had published its eighth report in which it recommended the extension of the Eady levy to cover films shown on television. It also recommended the reorganisation and expansion of the role of the National Film Finance Corporation. For the leak to appear within so short a period showing that the opposite was in the mind of the Minister was, to say the least, insensitive. It showed that the House cannot take at face value any assurance that abolition of the quota fits into any positive intention to support the film industry.
If hon. Members are to judge the thinking behind the policy to abolish film quotas in cinemas, the Minister should give the House clear answers to some crucial questions. What does his review of the film industry cover? When will he make the findings public? Does he also intend to abolish the film levy, or will he extend it to cover television and video cassettes? Does he intend to wind up the National Film Finance Corporation, or will he strengthen and expand its resources and scope? Will he respond to the Select Committee on Education, Science and Arts, which deals in a refreshing and challenging manner with film industry policy?
We oppose the abolition of the film quota today for a number of reasons. First, we believe that to abolish the quota without providing in its place clear counter balancing support and positive encouragement to the film industry can only damage rather than assist the industry.
Secondly, no evidence has been produced to show that a quota of 15 per cent. or even 30 per cent. is damaging the industry as a whole or the cinemas. Indeed, in my view the distributors and cinema exhibitors have a great deal to answer for in their own unimaginative and unenterprising promotion and development over the years. They should not be allowed to get away with giving the impression that 444 somehow the cause of all their problems is the need to show at least 15 per cent. British films. That would imply an abysmal ability on the part of the cinema industry to sell itself.
Thirdly, it is entirely premature to abolish the quota when a major ministerial review of the film industry is already well under way. It is the total package of public policies that will matter for the industry. What I have described as a piecemeal hacking off of limbs is no way to encourage its survival and growth.
Fourthly and lastly, I oppose the abolition of quotas today because the existence of the cinema-based film quota is an important principle which needs to be considered in relation to evolving Government policy regarding the exhibition of films on conventional television and, in due course, satellite and cable television. There has been widespread concern about the Hunt report on cable systems, which said that a requirement to show a large proportion of British material was inappropriate and would seriously inhibit cable operators.
What is the Minister's position on this vital issue for the British film industry? In abolishing the film quota in cinemas he presumably believes that the quota is of no value in assisting the British film industry. I disagree with that, but if he takes that view does he take the same view of quotas or proportions of British material shown on conventional television or, in due course, on cable television?
The Hunt report on cable proposes a dangerously monopolistic combination by permitting cable companies and programme companies to be under the control of a single company. In addition, its recommendations would permit such companies to be in foreign ownership. I can think of few things so dangerous to the public interest or to the interests of the British film industry in this new and developing medium of audio-visual communication.
I have tried to explain why I believe that the abolition of quotas in cinemas now is relevant to the view implied for the future about the quota system that applies de facto in relation to television and is an important issue in relation to the evolving technology. Has the Minister assessed those matters? Will they be part of the assessment of the film industry review now taking place?
The film industry has been going through a period of turbulence, change and challenge. No one can deny—I certainly do not—that changes have been needed in many areas to reflect the changing social, economic and technological milieu of recent years. The changes required involve the various parts of the film industry itself as well as a review of Government policies. What is needed from the Government is a sense of purpose to back both the cultural and the commercial objectives of our film industry to bring together the many parts of the film, cinema, television, video and emerging cable interests to provide a new, sounder financial and regulatory base upon which to build and to make the best of the talents and opportunities available to us.
I agree that matters cannot continue as they are. Times have changed dramatically since British cinemas had audiences of 1½ billion in the 1940s. Today the figure is less than 70 million. Conventional television now dominates viewing, but already video recorders and cassettes are threatening television viewing figures as well as being a new threat to the cinema. Within two or three years, more people will he watching films on video than 445 in the cinema. Cable television will become a significant force during the next 10 to 15 years, or perhaps earlier. That shows the irrelevance of this order.
