Committee
Economy, Energy and Tourism Committee 09 March 2016
09 Mar 2016 · S4 · Economy, Energy and Tourism Committee
Item of business
Creative Industries (Economic Impact)
Thank you, convener. If this is indeed the committee’s last meeting, I should thank the committee for its on-going interest in the creative industries and acknowledge the committee’s interest in public sector support for screen in Scotland. My letter to the committee in advance of this meeting was intended to provide useful updates and context. However, I want to restate the position on activity that is under way to deliver a new permanent studio facility for Scotland. Scotland needs—and the Scottish Government and our public sector partners want—a permanent studio facility, and I am committed to doing all that we can to deliver that studio. It is important to note that we are not procuring a studio; instead, as we have stated from the outset, we welcome proposals for private sector-owned and operated studios that meet the needs of the industries concerned and are financially viable to meet state aid rules. We want to make that happen, and the film studio delivery group is doing all that it can to find a way through what are sometimes complex challenges. We remain open to other bids from private sector investors. The European Union state aid rules mean that we must act commercially under the market economy operator principle and not use public funds either to distort or to create an advantage in the market. That means that, as a public sector investor, we need to secure commercially competitive returns to be state aid compliant. We are trying to achieve that by partnering with a private sector investor who is prepared to take an equal risk on a commercial venture. As Wardpark Studios Ltd will shortly be applying for an extension to its Cumbernauld facility, I can, with the agreement of the private developer, tell the committee now that Wardpark Studios is the developer that the film studio delivery group has been negotiating with. I am happy to elaborate on that work in this evidence session. The committee will also be aware that the private developer Pentland Studios Ltd has been looking to build on a site in Straiton, with a studio facility as part of the development. That planning application has been recalled, and it is currently with Scottish ministers for appeal. I will try to answer what questions I can, but while the independent reporter is undertaking the assessment and before the recommendation to ministers is made, we are limited in what we can actually say. In addition, Creative Scotland actively promotes currently available film locations in Scotland and continually brings to the market new options, including temporary studios. We are continuing to invest in Scotland’s screen sector in other ways. A record £24.1 million of public sector funding was awarded to support the industry in 2014-15. In order to build on that, we introduced in 2015 an additional £4.75 million of new funds to strengthen the sector. The £24.1 million figure for 2014-15 is a record spend for screen, even without the additional funding in 2015-16, and compares favourably with the £16 million for Scottish Screen back in 2009-10. I am aware that you are interested in the Scottish Government’s work on BBC charter renewal. It is important that we view both the studio work and our ambitions for Scotland as part of a wide-ranging vision for growing and developing Scotland’s screen sector. The studio is a key part of that vision, as is a stronger BBC Scotland. I hope that the information that I have provided in my letter and in these remarks will be helpful in today’s discussions.
In the same item of business
The Convener
Con
Agenda item 2 is continuation of our evidence taking on the economic impact of the creative industries. I welcome to the meeting Fiona Hyslop, the Cabinet Se...
The Cabinet Secretary for Culture, Europe and External Affairs (Fiona Hyslop)
SNP
Thank you, convener. If this is indeed the committee’s last meeting, I should thank the committee for its on-going interest in the creative industries and ac...
The Convener
Con
Members are interested in a number of different topics. We are keen to explore the film studio issue a bit more, given that it has been at the top of the age...
Fiona Hyslop
SNP
I have announced today that we will have additional studio space—subject, of course, to planning permission by North Lanarkshire Council—and the six-studio s...
The Convener
Con
The delivery of this new project is welcome news, and I am sure that other members will have questions about the detail. Do we have state aid clearance for S...
Fiona Hyslop
SNP
The point of frustration over the past year has been getting a combination of public and private money to ensure that it is state aid compliant. David Smith ...
David Smith (Scottish Enterprise)
We have considered the indicative package of support and the agreement in principle that we have with Wardpark Studios and we have taken advice, so we are co...
The Convener
Con
Thank you. What is the timescale for delivery?
Fiona Hyslop
SNP
That will depend on the private sector developer and the planning process, which will be starting in North Lanarkshire Council.
The Convener
Con
I understand the issues around state aid clearance but, for the record, is it your understanding that the Pentland Studios proposal was not reliant on any st...
Fiona Hyslop
SNP
Yes, that is my understanding. We welcome the opportunity for studio space in Scotland. However, as that particular proposal has been recalled by Scottish mi...
The Convener
Con
I understand that. Can Scotland support more than one film studio?
Fiona Hyslop
SNP
Yes—and I have said so on a number of occasions.
Richard Lyle (Central Scotland) (SNP)
SNP
I want to come in straight away because Cumbernauld is in my region. We gave Mr Smith a hard time the last time that he was at the committee, and we were ver...
The Convener
Con
I am not sure that that was a question, but you can respond if you wish, cabinet secretary.
Fiona Hyslop
SNP
As I say in my letter, there are other live interests and we are pursuing them as well. We are not resting with one proposal. I have charged the film studio ...
Richard Lyle
SNP
Can you tell me when the planning application will be submitted?
Fiona Hyslop
SNP
I stress that the application will not be made by ministers. The private developer must make that move, and he has indicated to us that the planning applicat...
Chic Brodie (South Scotland) (SNP)
SNP
Good morning. Today’s news is good news. I am sure that it is no coincidence that it has been announced today, in view of the committee’s meeting. I want to...
Fiona Hyslop
SNP
As you will be aware, the competition rules do not apply only to films and the film market in Scotland—they operate across the UK and the rest of Europe. Whe...
Chic Brodie
SNP
Forgive me, but is it not the case that, even if a public entity was to use public sector borrowing to build such a facility, as long as it produced a commer...
Fiona Hyslop
SNP
Today’s announcement is certainly state aid compliant. As regards what has been happening not just over a number of months but since the film studio delivery...
David Smith
When the recent legal case in which there was an EU judgment on the Ciudad de la Luz development in Valencia was concluded, information was given about the l...
Chic Brodie
SNP
Yes, but—
David Smith
If I could just finish—
Chic Brodie
SNP
I beg your pardon.
David Smith
On the basis of that judgment, we modelled extensively the case for a new build studio project that was directed, owned and developed solely by the public se...
Chic Brodie
SNP
Forgive me, Mr Smith, but the cabinet secretary has just announced that you are going to build a 30,000 square feet—
Fiona Hyslop
SNP
We are not building it. The private sector developer is building it, as was the case in Northern Ireland. You should remember that, in Wales, a Government-ow...
Chic Brodie
SNP
Can I suggest, cabinet secretary, somewhere that is close to your heart and mine? Someone might look at the former Digital Equipment plant, which has been ly...