Attendees and apologies
Mr Hepburn - Minister for Business, fair Work and Skills
- Bob Last, film producer and co-chair
- Carol Sinclair, Carol Sinclair Ceramics
- Rachel Brown, Creative Entrepreneurs’ Club
- Sarah Cameron, SENSCOT
- Jacqueline Donachie, artist, Glasgow Sculpture Studios
- Brian Coane, The Leith Agency / Institute of Advertising Practitioners Scotland
- Dougal Perman, Scottish Music Industry Association
- Simon Cotton, Johnstons of Elgin
- Janice Kirkpatrick, Graven
- Chris Hunt, freelance creative
- Jenny Todd, publishing consultant
- Jane Muirhead, Raise the Roof Productions
- Colin Anderson, Denki
- Iain Hamilton, Highlands and Islands Enterprise
- Andre Reibig, Scottish Funding Council
- David Martin, Skills Development Scotland
- Susan McColl, Scottish Enterprise
- Kevin Sievewright, Scottish Enterprise
- Clive Gillman, Creative Scotland
- Steve Little, Screen Scotland
- Simon Cuthbert-Kerr, Scottish Government
- Elinor Owe, Scottish Government
- Heather Holmes, Scottish Government
- Ms Hyslop, Cabinet Secretary for the Economy, Fair Work and Culture
- Philip Hannay, Cloch Solicitors
- Pamela Tulloch, Scottish Library and Information Council
- David Eustace, Photographer and Chancellor of Napier University
- Cameron Fraser, Ko Lik Animated Films
- Lorna Macaulay, The Harris Tweed Authority
- Lucy Mason, Freelance Arts Producer and Consultant
- Alex Smith, XpoNorth
- Richard Scott, Axis Animation
Items and actions
Welcome and introductions
Mr Hepburn welcomed the members to the eighth meeting of CIAG and thanked members for attending. He noted that Ms Hyslop had been detained by other meetings and asked him to step in as chair.
Mr Hepburn noted that we were in a changed world. While we had met in person at the last meeting in March we were unable to do so now. We were all used to working by distance meetings. He noted that members would have the opportunity to contribute.
The agenda included a number of items for discussion: how we consider and ensure that we take the creative industries forward out of the pandemic, the public health impacts and the wider economic impact; the challenges of the sector and how to support businesses through a very difficult and challenging time. The Scottish Government had commissioned significant reports to help to see what needs to be done – the Report of the Advisory Group on Economic Recovery, chaired by Benny Higgins, the Report of the Sub-Group of the Enterprise and Skills Strategic Board and the Report into independent industry groups – and these can be discussed through the agenda.
Bob Last noted that we are in extraordinary times. He noted that this meeting was his final one as co-chair, as had been planned. He announced that Brian Coane will be the new co-chair.
Bob noted that from its inception, the group has provided an opportunity for the sector to speak to the Scottish Government; this had been invaluable and important. It is most valuable when members were constructive in looking to find ways to support the sector and its ambitions; not when asking for money. Many members were dealing with distressed businesses – even more strongly now. He suggested that the Scottish Government had done a good job to help the sector and freelancers through the pandemic, though there was still a very long road ahead. While he had been busy with work he hoped that other members had managed to survive the ups and downs, while recognising the non-linear business patterns of the sector.
Minutes of Previous Meetings and Matters Arising
The minutes of the previous meeting were noted.
Impact of COVID-19 on the creative industries
Members were asked to set out the circumstances their sectors were in and what they saw as the way forward.
Craft had opportunities as well as issues. The sector had a lot of resilience, creativity and creative thinking. There were challenges in micro-businesses, the immediate loss of income and digital capacity, especially digital skills (though there were enormous opportunities to do it more digitally, and to be creative and innovative in the way that digital is used). Making was used as a diversion by people during lockdown and it should be considered a part of health and well-being.
The meeting papers recognised creativity. There had been many initiatives, which was also a challenge in understanding what was going on.
The live music part of the music sector had been devastated. There were ongoing negotiations with Government on support. The sector appreciated the funding through Creative Scotland. The parts of the music sector that could function were finding working challenging. It was not feasible to sustain live parts of arts in general for an unknown length of time until next year. There was a need to look at hybrid models of live and digital. Festivals and events were doing some great innovation but the numbers in the audience were insufficient and sponsorship and funding was needed. There is a need to look at the music sector more broadly and to maximise opportunities. Some parts of the music industry, which were multi-faceted, were doing well. There could be a move to IP and revenue.
