Leaving the EU: Tourism and the Creative Industries

Kerry McCarthy Excerpts

Tuesday 17th April 2018 Westminster Hall

[Mr Vaizey]

The hon. Gentleman makes an important point. When I was the Minister, I was struck by how regionally diverse the creative industries were, particularly the video games industry. There are companies engaged in that pursuit in Leamington Spa, Manchester, Liverpool and Newcastle. It is a challenge. Sometimes it is straightforward economics: people want to base themselves in London to have access to the widest possible range of services, but it is incumbent on us—I am sure the Minister will respond to this—to recognise the diversity and talent in our regions. The recent merger of Tech North with Tech City UK has created a UK-wide tech quango, which is focused on highlighting tech success stories across the country. Different parts of the country have different specialisms in tech—I am moving slightly away from the creative industries.

The hon. Member for Blackley and Broughton (Graham Stringer) makes a valuable point, and the same criticism is often levelled at cultural funding. I am chairman of Creative Fuse North East, a project led by Newcastle University, which analyses the symbiosis between tech and culture. It is important to remember that culture is often a generator for success in the creative industries, so we must maintain a strong focus on investing in culture outside London. I am glad that the Arts Council has made great strides in doing that in recent years. We are very successful, and the creatives industries are now high on the policy agenda. I should give credit to the Creative Industries Federation, which was created two or three years ago to lobby on their behalf.

Tourism is a hugely important industry—the fourth or fifth most important in our country—that depends to a great extent on culture and heritage. By investing in and supporting culture and heritage, the Government support our tourism industry. We launched the tourism strategy in 2010, when the then Prime Minister gave a speech supporting tourism. One of my great bugbears is that far too few Prime Ministers—that is, none—ever make speeches about the arts. I hope that the Minister will continue to press the case to our Prime Minister that she should give a speech about the importance of culture and the arts in this country.

Despite the hon. Member for Blackley and Broughton trying to cheer me up, I am thoroughly depressed about Brexit. The small silver lining, which is worth recalling, is that our biggest export partner outside the EU is the USA, with whom we do not have a trade deal. A lot of that export investment depends on the creative industries, such as the film industry and the video games industry. Many of those creative industries are global service industries that will not necessarily be hugely affected by Brexit, such as advertising, architecture and publishing, where we lead the world. It is incumbent on us—including depressed remainers—to continue to beat the drum for the global success of the UK’s creative industries.

[Kerry McCarthy (Bristol East) (Lab)]

The right hon. Gentleman is very much missed from his former role, but during that time we had many discussions about the difficulties that artists, and musicians in particular, have in getting visas for the US. Does he share my concern that after Brexit they will have similar problems across Europe? What can we do to ensure that does not happen?

[Mr Vaizey]

Yes, I do share the hon. Lady’s concern, but I must correct her: I do not think I am missed, because the new Minister is doing such an incredible job that he has wholly erased the memory of me. That is slightly irritating, but I am pleased that somebody as talented as him has taken on the role.

That concern goes both ways. The hon. Lady is incredibly perceptive, and I have worked with her very happily on many different issues. Talent is at the core of the success of our creative industries. If someone walks into the office of any successful business in any part of the country, they will hear a smorgasbord of different voices and meet people of a range of nationalities who have all been attracted by the success of the UK’s creative industries.

We simply cannot have a situation in which we make it as difficult as possible for talented people with the right skills to come to this country, and we must not find ourselves in a situation in which it is difficult for our successful companies to send their people abroad, whether that is a band of musicians or a team of people from an advertising or architecture firm. That must be at the front and centre of the Government’s thinking.

I was struck by an email I received today from a constituent, which is slightly tangential to the core subject of the debate. He runs a Brazilian management consultancy, which has an office in London because it believes in the openness of the UK economy. He cannot get a particular person with a speciality that would enhance the London business over from Brazil, and he has been trying for 12 months. It is a pathetic situation when the Home Office makes it so difficult for skilled people to come to this country and boost our economy.

The Minister should also keep an eye on the audiovisual media services directive. One of the UK’s success stories is that we have hundreds, if not thousands, of broadcasters based here, which can be regulated by Ofcom, the best communications regulator in Europe, and, as a result, transmit their services across Europe. As I was watching my BT Sport app in Europe last week, I was struck that, sadly, we cannot continue to take advantage of the digital single market, which allows portability for paid content. We will have to see what happens with that, but it is absolutely crucial.

