Insights UK Screen Alliance and Animation UK publish recommendations for new government

The UK Screen Alliance, the trade association representing visual effects (VFX), TV & Film studios, post production and animation in the UK, has published its election manifesto for the next UK government. It is complemented by a separate manifesto from Animation UK.

First on the agenda for the UK Screen Alliance is screen sector tax relief. It argues that the next government should continue to support such relief and that it should enact the proposals of the 2024 Spring Budget for increased tax relief for Visual Effects (commented upon here). However, it recommends that the next government goes further and increases the rate of relief from 29.25% net for VFX spend to a rate of 32%, stating that this would be “more optimally comparable with international competitor territories and stimulate further growth in the UK”. Furthermore, it argues for the implementation date for the VFX uplift to be brought forward from April 2025, as currently proposed, to 1 January 2025.

The manifesto also asks that the next government abandons plans to provide for an exclusion for the cost of Generative AI from the VFX relief, as currently proposed. In its view, such a proposal would “reduce competitiveness, undoing many of the advantages of the new VFX uplift, as the UK would be the only country in the world to exclude Generative AI from its tax credit. It would drive work abroad and cost British jobs rather than creating them”. Equally, it argues that the next government should “introduce an exclusion for VFX costs from the 80% cap in the new Independent Film Tax Credit, allowing limited budget films to keep their VFX in the UK rather than seeking tax credits in overseas territories”.

Turning to education and skills, the UK Screen Alliance calls for a commitment to continue to fund the AIM Extended Diploma in Games, Animation and Visual Effects Skills, and for the apprenticeship levy to be reformed to allow “for more flexible use of employer contributions” and for companies to “cover internal admin and support costs from the levy and allow a proportion of the levy to be used for accredited short course training”. It also argues that the creative industries remain a priority sector for so-called ‘bootcamp funding’ and that the next government should continue to fund and expand the Creative Careers Programme. In addition, the manifesto argues that steps are taken to ensure that the UK does not lose out on access to international talent by, for example, abolishing the Immigration Skills Charge for priority sectors, retaining the Graduate Visa, ruling out a cap on the number of visas issued, and ensuring that VFX and post production continues to be able to access the Creative Visa Route.

Finally, the manifesto argues for the next government to commission a review of the contractual terms offered to post production and VFX suppliers by independent producers who have been commissioned by the regulated broadcasters, “with a view to establishing a code of practice to foster a more stable investment environment for supply chain employers with fairer commercial practices”.

Separately, Animation UK, itself a member of the UK Screen Alliance, has issued a manifesto with recommendations that, it argues, aim to “not only safeguard the future of the UK animation sector, but also, to position it as a global leader in innovation and creativity”.

The manifesto contains five proposals:

  1. Uplift tax incentives. It argues for an increase in the rate of the AVEC incentive for animation content to 37%.
  2. Reimagine Children’s Public Service Media for a Digital Generation. The manifesto calls for a reversal in the decline in Public Service spending by both reintroducing a “revitalised £100m Children’s Content Fund for Public Service and Education content” and reviewing the Public Service media to “focus on access to high quality content, shown where the audience are watching”.
  3. Unlock Private Investment. It recommends that the EIS, SEIS, patent box eligibility and private sector incentives should be reviewed and updated “to work for the animation sector and generate valuable IP”.
  4. Boost International Trade and Co-productions. The next government is urged to “significantly increase the UK Global Screen Fund as well as explore re-affiliation/associate membership with Creative Europe/Media to regain access to vital co-production funding and market access”.
  5. Supercharge Creative Education and Skill. Finally, there is a call for a refocusing on “arts based and creative education and [to] support the skills needed to place the UK as a world leader in digital production”.

Commenting on the manifesto, Kate O’Connor, Executive Chair of Animation UK, writes, “we have developed a strategic roadmap to leverage our creative strengths, ensuring local and UK-wide growth. Our recommendations align with the sector’s growth and job creation potential, setting the stage for the UK to lead globally in animation. We are not asking for handouts, but adoption of these targeted policies will support our vibrant, competitive, and innovative UK animation industry that could double in size, job growth and output, significantly elevating the wider sector’s value to £2.6bn.”

To read the UK Screen Alliance manifesto in full, click here.

To read the UK Animation manifesto, click here.