Deal to secure Scots film studio just ‘weeks away’

Culture Minister Fiona Hyslop MSP. Picture: TSPL

Scottish Enterprise has disclosed details of a new private sector firm which has emerged as the surprise front-runner for the long-delayed project.

The agency, which has spent more than two years examining sites for the project, said the latest proposal would deliver one of the highest soundstages in the UK if it went ahead.

It is said to be “exceed the specification” of a proposed development blueprint issued last year in a bid to generate international interest in a Scottish studio.

Culture secretary Fiona Hyslop has insisted she is hopeful the film studio will finally get off the ground by next year, insisting she was “determined to deliver,” but admitted she does not “hold all the cards”.

She told a Holyrood inquiry into the film and TV industries that the new private sector proposal was being “actively” pursued after the scrapping of a controversial tendering process launched almost a year ago and insisted it would “meet industry needs.”

Ms Hyslop also said that recent European Commission rulings had made it “quite clear” that the public sector could not take forward its own proposals for a film studio, as it would breach state aid rules. Such a move had been recommended last year by an official study on options for studio schemes in Scotland.

It is understood the new proposal is not linked to ongoing proposals for two other sites, at Straiton in Midlothian, and on the Clyde waterfront in Glasgow, near BBC Scotland and STV’s headquarters.

The favoured film studio option put out to tender last year was estimated to cost around £15 million and would have led to the creation of two sound stages, along with workshops and production offices, but a preferred site was never announced amid fears over the impact of the state aid regulations.

Ms Hyslop was asked by committee convenor Murdo Fraser why the Scottish Government had yet to allocate anything from a separate £2 million loan fund set up in October 2013 to support film and television production infrastructure.

Ms Hyslop insisted the government was involved in “live and current discussions” to finally get the studio venture off the ground.

He said: “The film studio delivery group put out a call for applications for private sector investments in a studio which, if they so choose, could access that loan facility.

“That’s not been drawn down because there isn’t a proposal going forward as part of that original private tender process.

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“But what I can you about where we are currently is that Scottish Enterprise has a new proposition which has been put forward that will provide the specifications that we were looking for in the development brief put forward last year.

“Should that be successful it would provide the highest sound stage of any location in the UK. That would be a significant step forward in providing a large studio space for inward investors.

“The challenge is that this is not just about large productions. It is also about supporting the indigenous film industry on a smaller-scale. Those are live and current discussions.”

Ms Hyslop was asked by fellow MSP SNP Joan McAlpine about the prospect of the current government finally ending the “long-running saga” of Scotland’s attempts to get a film studio off the ground.

She said: “Yes, I’m determined that we will.”

Scottish Enterprise, which has been given responsibility for taking the lead on the film studio concept, has been under fire for the failure to make any announcements in previous evidence submitted to Holyrood’s economy committee.

However after Ms Hyslop had appeared before MSPs, the agency issued a statement confirmed it was close to an agreement with a “private sector developer.” Hours before her appearance, she announced an additional £3 million for the sector, to help attract big-budget film and TV productions to Scotland and encourage skills development.

David Smith, creative industries director at Scottish Enterprise, said: “We’re pleased to have received this proposal, especially as our initial assessment suggests that it exceeds the specification laid out in the original development brief.

“This means that. if successful. Scotland would have one of the highest soundstages in the UK and crucially would represent good value to the public purse.

“We’re working towards completing due diligence and agreeing heads of terms with the developer within the next eight weeks, at which point we will provide a further update.

“Achieving this date is dependent on an acceptable deal being reached with the developer. We will continue to work alongside the Scottish Government and Creative Scotland to deliver effective support for the screen sector in Scotland.”

A spokeswoman for the Scottish Government confirmed that none of the options examined by the film studio delivery group as part of the tendering process were now being taken forward.

She added: “The Scottish Government established a £2 million loan fund which remains available. The investment can be utilised by private sector partners to develop proposals for film and television studio space for Scotland. Any opportunities to utilise this fund will be considered by public sector partners on a case-by-case basis where relevant EU State aid rules are adhered to.”

Meanwhile Ms Hyslop also admitted public sector quangos responsible for Scotland’s troubled film and TV industries need to work better together - but denied the government was taking “a sticking plaster approach” to the screen sector.

She insisted it was benefiting from more funding than ever before in Scotland, with funding now up to £24 million, up £8 million from the SNP came into power.

the culture secretary said it was a “happy coincidence” that an additional £3 million has been announced for the sector just hours before she was due to appear before MSPs.

But Ms Hyslop told the parliamentary inquiry that she acknowledged there was “a tension” over the different remits of Creative Scotland and Scottish Enterprise.

Finance secretary John Swinney, who also appeared before MSPS, said it was “crystal clear” that final responsibility for leadership for the screen sector lay with the national arts quango and pledged to address any “contradictions” in their respective remits that emerged from the inquiry.

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