The final hurdle—hon. Members will be pleased to know that I am coming to an end—is the French. They have carved culture out of every third-party free trade agreement between the EU and other countries. That was their No. 1 priority when the Transatlantic Trade and Investment Partnership was negotiated. As sure as oeufs is oeufs, the French will try to carve out culture in any free trade agreement between the UK and the European Union, and Ministers will have to be vigilant about the impact of any French agenda on the future of our creative industries.

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[Pete Wishart]

What we are now in the business of doing is finding solutions to mitigate the damage. The Minister will have to try and find ways to mitigate the loss of the optimal arrangements that we have in place now as members of the European Union. The touring passport is an example of how we can mitigate it. We are not going to get back to the ideal conditions. They have gone; for some reason, this Government are determined to pull us out of what is working for us, and is fundamentally and profoundly good for this sector. So arrangements will have to be put in place.

The hon. Lady will have seen the reports from UK Music, the Musicians’ Union and the Performers’ Alliance, which are all telling us that we are now in the position of trying to redress some of the damage.

[Kerry McCarthy]

What is important to consider when it comes to musicians and other creatives is that not everyone is from a huge money-making enterprise that can afford agents, lawyers and managers. It is the smaller musicians and, I would argue, the musicians in the better bands—rather than the Coldplays, Mumfords and Adeles of this world—who will really struggle with this extra bureaucracy, any extra cost and any difficulty that is put in their way.

There is also a particular concern about the European Health Insurance Card and people’s access to healthcare when they are travelling around Europe, which may also go out of the window. That is something else that may not be the most obvious thing for musicians, or actors, to worry about, but it will affect them.

[Pete Wishart]

The hon. Lady is absolutely right. The ending of freedom of movement will not impact that harshly on some of the bigger, multinational companies—the big tech giants that dominate the sector now. What it will impact on are the small and medium-sized enterprises within our creative sector. It will also have an impact on start-up businesses and it could result in impeding risk and innovation in the medium and long term, thereby hobbling the very drivers of our creativity.

It is profoundly disappointing that we are leaving the European Union. We will have to look for measures that will mitigate that, and that will ensure that we are aligned as closely as possible with EU partners. The thing that depresses me most is that we have carefully crafted and created this environment that lets our artists, creators, inventors and musicians succeed worldwide, and be the best in the world, and how we can so casually throw that away for nothing—absolutely nothing—disappoints me. It is something that I still hope we will have the opportunity to consider once again.

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[Chris Evans]

We have to pay them.

Last month I met Gail Renard, chair of the Writers’ Guild. She was one of several people who came to meet me to talk about concerns about the impact of Brexit on the creative industries. Gail is a very interesting character. She met John and Yoko at one of their famous bed-ins. As I am a big fan of the Beatles, our meeting went on from half an hour to two hours while she told me everything about John and Yoko and their fantastic life together. But the one thing she wanted to get across to me was the real concern about freedom of movement.

The Creative Industries Federation has recommended that the Government implement sufficient structures to replace freedom of movement. The problem for those of us who were remain Members of Parliament in leave constituencies is that when we knocked on doors we were told that the No. 1 issue was freedom of movement—we were going to take back control of our borders. As we have seen, not only in the creative industries but in others, we were told that there were simple solutions to complex problems. Many people did not know about access to the single market or the customs union. The issues were not properly explained, and that was the problem with the Brexit debate.

That is why we are where we are. The problem is that selling freedom of movement to our constituents will be difficult. When they see “freedom of movement,” they think about immigration. They worry about immigration, and that is a problem for a British success story. Let there be no doubt: the creative industry is a growing sector of the economy. It is worth £92 billion—up from £85 billion in 2015. The sector makes more than 5% of the UK’s gross value added product. However, all that would be impossible without European funding. If we are to lose funding from streams such as Creative Europe, as well as part of the workforce, when there is no more freedom of movement, the future of the creative industries looks bleak.

