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Pinewood...more Govt Propaganda


Albert Tatlock

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Treasury Minister Eddie Teare said it could have an effect on the island’s reputation in the international community as a reputable and reliable business partner. ‘This is not just about investment and returns - it’s about the way the Isle of Man does business,’ he said.

 

 

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According to IOMToday the Pinewood debate ended in a farce. I can’t say that I agree with that. I am old enough to remember Brian Rix’s ‘low comedies’ at the Whitehall and Adwych Theatres. I wasn’t laughing, nor do I think are the majority of the taxpayers on the Isle of Man either.

 

One definition of ‘farce ’in dramatic theatre, is a comedy that aims at entertaining the audience through situations that are highly exaggerated, extravagant, and thus improbable. So in that definition we do have the three aspects covered. But in the final analysis I don’t think it is a farce, because the history of the Media Development Fund and the events that have come out of it are not giving much cause for laughter from the people who are being forced to pay for them.

 

I was asking myself this question. When Eddie Teare worked in a Bank did he approve every loan application that came across his desk because he was legally obliged to, that he had no choice but to say yes? Or did he hold fast to the fact that the Bank always had the final say to lend or refuse on any or all loan applications and had kept that legal right?

 

I think it would be a very popular bank that was under a legal obligation to approve any loan application to anyone for any amount no matter if the applicant was able or incapable of repayment? That situation would be improbable to imagine, and any bank that was idiotic enough to allow that to take place would be a bank likely to have no money in it at all in a very short period of time.

 

However, according to Messrs Teare, Coleman, Singer, Skelly, and Acting Attorney General Quine that ‘could’ be the situation with Pinewood and the contract the Treasury has made.

 

We could be sued if we don’t spend the cash on films with Pinewood they wail. Won’t someone please think about our reputation they howl

 

Leaving aside for the moment the supposed incidental ‘benefits’ being claimed by the Treasury and the Dept of Economic Development said by them to run into the hundreds of millions of pounds, but just concentrating at the legal point of ‘compulsion to specific performance’ being said ‘could’ be used by Pinewood to compel Treasury to spend all of the Media Development Fund with them.

 

I have listed below comments I have found in the Hansard on this point. You can read for yourself, the Treasury always retains the right to say no to any proposal being brought to it from Pinewood. That right of refusal has been confirmed on a number of times in the Parliament. Even Mr Singer MHK insisted that the Treasury had the final say. “The final gatekeeper here is with the Treasury, who would opine and give a decision on the individual investment in an individual film. That is the final decision and that is the way that we can actually control it”.

 

So how could Pinewood challenge the decision not to spend MDF money on any film project being brought to it? Well frankly speaking it couldn’t, it would just have to accept the decision from the Treasury and go away.

 

Could is a powerful word. You ‘could’ be sued is a very powerful statement, until you actually factor in the reasons why you ‘couldn’t’. Then if the reasons why you couldn’t are so irresistible, so manifestly obvious, that to suggest you ‘could’ be sued regardless of the facts, in those circumstances that would just be farcical wouldn’t it?

 

What I do think is farcical is that Minister Teare and Allan Bell are proving that they will do anything, say anything to justify the unjustifiable, and we have seen that kind of farce played out before on the Isle of Man and we know how much those productions cost us too.

 

Is it possible that we saw an Acting Attorney General playing more the part of a politician than a lawyer in the debate? Is it possible that we witnessed an ‘ambush’ of a MHK to crush any possibility of straight answers being given to straight questions?

 

Kate Beecroft said she accepted that the Treasury was obliged to pay contracted fees to Pinewood. However, she said that the Treasury was not obliged to spend MDF money on demand from Pinewood. According to Treasury Minister Teare’s own words spoken in the Parliament she was absolutely correct.

 

So who are standing with their pants around their ankles now?

 

 

http://www.iomtoday.co.im/news/isle-of-man-news/pinewood-debate-ends-in-farce-1-7122948

http://www.iomtoday.co.im/news/isle-of-man-news/22-000-payout-for-dismissal-1-4802376

“The tribunal, chaired by Douglas Stewart, agreed with Mr Harding the selection process for the new post had been ‘a sham’ and found in favour of the claimant after concluding key witnesses called by Sefton Group company secretary John Quinn were ‘unreliable’.”

http://www.gov.im/lib/docs/registries/tribunal/et1197.pdf

 

Tynwald Court; 10th July

2012<http://www.tynwald.org.im/business/hansard/20002020/t120710.pdf>; Q14

(line 1487) The Minister: If I could refresh the Hon. Member's memory, no investment in any particular film will be made until Treasury has given its approval. In effect, the final decision rests with Treasury. I could also refer her to the Report, which was issued to Hon. Members prior to last month's sitting, the Strategy for the Future of the Isle of Man Film Industry, at section 5.1 on page 13, we do set out what we expect from this investment.