Artists shared some of the position of craft regarding micro-practitioners and the overwhelming complexity of funding, including identifying where practitioners fitted in. Everyone had spent the support that had been provided by the Scottish Government. On fiscal incentives, there was a need to look at public art commissioning and collecting, including existing art that has not been purchased, rather than new ideas. There was a need to utilise advice from the sector. Creative Scotland should not have a middle layer of administration. The Sculpture Placement Group had enabled sculpture to be loaned to organisations. For the value of public art in the fiscal stimulus, not everything needed to be digital.
Fashion and textiles covered a breadth of activities. Factories and micro-entities had furloughed their staff. Support was welcome but information was sometimes overwhelming. There was a broader challenge regarding consumer behaviour and the shift in shopping patterns. Fashion was focused around live events and buildings (shops). There was a need to move money into new ground. There was some good news for example in the significant amount of digital and opportunities in digital and immersive. The question was raised – what are we going to do with the high street and where do we go?
In the textile sector most companies had lost 15-20% of their headcount. They had been very buoyant for several years prior to the pandemic. The main challenge had been skills and new people. Though there had not been any major fatalities in the sector, there was an expectation that one or two businesses would close in the autumn. Businesses were starting to focus on a no-deal Brexit which is expected to have a significant impact on the sector. The end of duty free shopping will be a significant issue for the tourist market. It was under-estimated how many tourists chose locations with affordable products. There was pivotal work to try digital services and develop online business and to invest in equipment and technology.
The design sector was in a very frustrating position. Design and architecture were absent from conversations though they were key for delivering construction and transforming digital. The sector was unsupported by the Scottish Government and would take generations to redevelop. There was wholesale loss and the sector was in survival mode. Construction had some future but there was great uncertainty and redundancies were being made. There was a need to get a new vision. Design was invented in Scotland for the Industrial Revolution and it needed to be supported. The sector was looking to get purchase wherever it can, get collaboration, and use its entrepreneurial skills; support was not about money but finding solutions to get a way forward.
The largest impact on advertising was the uncertainty around the economy. It was difficult to know how successful businesses were though this depended on their impact by the pandemic. There were challenges in digital, as well as in production, such as film and the practicability of producing work, a crucial point. The end of October will be a critical turning point.
On entrepreneurship, there was agreement with the points that had been made. One entrepreneurship business had been working with 1,800 people (of which a significant number were in the design sector) across 32 local authorities. This had generated significant data. There was a lot of work being undertaken to support other sectors to understand the creative industries. For the creative industries connectivity and sharing were important. The design sector in particular was in a challenging place. There were a lot of people with multiple incomes, PAYE, freelance and businesses that had fallen through the gaps in support. However, there were more new start up and more work globally, as in a boom and bust situation, which was enabling Scotland to be seen globally. However, talent was going elsewhere, though it was still based in Scotland. The challenging time would be from October to January. The sector was currently working with a shock and survival mentality.
Television programme production had halted everywhere. The freelance community was out of work. Companies were focused on development from broadcasters. There were some commissions in Scotland. The revenue in C4 and ITV had been affected and budgets contracted which will bring further budget challenges in going forward. Insurance was continuing to be an issue, but it was hoped that this would soon be resolved. The training providers had provided a lot of online training, including CPD, for freelancers. Screen Scotland had been proactive in providing support and was listening to the sector. Working remotely has given rise to significant complications in the talent pipeline, but also opportunities. For animation, the restrictions – which have been hugely challenging to implement especially for small to medium sized enterprises - had provided an additional production cost of 20-30%.
The pandemic had amplified the differences between publishing in Scotland and London. The decline in the Scottish industry had been shocking. London publishers were worldwide conglomerates with significant resources and could be supported by holding companies. Their digital models are a decade ahead of many Scottish businesses, the most successful of which are now at risk of being acquired by the global conglomerates. Many Scottish publishers are smaller, viable businesses, however, urgently needed to be more competitive. Their negotiating position with Amazon, for example, is limited. The challenge for the sector was catching up with the conglomerates to develop a more sophisticated digital / physical model. People were still reading, the UK-wide sector is resilient, but Scottish publishers are vulnerable. The Scottish Government needed to develop a digital development piece. Academic publishers, specialising in non-fiction and education, are ineligible for culture funding.
