Who decid­ed inde­pen­dent cin­e­mas are worth 2.8%?

After more than a year of social iso­la­tion, there is no joy quite like sit­ting in a dark room, sur­round­ed by strangers, ready to stuff your face with pop­corn and watch a movie.

At the Prince Charles Cin­e­ma in London’s Leices­ter Square, a pre-reel announce­ment informs cus­tomers that the air is refreshed eight times an hour by hos­pi­tal grade air fil­tra­tion sys­tems; that all staff are mak­ing every effort to main­tain social dis­tanc­ing and covid restric­tions; and that your seat is cleaned before and after you use it.

Inde­pen­dent cin­e­mas are mak­ing a Her­culean effort to entice audi­ences back and keep them safe. Since our last report, sta­tis­tics from the BFI have been updat­ed, and as of June 2021, 209 inde­pen­dent cin­e­mas in Eng­land have been award­ed fund­ing from the Cul­ture Recov­ery Fund (CRF). They were all oblig­ed, and indeed eager, to invest in mea­sures that make going to the cin­e­ma safe dur­ing the pandemic.

At the start of the pan­dem­ic, Oxford Eco­nom­ics released a report pre­dict­ing a ​“cul­tur­al cat­a­stro­phe” in the UK, with a £74 bil­lion expect­ed drop in rev­enue and 400,000 jobs threat­ened in the entire sec­tor, while ​“the film, TV, radio and pho­tog­ra­phy sec­tors face a loss of £36 bil­lion in rev­enue (57 per cent), with 102,000 jobs at risk (42 per cent).”

There are 808 cin­e­mas in the UK, but the CRF was only avail­able, through the BFI, to inde­pen­dent cin­e­mas locat­ed in Eng­land. There are 315 inde­pen­dent cin­e­mas in the UK. Accord­ing to a spokesper­son for the BFI, ​“78 per cent of eli­gi­ble cin­e­mas received grants” and ​“83 per cent of these were out­side of Lon­don”. Out of the promised £44 mil­lion made avail­able for inde­pen­dent cin­e­mas, “£27.6 mil­lion across these 206 cin­e­mas” has been award­ed so far.

Sarah Healey, the per­ma­nent sec­re­tary for the Depart­ment for Cul­ture, Media and Sport, recent­ly admit­ted dur­ing an enquiry into the dis­tri­b­u­tion of the CRF that the gov­ern­ment was well aware from ​“the begin­ning of the first lock­down” that the pan­dem­ic would have ​“a par­tic­u­lar­ly severe impact on the cul­ture sec­tor com­pared to the rest of the economy”.

Despite this, at the time of writ­ing only half of the £1.6 bil­lion CRF has been allo­cat­ed. In the sec­ond round of fund­ing, known as ​‘CRF2’, only 85 per cent of allo­cat­ed fund­ing has been dis­trib­uted, despite the asser­tion the mon­ey was pro­vid­ed to cov­er expens­es ​“between April and June”.

This is par­tic­u­lar­ly galling when sup­port for free­lancers in the indus­try has been so sparse. At least one mil­lion peo­ple in the indus­try may have fall­en through the cracks and missed out on gov­ern­ment fund­ing, accord­ing to the BBC. Oth­er reports claim that only one in five TV free­lancers are eli­gi­ble for sup­port, with many indeed turn­ing to food banks as pre­vi­ous­ly predicted.

Dur­ing the enquiry into the dis­tri­b­u­tion of the CRF, Healy said that ​“100,000 free­lancers have been sup­port­ed and kept in income as a result of the CRF’s fund­ing”. Addi­tion­al­ly, Dar­ren Hen­ley claimed that ACE over the last year ​“has invest­ed a total of £51.7 mil­lion in 13,464 indi­vid­u­als and free­lancers”. He also said that by ​“invest­ing in the infra­struc­ture” it allowed free­lancers to ​“be employed in the future”.

The BFI has also been involved in pro­vid­ing fund­ing for the Covid-19 Emer­gency Fund for Film & TV with Film & TV Char­i­ty that, accord­ing to their spokesper­son, has pro­vid­ed ​“sub­stan­tial sup­port from indus­try to sup­port freelancers”.

Even as fund­ing is slow­ly made avail­able, cin­e­mas still rely on bums in seats to sur­vive – espe­cial­ly when promised gov­ern­ment fund­ing has been so sparse. While the BFI has done a ​“bril­liant job” with the lim­it­ed fund­ing it has been award­ed – just 2.8 per cent of the total CRF as we pre­vi­ous­ly report­ed – the ques­tion of who is ulti­mate­ly respon­si­ble for the fate of inde­pen­dent cin­e­ma remains. Who decid­ed that inde­pen­dent cin­e­mas were worth such a small pro­por­tion of the CRF? The answer may lie in the Cul­ture Recov­ery Fund Board.