 

House of Keys; 23rd October

2012<http://www.tynwald.org.im/business/hansard/20002020/k121023.pdf>; Q4

(line 141) And finally, moving on to address the fourth of the Questions, the most important safeguard in this process will be this ultimate discretion of the Treasury to commit investment into any project presented by our fund managers, Pinewood Film Advisors Limited, a wholly owned subsidiary of Pinewood Shepperton PLC. Each project investment will be determined on a case-by-case basis with the investment report setting out all the key information, upon which Treasury will base its decision. Thank you, Mr Deputy Speaker.

 

House of Keys; 4th December

2012<http://www.tynwald.org.im/business/hansard/20002020/k121204.pdf>; Q2

(line 148) The Minister: With respect to the Hon. Member, I think she is confusing two separate issues. (Mrs Beecroft: No.) The final gatekeeper here is with the Treasury, who would opine and give a decision on the individual investment in an individual film. That is the final decision and that is the way that we can actually control it.

 

 

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The Isle of Man is promoted as a magical place, its Government has tried over the years to describe how special a place they claim it to be. It’s worth restating in full the promise the Government has made to the world at large; ‘Freedom to Flourish. Our Promise, The Isle of Man is a land of possibility where people and business will find the right environment in which to reach their full potential, whatever they feel that might be.’ https://www.gov.im/about-the-government/offices/cabinet-office/freedom-to-flourish/

 

Now the Isle of Man is being promoted as the place ‘Where you can’, there is a website where examples of that can be viewed. http://www.whereyoucan.com/Info-Centre/Case-Studies.aspx

 

The section that describes the Islands key sectors is notable for what is left out. http://www.whereyoucan.com/sectors

 

Eleven ‘key’ sectors are listed on the web page, Aerospace, Aviation, Clean Tech, e-Business, (Digital Currency), e-Gaming, Financial Services, Manufacturing, Maritime, Retail, Space, and Tourism, but no Film Industry.

 

Of the Film Industry there is not a mention which is curious given the extravagant, boastful, insistent claims Minister’s and certain MHK’s have made in the Tynwald to say that that particular industry has made hundreds of millions of pounds for the Treasury and the same again for the Treasury in the United Kingdom too

.

It’s worth taking a closer look at the claims and the promise too, if only to see if the claims and the promise are as substantial as the mists that cover the magical isle of Manannan.

 

Starting at a statement made before the Public Accounts Committee under the heading ‘Key Issues of Concern (2) Return on Investment, Local Spend 5.1 and on.

http://www.tynwald.org.im/business/pp/Reports/2010-PP-0105.pdf

 

“5.1 For example, in his budget speech in March 2002 the Treasury Minister reported to Tynwald that 37 films had been shot on the Island generating some 100,000 bed-nights for local hoteliers as part of an estimated local spend of £23 million. Based on the information above, the amount of the Government's investment by this time was £2 million in 1995 to 1997, plus £19.5 million from 1997 to 2002, making a total of £21.5 million.”

 

“5.3 Internal Audit noted in their report that the on-going funding of the Media Development Fund was not dependent on the return to Government from local spend. This was because, as set out above, under the Isle of Man Film Limited mechanism as it operated up to March 2007, the Media Development Fund itself benefited both from direct returns from film distribution and from indirect receipts to the exchequer

.

Nevertheless, local spend continued to be calculated and in the presentation to Members in October 2007 a figure of £67 million local spend for the first 86 films was quoted.”

 

And, “5.5 How is the Treasury to satisfy itself that the 20 per cent has been adhered to? In 2003/04 Internal Audit were concerned that, as the production companies' statements of local spend had been independently audited, they had not been reviewed by Film Commission staff for reasonableness but had been accepted at face value. Internal Audit made a detailed study of the audited local spend figure in respect of three productions. They found that the local spend figures included a number of items which should not have been considered local spend under the terms and conditions. On the basis of this sample they calculated that the figure taken as likely to accrue to Government general revenue as a result of local spend had been overstated by almost 60 per cent.”

 

Getting the figure wrong by “almost 60 per cent” would be a serious mistake by anybody’s calculation, and as these figures have been and are so crucial to understanding the accuracy of the value of this industry one would easily think that the Treasury would be at pains to correct the data?

 

The PAC thought so too, it recommended;

 

RECOMMENDATION 2

 

That the Treasury review the methodology for defining "local spend".

 

RECOMMENDATION 3

 

That the Treasury take steps to foster the development of a film audit specialism within the Island's financial sector, with the aim of improving the confidence Tynwald can place in statements of local spend.

 

The Treasury’s response was; "I can advise that Internal Audit Division has not undertaken any formal follow up work since the original review was undertaken. As I understand it the primary reason for this was that following the original review many changes were made, such as the creation of "Isle of Man Film". These would have had a significant impact on the administration associated with the investment of Government finds in film projects and as such any planned formal follow up work was suspended.

 

"The Film Fund Administration was identified during our 2008 audit identification process, the business element now sitting with CinernaNX Limited. However given its risk profile compared to other areas across government, it is not planned to be subject to a systematic review in our three year planning horizon."