Video games had a relatively positive outlook at the moment. By its nature it was completely digital. The challenges were organisational. There had been an accelerated move to remote business which was not previously a strength of the sector. Recruiting was underway and some positions that could not be previously filled were being filled. There was investment in digital infrastructure, especially for remote collaboration. Collaborative thinking was difficult to undertake, a point also made for other sectors; the sector would miss a trick if it lost this ability to collectively meet and work together on ideas. It needed to consider how it could get a collective experience back. The Logan Report was welcomed.
The third sector echoed a lot of the points that had been made in the meeting. There was a concern at how the new Recovery Fund would fit for trading organisations. Links between the creative industries and health were highlighted. There was a need for a conversation on opening up markets and the public sector and what creatives could offer.
Digital tools and infrastructure were absolutely critical and simple. There was a need for a greater band width and greater digital capacity.
Mr Hepburn commented that every sector had fundamental challenges but had demonstrated a fair degree of adaptability, especially for digital aspects of matters and the use of digital platforms which appeared to be reflected in their contributions. He noted the need to have a good infrastructure and skillset to harness digital. He welcomed the Logan Report, commissioned by Ms Forbes. It was important to remind ourselves that we were not at the most difficult period as this would come at the end of October with the end of the Furlough scheme. There were concerns at the wider impact on the economy and sectors including the creative industries. He was engaging with the UK Government to push through interventions to stimulate the economy. He noted that the support and provision of assistance from the Government was welcomed though he was aware that there were gaps that needed to be considered. The Scottish Government was constrained beyond what fiscal powers it had. It was helpful to get feedback.
Officials noted the points about being overwhelmed by different support schemes and the challenges of navigating the support that had been provided. The country was in an unprecedented situation. It was important to identify resources and money and to get them out as quickly as possible. The landscape had changed with the £97m in support from the UK Government.
On setting out the support provided for the sector, officials noted that broadly, there had been support for the creative industries through PERF and the Creative Industries Bridging Bursaries. The Scottish Government was currently looking at the £97m for the culture and heritage sectors. Some elements of a funding package had already been announced, while work was ongoing with Creative Scotland for additional support for freelancers.
The Scottish Government and Creative Scotland were currently using existing funding models and delivery mechanisms for the sector, while also reaching out and making use of existing bodiesto assist them. Creative Scotland was aware that existing funds would not cover everyone in the creative industries. The Scottish Government was happy to pick up discussions.
Mr Hepburn noted that in the early phases of the pandemic it was imperative that money was deployed as soon as possible. He noted that he wanted to be informed by the experience of what support had been provided so that lessons could be learned. He noted that the Government had never had to deal before with a global pandemic.
Commenting on the freelance scheme of Creative Scotland, one member noted that risks had been taken. While the scheme could have been abused, it was suggested that there had been little abuse. The scheme was considered to be bold and helpful and that was why it had been so effective. In response, one member agreed and noted that the immediate response had to work through trust. The scheme had shown that this worked. People had asked for what they needed. The model for the Event Scotland Fund should be looked at as it seemed to work and be of benefit. The Bounce Back Loan scheme for sums of £500 to £25k had been really easy to access and this should be available all of the time. This echoed concerns of the CIAG sub-group on the SNIB regarding the ease of getting hold of loans. Trust was of key importance: it was interesting to see that it took a pandemic to bring about this change. Sectors such as textiles had made huge use of the Furlough Scheme as well as the Large Business Interruption Loan, which had been easy to access, though for large businesses not all schemes were applicable and some were specific for SMEs. Difficult decisions needed to be made.
The live part of the music sector was not able to access all forms of support. A small handful of crucial companies, undertaking production, were currently at risk and if they were lost then the infrastructure to support live events would not be able to function. This would also bring about a talent drain. The sector was willing to take on loans. However, production supplies were procured through hire purchase repayments which are ineligible for loans. It was asked whether support, including support from the SNIB, could be provided to assist with this issue. It was noted that the bank, which was working on a commercial basis, would be up and running later this year and the creative industries could benefit from the bank’s missions.
There was the increased threat of redundancies from October. Parts of the creative industries had learned that they could operate from home. It was asked whether this would help to address the green economy and reduce carbon footprint and encourage community working. It was considered that the recovery of the creative industries could link in with the green economy and its agenda. However, it this was more complicated than it appeared, for example in the film sector with the streaming of films and going to the cinema.