It will be a disaster for the film industry if the quota system is abolished this week, the levy is abolished next month and the National Film Finance Corporation is closed the month after that. All those actions will come piecemeal, one on top of the other, with no positive action and no new finance for the industry. The film industry policy requires a fundamental review. I wholeheartedly agree with that, but it must not be a review that leaves the industry in the meantime faced with a void and a period of total confusion. We now need a period for thought, at the end of which there should be a clear and positive set of proposals that offer support and action.
This order is ill-timed and irrelevant to the real needs of the film industry. I urge the Minister to put away the hatchet and to bring before Parliament comprehensive and forward-looking proposals that measure up to the needs of the future of what should be a thriving film industry.
§ Mr. Peter Griffiths (Portsmouth, North)
I wholehear-tedly support the order before us tonight, because, although I yield to no one in my desire to see a viable British film industry, I am concerned that there should also be a successful and vigorous cinema and film exhibiting industry. The hon. Member for Batley and Morley (Mr. Woolmer) used the word "irrelevant" to describe the order, but he should have applied that word to the quota, which has become more and more irrelevant in past years.
There was a time when the cinema attracted massive audiences. At that time, a proportion of the films shown meant, more or less, a proportion of the audiences. It does not mean that today. People go to the cinema now much less frequently and they are far more discriminating. They choose the films that they wish to see and the deciding factor is not whether the film is made in Britain, on the Continent or in the Unied States of America. The important factor is whether the film offers the entertainment or pleasure that the individual who is going out for the evening is prepared to leave his home to seek.
Britain can and does provide films that are the equal of those produced anywhere in the world. However, those who are best qualified to judge which films will meet the needs of the local audience are the exhibitors in the area. I am advised that the cinematograph exhibitors wholeheartedly support tonight's order. The hon. Member for Batley and Morley spoke about the abolition of the quota, but I am not sure whether that is what we are discussing. We are talking only about a suspension of the order. However, I ask for its abolition as soon as possible.
We have learned in one industry after another that it is the task of British industry to produce goods that are saleable in direct competition with those produced elsewhere. To try to provide an artificially protected market is likely to have only a depressing effect on the quality of the product. We have seen that in more than one industry.
The British film industry can meet the challenge that is placed upon it. Perhaps there are cultural and social reasons why the film industry must survive. Perhaps there are reasons beyond simple commercial viability. If that is so, we should look to the financing of the production of 446 films and not place restrictions on the exhibitors who are already having a difficult enough time in attracting audiences into their cinemas.
The order is sound and sensible. It shows that the Government understand the social changes that have taken place over the years. It reflects the fact that we have confidence in the British film industry and that its future success is dependent on its ability to compete on its own merits.
§ Mr. Bryan Magee (Leyton)
The order does no more than come to terms with the inevitable. I shall go further and say that it comes to terms with an already existing situation, as the Minister conceded in some of his remarks.
As the Minister reminded us, the quota has existed since 1927, but its flourishing years were very different years for the cinema from today. When you and I were young, Mr. Deputy Speaker, cinema programmes were customarily about three hours long. In addition to the major feature, there was a supporting feature and then often a travelogue, a newsreel, a cartoon and perhaps even a documentary—it was normal for there to be half a dozen elements in a standard cinema programme. Most of the major feature films that were shown were American, but the British quota was always made up substantially of that supporting material.
The nub of the problem is the change in programming, so that we now just have the main film and often little else—in fact quite often nothing else, except a few advertisements. Programmes of the kind that the British quota used to help fill year after year have for the most part ceased to be shown in our cinemas.
There was never a mass audience in many parts of the country for a large number of major British features. We have always produced some feature films that were as good and popular as any others, but we have never come remotely near producing as many as the demand in our own country called for.
I detected awareness of all this behind some of the Minister's remarks. When there was no longer the British material to fill the quota that the public would go and watch, the imposition of the quota started keeping audiences away. It was a paradox: a measure that had been introduced to promote and foster the British film industry started doing the industry positive damage and accelarating its decline.
In recent years the quota requirement has been flagrantly disregarded. The law has simply been broken in many areas. The Minister showed that he was aware of that, and indeed acknowledged that it was policy not to prosecute in such cases. Cinemas and other exhibitors have also resorted to legal ways of getting round the law, for example by turning themselves into clubs, which is increasingly common nowadays, and one of the reasons for which is that it frees the exhibitor from the quota requirements. We have reached the point where the quota is at best irrelevant and at worst positively harmful.
