Director’s cut | 11 October 2018

‘The role of government is not to pick favourites and subsidise them or protect them.’ So says the government’s industrial strategy, published last year — a document which was supposed to distinguish between a free-market approach and the interventionism favoured by Jeremy Corbyn. Yet in one industry, at least, the government is doing exactly what it says it should not: it is showering firms with subsidies in the hope of generating growth.

This week the British Film Institute (BFI) published a report making grand claims for the government’s ‘tax reliefs’ for the film industry. Under this scheme — which is misnamed because it involves subsidies paid out whether or not a company has a tax liability — taxpayers stump up 25 per cent of the cost of making a film so long as 80 per cent of the budget is spent in Britain. This scheme, claims the BFI, cost taxpayers £632 million in 2016 but ‘helped’ the film industry generate £2 billion in tax revenues.