Creative Industries: Creating Jobs and Productivity Growth

Lord Londesborough Excerpts

Thursday 6th February 2025 Lords Chamber

[Lord Londesborough (CB)]

My Lords, I too thank the noble Baroness, Lady Thornton, for securing this timely and topical debate. Productivity has become an obsession of mine ever since I became an accidental entrepreneur in the creative industries more than 30 years ago. I will say more on that in a moment, but first I welcome on board no fewer than three new Members of this House. I salute the noble Lord, Lord Brennan of Canton, for his excellent and thoughtful maiden speech; I much look forward to his creation of a new rock band in this place.

We have already heard how crucial our creative sector is to our economy in terms of GDP, jobs, growth and exports. That said, there are three areas of policy tension that I should like to highlight. First, I declare my interests as set out in the register, including chairing, advising and investing in a number of start-ups in the creative sector—I have the scars to prove it. These ventures range from film and theatre to online intelligence and a dog-lovers’ match-making platform. That is creativity for you.

I will start with government policy. It is positive that the creative industries are—quite rightly—one of the Government’s eight priority sectors, as is the announcement of £60 million of funding at the recent creative industries growth summit. But that pales considerably when set against the £2.8 billion increase in employers’ national insurance contributions that will hit this sector on 5 April—in two months’ time. It is especially painful for our creative SMEs, which will shoulder the heaviest increases because this tax on jobs now kicks in at £5,000 rather than £9,000 of each employee’s salary.

I have tabled amendments in Grand Committee for exemptions to this national insurance increase for all small businesses employing between 10 and 50 staff, which is the fastest-growing subsector of our creative industries. Given how competitive this sector already is, these measures will do serious damage, particularly to lower-paid jobs and part-time roles.

The second area of tension I should like to highlight is the need to protect IP and copyright in the face of AI and Web 3.0, yet at the same time embrace the opportunities, particularly to boost productivity, that these technology tools offer. For content generators, AI looks set to be a game-changer. I am already seeing its impact among the small, agile players, not just big tech. I encourage the Government to take a measured approach to strike that very difficult balance between protection, regulation, and growth.

The third and final area of tension relates to the original title of this debate, “Creating good jobs in every part of the country”. It is a noble ideal, but fair geographic spread of creative jobs across the UK is very difficult to achieve. Official data shows us that London and the south-east alone account for almost 70% of this sector’s GVA and more than 60% of creative jobs. Capitals and major cities tend to take the lion’s share in all countries, not just the UK. There is a natural clustering process in the arts and creative world that is often at odds with regional policies of levelling up. I simply advise the Government to be realistic in this regard, especially if productive, sustainable economic growth is their number one mission.