Earlier this year, entertainment industry leaders expressed concerns about freedom of movement and other post-Brexit uncertainties at a House of Lords Committee sitting. It is high time the Government listened to them. The chief executive of One Dance UK has said that freedom of movement is a vital part of its business model. Its members travel to the EU for work eight times a year, on average. A poll conducted by the Musicians Union when it held an event here a year ago with Equity found that only 2% of the music industry believed that Brexit would be good for them. An industry that produced the Rolling Stones, the Beatles and countless other bands that broke America is worried about the future. However, the key issue expressed across the industry is that, because of unique working patterns that involve a lot of travel, freedom of movement is necessary for its continued success.

I agree with the right hon. Member for Wantage that Prime Ministers have not discussed the arts very seriously. The creative industries seem to be a bolt-on. They are not taken as a major contributor to the British economy. The sector provides a wide variety of jobs and career opportunities for people across the UK and Europe. Harry Potter, James Bond and Marvel films have been some of the highest grossing productions of the past decade. Only this week Robert Downey Jr. was welcomed to south Wales for the filming of a new Marvel film. We want to welcome more people like him. Many of those productions have been filmed primarily in the UK and across Europe, with a significant British and European workforce. In 2016 alone there were 131,000 EU nationals working in the British creative industries. Freedom of movement for workers in the creative industries is key to the success of those projects.

If we lose freedom of movement, we run the risk of limiting the production of international projects in the UK. Can you imagine, Mr Bone, if that situation affected the banking, construction or manufacturing industries? I am sure that the debate would be packed with speakers, but the creative industries seem to fall to the back of the queue. It can go on no longer. If international film production companies or musicians using large European workforces believe that it will be too difficult or costly for EU nationals to enter the UK to work, they will simply go elsewhere. I agree with the hon. Member for Perth and North Perthshire that there will be countries in Europe, and around the world, rubbing their hands together waiting for the creative industries to leave here and set up there.

[Kerry McCarthy]

Is my hon. Friend aware of the EU quota rules by which at the moment TV broadcasters are required to invest 20% of their revenues in making or commissioning original content, and to spend at least 50% of their time showing European works? If British works are no longer included in that 50% quota, companies with a choice as to where they make productions will not come to Britain. They will need to make sure they are made in a European country.

[Chris Evans]

That is an extremely important point. What do we want to see on our television screens: low-budget foreign television productions or the high-quality drama and film productions we currently enjoy in this country? My hon. Friend the Member for Cardiff West (Kevin Brennan) will know that Wales has become a hub for BBC drama productions and for film, just as Scotland has—and Northern Ireland, with “Game of Thrones”. There is a real concern that we are almost gutting the industry.

There is also a knock-on effect. Music tours and festivals have a huge impact on larger companies but also on cafés, bars, hotels and other hospitality industries, and they attract huge crowds. We seem to be cutting our legs from under us. If limits are imposed, local enterprises will suffer. The Government need to ensure that there are either exemptions or sufficient structures in place to ensure continued employment and career growth for British and European workers in the entertainment and creative industries. The Government’s recent report on the creative industries gave absolutely no information on their plans for the sector’s future. The sector often has to plan out its projects far in advance, so it needs assurances now that its projects and workforces will not be hindered by our leaving the European Union.

There should be no doubt: there is a lot of money in the creative industries. Netflix and Amazon are competing for the same space; it is a great time for the industry. We must realise how important the creative industries are. Performing and visual arts, and film, TV and video are second and third respectively only to the IT, software and computer services sector. In 2015 those two sectors combined employed 517,000 people—20% of the entire creative industry workforce—and their economic outputs amounted to £24.4 billion, or 28% of the entire output. We cannot pretend that Brexit will not affect that. Many of those projects rely on freedom of movement. The Government should bring clarity to that.

I intervened earlier on the hon. Member for Edinburgh West. The Minister and I will probably bump into each other in the hallway tomorrow, as we are neighbours, and perhaps I can discuss the matter with him then. I would like the Government, if they take the creative industries seriously, to make two announcements. As I explained earlier, I would like officials from the Department for Digital, Culture, Media and Sport to be seconded to the Department for Exiting the European Union. I would also like the Culture Secretary to set up a Cabinet working group on Brexit, given the importance of the creative industries to the economy. Outside Parliament, I would like representatives of the creative workforce to be on the Creative Industries Council, which is currently chaired by John McVay of Pact. No creative trade unions are on it. I would like Equity, the Musicians Union and other creative industries unions to be invited on to it. The issue is too important. We are now perhaps 18 months away from Brexit. As in other areas, there is a need for certainty, and I look to the Minister to provide it.