The ACTT is in favour of preserving the quota, but that only shows the short-sighted protectionism that often characterises trade unions in a difficult period. In other industries, too, trade unions get into the same vicious circle of trying to encounter a recession with protectionism, which results in loss of competitiveness, which accelerates still further the recession, as the hon. Member for Portsmouth, North (Mr. Griffiths) said.
447 The way out of the situation is to encourage growth in the film industry. The key to this is the financing of films. We are already seeing the beginning of a renaissance in the industry. In the past year or two we have turned out magnificent films in increasing numbers.
The one event that could transform the situation more than any other is the opening of Channel 4. My information is that it plans to commission about 40 feature films a year and that it has already put the first year's worth into commission. That will transform the employment situation in the entire industry. It is far more important than maintaining the quota. More can be done in other directions, too, such as refurbishing cinemas. The industry is increasingly aware of that.
So I support the measure. The quota is irrelevant, and indeed could profitably be abolished.
But I also support what the hon. Member for Batley and Morley (Mr. Woolmer) said about cable. That is where we really need a quota. If we do not have a quota for cable we shall be swamped by American rubbish. The major American film producers could not believe their eyes when they saw the Hunt report. They could not believe their luck. Not even America's closest geographical neighbours and economic dependants, such as Mexico and Canada, are laying themselves open to the cable-colonisation tht the Hunt report recommends. It would be disastrous for the Government to go down that road.
A final point. If, as the order proposes, the collection of statistics about the industry is suspended, will there still be provision for the ongoing flow of hard factual information which is fundamentally important to the industry? I urge the Minister to make alternative provision for the continued flow of statistical information.
§ Mr. Tim Brinton (Gravesend)
I support the Minister in suspending the quota. It is in an overdue act. For some time the quota has not helped the exhibition of films.
The hon. Member for Batley and Morley (Mr. Woolmer) stressed the need for total reform of the British film industry. I thank him for his compliments on the Select Committee report. I am proud of it. I believe that we achieved something with that report.
I welcome the Minister's review of the film industry. There are many problems which involve more than his Department. We have to look at the responsibility of broadcasting the Department of Educations responsibility for films and the disparate branches of the NFFC and the CFC. The problems must be solved in a way which will suit the end of the twentieth century. The industry grew like Topsy in its early years, and all the regulations are out of date.
I am not in favour of a British film authority, but I am in favour of making the Eady money realistic. That means charging the audiences that have left cinema and watch films on the television or video cassettes, and who will in the future watch them on cable. That will have to be done if the Eady money is to be of any use.
I cannot agree with the view that the Eady levy must continue at its present level and be obtained from the cinemas. That will not provide enough money to sustain a proper British film industry.
I ask that the review should pay attention to what is probably the gravest problem facing the British film industry. I am on the periphery of the production side and know that the film producer finds it difficult to relate to 448 the skilled merchant banker in the city. A bridge must be built between those two if we are to have satisfactory investment. There are signs, not least in the Goldcrest company, that that is beginning to be done in a sensible way. It is something that we must foster if we are to have a viable film production industry.
I hope that the quota will be suspended. However, do not let us act in a piecemeal fashion. Let us act consistently.
§ Mr. Tom Clarke (Coatbridge and Airdrie)
It is true, as has been said by almost every speaker in the debate, that the British film industry is facing difficult times. However, anyone who imagines that the suspension or abolition of quotas will solve the problem is misguided.
Many people who have given their lives to the British film industry and those who want to see the growth of cinemas are anxious about what is happening in Great Britain today. The pattern does not encourage those of us who are interested in films and the cinema.
We had 102 cinemas in Scotland in 1980. This year there are fewer than 100. Last week the closure was announced of the only cinema in my constituency. In the constituency of the hon. Member for Galloway (Mr. Lang) the one cinema that serves people within a 50-mile radius was about to close but it was saved by the excellent efforts of the community at Newton Stewart. The community did its utmost to make the cinema available.
