The House of Lords Communications Committee has issued a report saying that the UK’s creative industries should sit at the heart of the UK’s economic growth plans. However, it is alarmed about missed opportunities and a failure among senior figures among the UK government to recognise the sector’s commercial potential.
The report says that the UK’s creative industries were worth more than £115bn to the UK economy before the pandemic, and make up to one in eight businesses across the country. Their contribution to the economy in 2019 was more than the aerospace, life sciences and automotive industries combined. The sector also delivers higher levels of innovation than many other areas of the economy. However, countries across the world are competing for a slice of the lucrative opportunities in the sector: global exports of creative services alone exceeded $1 trillion in 2020. This is more than double what it was in 2010.
The Committee has drawn attention to the implications of technology-related disruption, and warns that the UK risks losing its leading position in this fast-growing industry. The Committee concludes the UK government has a major opportunity to put the creative sector at the heart of its future growth agenda but is failing to do so.
The report calls on the UK government to act on the following recommendations:
- Improve tax policy to boost innovation: The Government’s definition of R&D for tax relief is narrow and restrictive. It should be changed to include more of the creative sector. The Government should also benchmark other creative sector tax reliefs against international competitors to address the UK’s declining competitiveness.
- The Intellectual Property Office’s proposals to change the text and data mining regime are misguided and should be paused immediately. The proposals were intended to support the development of AI, and could enable international businesses to scrape content created by others and use this for commercial gain without payment to the original creator. This would threaten business models and income streams in the UK creative industries.
- Protect the UK's intellectual property framework. These protections underpin the success of the UK's creative industry exports. They must not be watered down when striking new trade deals.
- There should be a cross-government focus on skills shortages in the creative industries. The Department for Education should encourage students to learn a blend of creative and digital skills; improve careers guidance; reverse the decline in children studying design and technology; change what it calls "lazy rhetoric" about ‘low value’ arts courses; and make apprenticeships work better for SMEs in the creative industries.
- UK Research and Innovation should identify options to continue the most successful parts of the Creative Clusters Programme after March 2023. Discontinuing support would be a needless waste of a programme that is exceeding co-investment expectations by 600 per cent.
Our report sets out some immediate challenges that the Government can address now