TIGA, the trade association representing the UK games industry, today welcomed the Prime Minister’s commitment to rebalance the UK economy and to support knowledge based businesses, including the creative industries. TIGA made the comments in response to David Cameron’s first major speech as Prime Minister on Friday May 28th 2010, in which he said that the economy had become over reliant on a few industries and on the public sector.
The Prime Minister said in his speech that:
“Today our economy is heavily reliant on just a few industries and a few regions – particularly London and the South East…We are determined that should change. That doesn’t mean picking winners but it does mean supporting growing industries – aerospace, pharmaceuticals, high-value manufacturing, hi-tech engineering, low carbon technology. And all the knowledge-based businesses including the creative industries.””
Richard Wilson, CEO of TIGA, said:
“TIGA welcomes the Prime Minister’s commitment to rebalance the UK economy and to support knowledge based businesses, including the creative sectors. The UK video games industry is precisely one of the sectors which the Government should support as part of a strategy to rebalance the economy.
“The UK video games sector is a knowledge industry, with 60 per cent of a typical development studio’s workforce qualified to degree level and in many studios this figure rises to 80 per cent. Additionally, 40 per cent of development studios work with one or more universities, advising on course content and/or engaged in knowledge transfer.
“The games development sector is export oriented: on average 62 per cent of a UK developers’ turnover is generated through exports.
“The games industry is low carbon by nature. Most of the work in games development involves design on computers, the packaging in games is minimal and box products are relatively light to manufacture and to transport. In the future, video games will become even more low carbon in nature as the industry moves towards digital distribution.
“The sector also provides employment throughout the UK. 85 per cent of the video games development’s workforce is employed outside of London.
“If the Coalition Government introduces a Games Tax Relief in the Budget on June 22, then the UK video games industry will be able to compete on a more level playing field against our overseas rivals. Our sector will increase employment, expand investment and export more, generating further revenues for the Exchequer.””
Jason Kingsley, TIGA Chairman and CEO and Creative Director of Rebellion, said:
“TIGA welcomes the Government’s commitment to reduce the deficit, keep tax rates and the regulatory burden low, to abolish employers’ National Insurance Contributions on the first ten jobs created by new businesses for the next two years and its plans for super-fast broadband.
“However, the Prime Minister is right to say that economic growth does not merely depend on cutting the deficit and ensuring lower taxes and few regulations. It also involves a Government with a modern approach to supporting enterprise, giving business the support they need in order to grow. The UK video games industry is at a critical point. If the Coalition Government introduces a Games Tax Relief it will not only stimulate growth in a knowledge based, low carbon and export oriented industry, it will also play an important part in rebalancing the UK economy away from financial services and the public sector and towards an entrepreneurial, high technological future. Conversely, if a Games Tax Relief is not introduced, the industry will decline and the opportunity to be a world leader in games development will be lost. We hope that the Government will seize the opportunity in the June Budget to introduce Games Tax Relief.””