UK Government Snubs Video Game Industry

Paul Jackson, the director general of ELSPA (Entertainment & Leisure Software Publishers Association), the UK's video game trade body is disappointed about yesterday's budget as no tax credits were made available for game development.

In a statement released today, Jackson states that:



This is a strong statement from a body which, according to a source close to its inner workings, prefers the softly-softly approach to defending UK game development from brain and revenue drain.

This makes it difficult to understand exactly why ELSPA is disappointed that Chancellor Darling's budget. There have been no publicly released statements from either the Treasury or ELSPA indicating any firm mention that this budget was going to introduce a French-style tax credit scheme.

That scheme (ratified by the EU in 2007) offers any company incorporated in France as well as French subsidiaries of foreign parent organisations a tax credit equal to 20% of most game production expenses - capped at €3-million (£2.3m) per year.

The expectation that the industry might have hoped for such a benefit could have come from a behind-closed-doors expression made to ELSPA by the Exchequer. It is more likely, however, that it came from the Labour government's working paper, 'Creative Britain: New Talents for the New Economy'. This was released last month and made mention of the UK's video game makers as follows:



At the time the paper was released, ELSPA highlighted and warmly welcomed the above statement as one a "benefit from several specific Government commitments...".

As SPOnG pointed out at the time, the wording in that statement clearly states that the only commitment was that awareness of the existing scheme would be increased. In short, nothing would be done to extend it and certainly not commitment to include the development of video games was promised.

It would appear, however, that ELSPA is preferring to use its negotiating power in more low-key form, stating that despite its disappointment, "...positive discussions continue with the Treasury and we are hopeful of persuading them of the economic argument to support our case in due course."

We look forward to 'due course' becoming 'right now'. In the event it does not occur, would the last developer to leave the country for Canada or Australia please turn the lights off?