I congratulate local authorities, such as mine in Monklands district, which are attempting to expand their mobile cinema service to replace the cinemas which are being lost because of the present patterns in the film industry.
The quotas go back for some time and they have varied over the years. When my right hon. Friend the Member for Huyton (Sir H. Wilson) was President of the Board of Trade, the quota stood at 45 per cent. That was helpful, and I understand that there was no disagreement about it at that time.
In our last debate in July we were promised that there would be a review in the autumn. I and other hon. Members understood that it would be a global review. However, no such review has taken place. Tonight we are presented with a unilateral action which may please some sections of the industry—certainly those who are responsible for exhibiting films—but it will not please the people on the production side. Although exhibitors may feel that this will be an end to foreign films, bureaucracy, and so on, the fact is that unless we commit ourselves to production, and unless we believe that there is a strategy that will lead to a greater production of films—British films, in particular—they will face problems that they do not envisage at present.
My hon. Friend the Member for Batley and Morley (Mr. Woolmer) properly referred to the article in the Financial Times of 8 November and to other suggestions that have been made, as far afield as the United States, where in the magazine "Variety" it was said that the Minister apparently feels that there is a case for removing the Eady levy. In the absence of the promised review, the House is entitled to know the Government's intentions. A decision to abolish the Eady levy would have substantial and—to many people—unacceptable consequences. It would have a sizeable influence on the activities of bodies such as the British Film Institute and the National Film 449 Finance Corporation itself, in a year in which we have been proud of production of films such as "Gregory's Girl". It should be remembered that that film would not have been possible if it had not been for the Eady levy. There are other implications, not least for the National Film School. That school does a first-class job. We should not leave those people in doubt about their future and about their contribution to the British film industry. I hope, therefore, that the matter will be clarified as soon as possible.
I had some difficulty in following the argument of the hon. Member for Portsmouth, North (Mr. Griffiths), who suggested—if I understood him correctly—that if we remove quotas we remove the possibility of inferior products. The argument was taken up by the hon. Member for Leyton (Mr. Magee). Having supported that argument in respect of films, the hon. Member for Leyton then argued for the same policy to be applied to cables. I see no logic in that. However, we are entitled to say that quotas were introduced and sustained over the years. There are some good British films. If we have no protection—incidentally, we would be one of the few countries in Europe to deny ourselves that right—some good British films will not see the light of day. The market will be flooded with American films, and no one will convince me that all American films are of high quality.
The other day the magazine "Film Directions" said, and it is important to draw it to the attention of the House:Unfair comparisons have, in the past, been made with the renascent German Film Industry, the newly established Australian Industry and the emerging New Zealand Industry. A new lease of life needs to be urgently injected into the British Industry—the Levy, on its own, will not do this—and new policies need to be quickly formulated or else we will all be talking and writing about the British Film Industry in the past tense".I do not disagree with that.
We must all consider the British film industry to be important. I take into account the views expressed by my hon. Friend the member for Batley and Morley. A Select Committee has made a recommendation about ministerial responsibility. There have been great areas here which have not been helpful either to the House or to the industry. I hope that the review of the British film industry will take place in the near future. I am sure that the House will remember that there are many organisations and individuals who have given a great deal to the success of that industry.
In conclusion, I say that the Scottish film archive has a clip of an interview with the late Scottish comedian, Will Fyfe. He related how, while he was in the United States, he had had to undergo an operation. He said that when he awoke afterwards he looked around the room and saw that all the curtains had been drawn. So Will Fyfe turned to the surgeon and asked what was the meaning of that. The surgeon said that while he was operating the hotel across the road had caught fire and they had not wanted him to wake from the operation thinking that it had not been a success.
I fear that when the Minister and his colleagues awake to what they have been attempting to do tonight they may well feel that they have been fundamentally unsuccessful. However, I still urge them to undertake the global review of the British film industry which I believe will be essential to its growth and its success.
§ Mr. Clement Freud (Isle of Ely)
I support the words of the hon. Member for Coatbridge and Airdrie (Mr. Clarke). All hon. Members will recognise that the British film industry has produced some of the great films of the world. We have recently produced in "Chariots of Fire" and "Gregory's Girl" two of the best films in recent years.