The Board com­pris­es 13 indi­vid­u­als, some of which are detailed in the info­graph­ic below. Many of them have his­to­ries in con­sult­ing and the finan­cial indus­tries, and mon­e­tary links to arts, such as sit­ting on the boards of the­atres or invest­ing in film. These appoint­ments include one rep­re­sen­ta­tive from each arm’s length body that dis­trib­uted funds – Jay Hunt from the BFI, Nicholas Sero­ta from Arts Coun­cil Eng­land and so on.

There is a strik­ing lack of input from local coun­cils or com­mu­ni­ties, or any indi­vid­ual with a pure­ly artis­tic or cre­ative lens. It appears that the board not only miss­es a beat in cov­er­ing the arts with actu­al mak­ers of art, but it also under­val­ues the eco­nom­i­cal con­tri­bu­tion of the sector.

Arguably, many of those list­ed were cho­sen to over­see the dis­tri­b­u­tion of fund­ing due to their finan­cial expe­ri­ence in the indus­try. But some appoint­ments may sup­port the accu­sa­tion of a ​“cul­tur­al cleans­ing” cam­paign from Down­ing Street that the Finan­cial Times recent­ly report­ed.

The FT alleges that the gov­ern­ment is mak­ing a con­cert­ed effort to ​“reset the bal­ance of opin­ion at the top of Britain’s cul­tur­al and media insti­tu­tions” through board appoint­ments. This includes veto­ing a sec­ond term for two female direc­tors of Chan­nel 4, oppos­ing Mary Beard’s nom­i­na­tion as a trustee for the British Muse­um, plac­ing Con­ser­v­a­tive MP Jacob Rees-Mogg to the board of the Nation­al Por­trait Gallery and nom­i­nat­ing Rob­bie Gibb, for­mer Down­ing Street direc­tor of com­mu­ni­ca­tions, to the BBC board.

It is increas­ing­ly clear that the future of inde­pen­dent cin­e­ma, and indeed the entire cul­ture sec­tor, is being decid­ed through the nar­row lens of prof­itabil­i­ty. Pre­vi­ous­ly we uncov­ered a gov­ern­ment-built algo­rithm that is at the heart of Covid grant dis­tri­b­u­tion, leav­ing the ques­tion of cul­tur­al impor­tance to be decid­ed by a piece of soft­ware. A spokesper­son for DCMS has sub­se­quent­ly told us that ​“it was used by the CRF deliv­ery bod­ies as part of their assur­ance process” but ​“it was not used to make deci­sions itself as to who did and did not receive fund­ing. Its analy­sis sup­port­ed fund­ing deci­sions which were made sole­ly by the deliv­ery bod­ies or the CRF Board”.

This does noth­ing to assuage sus­pi­cions that CRF grant mon­ey was dis­trib­uted based on the finan­cial impli­ca­tions of fund­ing insti­tu­tions over their cul­tur­al impact or need. Com­put­ers are not yet able to judge cul­tur­al merit.

While the Spot­light algo­rithm ini­tial­ly fil­ters appli­cants, fund­ing is then decid­ed and man­aged by mem­bers of the Cul­ture Recov­ery Fund Board. These deci­sions are being made in meet­ings with DCMS and pri­vate con­sul­tan­cy firms Ernst & Young, Price­wa­ter­house­C­oop­ers and Smith and Williamson.

Through Free­dom of Infor­ma­tion requests we found that every meet­ing held in rela­tion to the dis­tri­b­u­tion of the CRF was attend­ed by Ernst & Young. In fact, there has been over £1.7 mil­lion spent by the gov­ern­ment on advice and con­sul­tan­cy in rela­tion to the CRF, despite there being an unpaid board man­ag­ing the deliv­ery of the fund.

This inves­ti­ga­tion has found one such con­tract for £623,175 to ​“sup­port DCMS in the deliv­ery of the Cul­tur­al Recov­ery Fund pro­gramme” was award­ed to Ernst & Young. Although DCMS declined to pro­vide more infor­ma­tion on the con­tract, a spokesper­son told us that ​“Ernst & Young pro­vid­ed expert sup­port to DCMS and the deliv­ery bod­ies dur­ing the deliv­ery of the Cul­ture Recov­ery Fund, par­tic­u­lar­ly in pro­vid­ing finan­cial exper­tise in order to ensure best val­ue for the tax­pay­ers’ money.”