The Third Sector Resilience Fund organisation model was considered to be worthwhile and to have a fast and easy process. Creative Scotland had put out a call for parties to deliver the Hardship fund. However, the language was not as clear as it could have been. Social Investment Scotland was considered to be a good addition. There was a need to make people aware that they were able to apply to SIS. Gateways of good intention to the sector were important. Sector organisations needed to undertake responsibility.
The green economy was noted for fashion which was not just about clothes but their impact on the environment. We could not ignore the problems and challenges of an industry that was trying to survive. It had an impact on the environment and the closure of spaces. There was a need to consider the opportunity for redeployment and the repurposing of people and places to net zero targets. What emphasis and dialogue could be achieved around it and working around fragile businesses?
In Glasgow recovery work was being undertaken through the Creative Economy Strategy. This focused on a circulatory economy which would become net zero. There was a need to find solutions through collaboration, and look across sectors; a siloed approach was less likely to deliver resilience and sustainability. The design sector was good at undertaking this type of work.
Ways forward for the creative industries out of the COVID-19 pandemic crisis
The following were the main points on what the creative industries needed to survive:
Publishing needed to have regular ways to share information and problem solving and learning from other sectors especially the content led ones. A subgroup or a forum of content led businesses that have something in common could be explored.
There could be a one-off payment like the Event Fund for freelancers who were piecing together income from a number of income streams. This could be like the Hamlyn Awards. A public art fund will be critical. This could fund a person to look at how to get artists for public arts commissioning. Connections under cultural practice that look to the wider environment could be made.
The games industry could provide guidance for other sectors which were not au fait with the field. The InGame facility in Dundee was seeking to bridge digital with other sectors. Projects included building a simulation tool for orthodontists. Government assistance, such as promotion, would be useful. While the sector was in a good position short term – though it saw distress elsewhere – it was aware of challenges in the medium and longer terms. New content was being made. The consumption side, for example in arcades and virtual environments had restrictions placed on them and needed targeted interjection.
There was a presumption of survival until covid-19 has been beaten. If there was not a vaccine there would be a different longer term landscape. Mr Hepburn noted that he did not want the current bottom line to be the reality. Scotland was currently in the response phase, and the Scottish Government was trying to put in economic recovery. The Scottish Government did not have all the fiscal leavers – it was currently trying to sustain people, and as many people, as possible. There was concern that the impact could be larger than the virus. It was important to look at other thinking to provide support. Support was also going to be needed from the UK Government. It was important that we can think creatively and get people to get up and run with the resources that they have and to learn from them and embrace all of them and to act in that way.
For art, events and a one off payment were important but collaboration and better working together were key. The sector needed to be doing that anyway and to reflect on it.
Some television companies were doing relatively well. There was a need to look at the large number of freelancers, remote working and challenges. Mental health was an issue that needed to be considered. We need to consider what is the purpose of our offices and how do we use them in going forward? We also need to think creatively about how we use the working week for creative work. Digital communication had been more robust and people have been able to adapt. However, teams needed to work together in a way to ensure a collective creative endeavour. Much activity was being carried on but everyone was struggling to some degree.
Advertising was working where it could undertake production which brought in film and photography. There was concern that businesses would stop advertising; this would affect the supply chain. Advertising needed to be supported as it drove the economy. Creative space was important. Collaboration in office space was not suitable at present. How could we create new spaces?
In summing up, Mr Hepburn noted that the discussion had been helpful. There had been some sector specific examples while a lot of the discussion reflected wider issues regarding the economy and the changed nature of the world of work. He did not think that we would go back to the pre-covid world of work. This brought challenges, including mental health challenges and opportunities as well as geographically, and was a wider discussion. On information sharing and dialogue he was happy to look at this and to think about the requests that had been made and to come back on them.
AOB and date of next meeting
The co-chair noted that he was pleased to work with the group and to support Ministers. He hoped to see members outwith the group when we are able to meet. Mr Hepburn thanked the co-chair and he also noted thanks on behalf of Ms Hyslop for his enormous role in taking forward the agenda, and he hoped to hear further from him. The new co-chair, Brian Coane, said a few words of thanks to Bob and introduced himself as the new co-chair. He noted that he would be in touch with the members. Members thanked the retiring co-chair for his work and leadership of the group.
Post meeting note
The next meeting will be held on Wednesday 17 March 2021, 10:30am-12:30pm.
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