I had not intended to involve myself deeply in the debate. However, as the Minister did not give way, and as he began by saying that the order is important for the future of our cinema industry, I thought that I might just say a few words. The order is not important for the future of our cinema industry. What is important for the future of our cinema industry is for the Government to support and encourage it. What always happens is that a Government appoint one of their elder statesmen to head a committee and by the time he reports the other party has got in and takes no notice of what that elder statesman has said. May I suggest that if the Minister is to set up a committee he might appoint as chairman a Member of the Liberal or Social Democratic Parties? In which case, the Government will take notice of it when it reports.
§ Mr. Freud
The hon. Gentleman should wait until he can see the political complexion of the next Government.
My point is that the order is not important for the future of our cinema industry because the quota has been flagrantly disregarded and nobody has ever been fined for doing so. The sheer administrative burden might well be there, but if someone does not fill in his forms in triplicate and xerox 32 more copies to send to whomever, there is no prosecution either. Therefore, we are fiddling with something that is astonishingly unimportant.
The argument in favour of a quota has tended to be that nowadays people go to the cinema to see blockbusters. A few people go to see whatever is on. While cinemas stagger from one mediocrity to another waiting for the blockbuster, such mediocre films as they show may just as well be British. That is a resonable argument in favour of a quota. I do not think that we shall insist on it, because I am sure that it is right to say that the quota is not important. However, it is important that the cinema should have support.
When the Minister sums up, I hope that he will make two announcements. First, I hope that he will tell us what will happen to the Eady levy? I believe that the whole House agrees that it is important that it should be retained and that it should have the Government's support. Secondly, will the Minister talk to us not about the quota for cinemas—which is reasonably irrelevant—but about whether the quota for cable television is to be invoked and helped?
§ Dr. Vaughan
I shall reply briefly, while endeavouring to answer as many questions as possible. However, I undertake to answer in writing any points that I miss out if hon. Members so wish.
The debate has been thoughtful, important and certainly constructive. It has shown clearly that, while several hon. Members support the suspension of the quota and some hon. Members would prefer its abolition, there is a general 451 feeling that we need—as the hon. Member for Coatbridge and Airdrie (Mr. Clarke) said—to take a global view of the film and cinema industry. The Government accept that. However, I do not accept the references made by the hon. Member for Batley and Morley (Mr. Woolmer) to the absence of my hon. Friend the Under-Secretary. On reflection, he may consider some of his remarks to have been misplaced. I was rather disappointed that he largely concentrated on the problems of the film industry. Those problems are real, but we are discussing the problems of the cinema.
I agree that the film industry is in trouble, although it is nothing like the immediate troubles that we face with the cinema industry. I was very glad when my hon. Friend the Member for Portsmouth, North (Mr. Griffiths), the hon. Member for Leyton (Mr. Magee) and my hon. Friend the Member for Gravesend (Mr. Brinton) put the debate into perspective once more. We were in danger of discussing the film industry and forgetting the subject of tonight's debate.
The hon. Member for Batley and Morley rightly referred to the former Minister, my right hon. Friend the Member for Gloucester (Mrs. Oppenheim), and to her examination of the issue in 1980. He will know that she seriously considered at that time the suspension of the quota. Because of the uncertainty of the views put to her then—which we do not receive today—she decided that the quota should be continued, at least for the time being.
I imagine that the House will want to debate the Eady levy and other aspects of the film industry at a later date, because a full debate is required for that. However, last year the Eady levy raised £6 million. Currently, the figure is about £4.3 million. We think that the 1982–83 figure will be as low as £3.5 million. This is directly related to the fall in attendances and the problems of the cinema. If the hon. Gentleman is saying that because of the need for the levy and the falling figures we must take the matter seriously and examine the financing of the film industry, I agree with him. My hon. Friend the Under-Secretary of State for Trade is undertaking this and is as anxious as anyone that it should be completed as quickly as possible. It will be a global review.
For various practical reasons, I had to agree to the delay of the report of the Monopolies and Mergers Commission. I regretted that very much, because it is most important that we assemble the information and get on with whatever steps are necessary.
