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Spending Cuts In The Animation Industry (As published in Imagine: the magazine for professionals in the animation industry)

With the release of the Comprehensive Spending Review on the 20th October and the budget on the 3th November professionals have been concerned over how these cut-backs will affect them and their businesses.

The animation industry is so varied that it has been hard to tell how the cuts will affect the industry as a whole. Will the cuts made by the Culture, Media and Sport’s Ministry have an impact on our animation film industry? Do the Business, Innovation and Skills Ministry believe that our high-tech animators, especially in the video games industry, will see any of their £200m planned investment in high-tech industries? Here at Imagine, we asked professionals in the industry how they felt the cuts would affect them.

With cuts set at 25 per cent across the board, the animation industry will be hit hard in more than a few places it seems. Richard Wilson, CEO of TIGA, the trade association representing the UK’s video gaming industry, has been campaigning for two years to try and get games tax relief from the government.

In an exclusive statement to Imagine, Wilson told us that: “We believe that the loss of games tax relief will lead to a decline in the UK development workforce.”

Having worked so hard to get he previous government to add this proposal to the budget talks, Wilson was shocked that the coalition dropped it from their talks this June.

Over the last two years the number of employees in the computer games industry has dropped by nine per cent. Wilson is determined to keep campaigning and arguing with the government to get tax relief for the gaming industry, which he claims could generate up to £415m in tax receipts to the Treasury.

The video games industry is not the only concerned party. In June this year, production companies including Blue Zoo and Aardman Animations, the creators of Wallace and Gromit, banded together as Animation UK called on the government to award them similar tax benefits as those awarded to the film industry.

Their campaign, Save UK Animation, was launched before the coalition announced their emergency budget. Both parties in the coalition proposed supporting the creative industries whilst in opposition, but now the cuts have come and the creative industries are being hit hard.

The global animation industry is estimated to be worth £200bn, but the industry in the UK is worth just £120m. Many professionals in the industry are worried that the cuts will result in the UK’s animation industry losing home-grown talent.

Miles Bullough, speaking on behalf of Aardman Animations, commented that: “If every country took away their financial support then the UK’s position in the international market would strengthen immeasurably because we are so good at it … as long as so many countries provide financial support to their production sectors we are at a disadvantage and we are losing to our overseas competitors.”

Wilson echoes these sentiments. When we asked him if he thought that the rise in university tuition fees to £9,000 a year would put students off studying animation he said he “hoped they wouldn’t” and said that universities in this country that provide courses in animation must be supported by the government in the same way as our competitors in Canada and Korea are.

The light on the horizon seems to be Business Secretary Vince Cable’s announcement on the 25th October that there will be a £200m investment in the high-tech industries. This could allow animators in both the film and games industry being able to claim a bit of government funding, but as Wilson points out, “It won’t simply be the development sector, or the animation sector that benefits from such a fund.”