 

The PAC were not amused and said as much; “We recognise that Internal Audit has to balance a range of priorities across Government but we do not accept that the working through of the change to Isle of Man Film Limited rendered the whole 2003/04 audit findings obsolete. The issue of local spend in particular we regard as unfinished business and we would encourage the Internal Audit Division to see if it can be resolved.

 

That’s where it stood until Oxford Economics was paid by the IOM Government to produce a justification for what it was about to do with Pinewood Shepperton Plc. In that report http://www.tynwald.org.im/business/opqp/sittings/20112014/2012-NN-0100.pdf with more of the same claims for job creation, millions of pounds in local spend topped off with bountiful expectations of large numbers of tourists looking to visit thanks to the exposure from films.

 

However, in a submission to the House of Lords, The British Film and Television Industries - Communications Committee, the Isle of Man Government provided a Memorandum.

 

http://www.publications.parliament.uk/pa/ld200910/ldselect/ldcomuni/37/37we16.htm

 

The Questions were asked;

 

2. How many people are employed in the Isle of Man film industry? What is the direct contribution of the film industry to the Isle of Man's GDP?

Answer: ‘The number of local people involved in the industry depends on the number of productions taking place and so varies greatly from year to year. Please refer to the crew and facilities section of our website—www.isleofmanfilm.com for further details of services and facilities that can be sourced locally.

 

The majority of all senior crew and technical crew are usually British.

 

The direct contribution of the film industry to the Isle of Man's GDP is not measured. This would involve a detailed study of all the companies which could be considered to be part of the industry, fully or partially. For example a joiner working on a film set would be classed under construction for GDP purposes. The importance of the industry to the Island's economy is by virtue of its purchasing power of local goods and services during the making of films.

 

In the reply was the statement, “The direct contribution of the film industry to the Isle of Man's GDP is not measured” and “The importance of the industry to the Island's economy is by virtue of its purchasing power of local goods and services during the making of films”.

 

As it has been proven by the Public Accounts Committee that the local spend calculations are guessed and not reliable, and the direct contribution to the IOM’s GDP is not measured the ‘importance’ to the Island’s local economy would reasonably be thought to be small. If it was important wouldn’t you expect those figures to be important enough if not crucial to being able to describe accurately the value of the film industry to the GDP of the Isle of Man?

 

Finally, what about the jobs said to have been created and a direct by product of the film industry on the Island?

 

http://www.whereyoucan.com/ibweb/res/pdf/pdf/Creative_Industries careers_leaflet.pdf

 

At page 9. Chapter; Film, TV, Radio & Photography.

 

“The majority of people working in film, TV and radio do so on a freelance basis”.

 

That being the case, it is therefore worthwhile to see if it is possible to identify and describe exactly how many people on the Isle of Man have worked on the films that have been financed by the Media Development Fund, and that information will be on a separate posting.

 

 

 

 

 

 

 

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IMO I have seen a number of production crews on the island over the past few years and can see that there would be some spend associated with the production, notable beneficiaries would be the Steam Packet and maybe some local hospitality providers. However in my wildest dreams I cannot foresee the scenario where the island benefits to the tune of many millions of pounds from these short visits , unless much is hidden from public view, to suggest that the logistics we provide for the visiting crews gets to these ridiculous sums is sheer fantasy ! and it does not surprise me that it is not audited !

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IMO I have seen a number of production crews on the island over the past few years and can see that there would be some spend associated with the production, notable beneficiaries would be the Steam Packet and maybe some local hospitality providers. However in my wildest dreams I cannot foresee the scenario where the island benefits to the tune of many millions of pounds from these short visits , unless much is hidden from public view, to suggest that the logistics we provide for the visiting crews gets to these ridiculous sums is sheer fantasy ! and it does not surprise me that it is not audited !

A few have been spotted in the Tanrogan. Presumably they'll be going to Samphire in the future.

But as you say it's hardly a multi-million pound business on the island these days.

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There are times when I ask myself does Eddie Teare, Allan Bell, Leonard Singer et al think that the films financed by the Media Development Fund have the cast and crew list deleted so nobody on the Isle of Man can see how many people were involved?

 

Also I wonder do they think that the United Kingdom companies accounts that are used in the financing of those films are electronically blocked to anyone from the Isle of Man accessing them from Companies House website?

 

We know how many films have been financed, we know the names of them, we know the companies that have been used, we can calculate and cross reference, and underpinning it all we can read for ourselves what has been said by COMIN on the floor of the Tynwald thanks to the Hansard Report. We can read for ourselves what the Public Accounts Committee has reported. We are able to sift fact from spin and we are entitled to know what our own Government is doing with our money.

 

They can say what they like in the Parliament and outside of it, but someone is always going to fact check it.

 

Mr Bell became quite cross with Paul Moulton in a recent interview when he was asked "is it about washing dirty linen in public?" Mr Bell sharp reply was "There is no dirty linen". I beg to differ and I think the Public Accounts Committee has done too. However unlike him, I think we are entitled to decide that for ourselves after we have considered the established facts.

 

 

 

 

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