I welcomed the remarks of my hon. Friend the Member for Portsmouth, North, who referred to the need to avoid artificial protection. He referred to financing. The financing of films has changed. For example, films such as "Superman" and "The Empire Strikes Back", which come within the quota, are internationally financed films with a guaranteed distribution and would not benefit from the quota.
§ Mr. Woolmer
Before the Minister finishes discussing the cinema part of the industry, what are the Government's intentions about the levy? If he seeks to assist the cinemas, it is logical that he will seek to abolish the levy. One could not abolish the levy, to help the cinema without damaging the rest of the film industry. There is a connection between what one does for the cinema and what one does elsewhere. Do the Government intend to abolish the levy or do they intend to go along the route of the Select Committee to widen the levy and overcome this gross 452 injustice whereby hundreds of millions of viewers every year watch television and see films virtually for nothing while in the cinema a smaller number of people pay that financial contribution towards developing a film industry which enables the films to be produced? What do the Government intend to do?
§ Dr. Vaughan
I was about to say, before the hon. Gentleman intervened, how glad I was to hear the hon. Member for Isle of Ely (Mr. Freud) in his rather mixed continents, referring to "Chariots of Fire" and the excellence of our film industry. It is that type of skill that has attracted so much money from other parts of the world into our film industry and makes it so artificial to have an imposed formal quota.
With regard to the Eady levy and the review of policy, it is clear that hon. Members have seen some of the dramatic press reports on the subject which have suggested that my hon. Friend the Under-Secretary of State had decided to abolish the levy. That is not the position. It was merely one of a wide range of options that have been put to him, including the option of extending the levy to television and video. My hon. Friend will be happy to have representations from those who have the benefit of professional experience. He asked me to make that clear to the House. I know also that he hopes to reach some conclusions early next year. We must get on with it urgently.
Several hon. Members have referred to cable and the quota. As they will know, my right hon. Friend the Home Secretary said on 2 December that the Government were giving the matter serious consideration but had not yet come to any conclusions.
§ Mr. Woolmer
The Minister has referred to quotas on cable. Although this may be the ministerial responsibility of the Home Secretary, it is clearly important to the film industry. Is the Minister with responsibility for the film industry expressing a view on behalf of the industry to the Home Secretary? If he is, what is that view? The House has a right to know and I am sure that the industry has too. Does the Minister have a view on television and cable quotas?
§ Dr. Vaughan
I think that the hon. Gentleman will realise that I cannot go further than that which I have said tonight. During the debate on cable systems on 2 December my right hon. Friend the Home Secretary said that the issue would be studied by the Government and the House with the greatest care.
The hon. Member for Leyton talked about statistics. I understand that none of the regular flow of statistics is exclusively dependent on the quota system. The Eady levy system, for example, provides a number of important figures. The cinema inquiry, which is carried out annually by the Business Statistics Office, provides the material in the Business Monitor. It is important that we know what is happening in the industry.
The hon. Member for Coatbridge and Airdrie referred, rightly, to the problems of the National Film School. We are conscious of them and this is one of the reasons why my hon. Friend the Under-Secretary of State has made special provision for its part of the quota to take priority over the other beneficaries' quotas. This is another matter that will form part of his general review.
I was glad to hear my hon. Friend the Member for Gravesend say that he was not in favour of a British Film 453 Authority, because nor are we. We agree that it is essential for the film industry to develop new ways of encouraging private investment. The more that we can encourage it in that direction the better.
This has been a wide-ranging and constructive debate. I shall be glad to take up any matters that I have overlooked. I commend the order to the House.
§ Mr. Freud
If the Minister wishes to be constructive and to help the cinema industry, will he announce here and now that the overwhelming burden of administration which he believes cinema owners and exhibitors carry in completing his forms will be scrapped as from now instead of from some date next year?
§ Dr. Vaughan
We are discussing a measure that suspends the quota. I do not feel that hon. Members would want me suddenly to go further than the measure that is before us.
§ Question put and agreed to.
That the draft Films (Suspension of Quota Requirements) Order 1982, which was laid before this House on 7th July, in the last Session of Parliament, be approved.