Con­fus­ing­ly, how­ev­er, they also claimed that ​“Ernst & Young did not feed into the deci­sions made by the Cul­ture Recov­ery Board”. Why a con­sul­tan­cy firm was paid over half a mil­lion pounds seem­ing­ly not to have any effect on the deci­sion mak­ing process is unclear.

Anoth­er gov­ern­ment con­tract worth £556,275 was award­ed to Eco­rys Ltd for the ​“eval­u­a­tion of the Cul­ture Recov­ery Fund”. The process was so stress­ful, it appears, that Strate­gic Health Lim­it­ed were also award­ed a £16,000 con­tract to ​“sup­port the health and well­be­ing” of the staff at Arts Coun­cil Eng­land dur­ing this time.

Chair­ing the Cul­ture Recov­ery Fund Board is Sir Damon Buffi­ni, who since 2015 has also been the Chair of the Board at the Nation­al The­atre, which laid off almost 400 staff mem­bers in July 2020. He has pub­licly stat­ed that due to the ​“con­flict of inter­est” he ​“will remove” him­self from any meet­ings in rela­tion to the NT’s appli­ca­tion for funding.

Accord­ing to FOIs we sub­mit­ted there were sev­en meet­ings held by the CRF Board up to and includ­ing Decem­ber 2020; two were ​“grant dis­cus­sions” and four were to dis­cuss loans. Buffi­ni is list­ed as hav­ing chaired every meet­ing. That month the gov­ern­ment announced the Nation­al The­atre had been grant­ed a £19.7 mil­lion repayable finance loan. Sir Buffi­ni did not respond to a request for com­ment, but a spokesper­son for DCMS told us that ​“at no point did Damon influ­ence deci­sion mak­ing over the loan for the Nation­al The­atre” and that when it was dis­cussed, he ​“recused him­self from the meet­ing and Car­ol Lake assumed Chair”.

Buffi­ni is also a direc­tor of three ​“invest­ment schemes” owned by Inge­nious Media. The com­pa­ny came under scruti­ny in 2014 after it was accused of being a tax-avoid­ance scheme where ​“many investors put mon­ey into schemes that backed the British film indus­try”. As direc­tors of these part­ner­ships, ​“they were then able to write off loss­es against oth­er income”. It has since been ruled that ​“the schemes did not give rise to the intend­ed tax relief for the investors” and sub­se­quent­ly, ​“over 500 investors have issued claims”. Buffi­ni was con­tact­ed mul­ti­ple times with a request for com­ment, but gave none.

Then there is Dr Samir Shah CBE, who is list­ed as an Inde­pen­dent Board Mem­ber for the CRF. He is a com­mis­sion­er for the Com­mis­sion on Race and Eth­nic Dis­par­i­ties. He is also co-author of the con­tro­ver­sial Race Report that the UN has called ​“an attempt to nor­malise white suprema­cy” that it ​“cat­e­gor­i­cal­ly rejects and con­demns the analy­sis and find­ings” of. Shah defend­ed the report in The Spec­ta­tor by pos­ing the ques­tion: ​“If insti­tu­tion­al racism is imma­nent in our cul­ture and our insti­tu­tions, how can peo­ple of the same race have such dif­fer­ent fortunes?”

It’s not an over­state­ment to say that the future of inde­pen­dent cin­e­ma in the UK is in the hands of these peo­ple. And the month delay to the fourth stage of lock­down restric­tions eas­ing meant that the­atres, arts and per­for­mance spaces were once again left hold­ing the short straw. While restau­rants, pubs, bars and gyms are oper­at­ing almost at full capac­i­ty, the­atres still sit emp­ty. Cin­e­mas, even with hos­pi­tal-grade air fil­tra­tion sys­tems, are scram­bling to draw audi­ences while film dis­trib­u­tors ner­vous­ly hold back releases.

If the future of inde­pen­dent cin­e­ma, and indeed the entire arts and cul­ture sec­tor, is decid­ed sole­ly on its prof­it-mak­ing via­bil­i­ty, it will be in seri­ous trou­ble. While the dis­tri­b­u­tion of vital funds should indeed have input from finan­cial experts, the selec­tion of the CRF Board indi­cates that those most respon­si­ble for the industry’s recov­ery have alto­geth­er dif­fer­ent pri­or­i­ties than those mak­ing the art that we love.

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