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June 4, 2018

The scale of BFI development and production funding

In a recent conversation with some filmmakers, I was asked about the amount of money the British Film Institute (BFI) awards to British films for development and production activities.

I thought it was a great topic for an article, so I agreed to take a look.

The BFI is a public body which, among other things, awards money raised from the National Lottery to people, projects and productions which will help the British film industry.  In the past, the BFI was primarily a cultural and heritage organisation but in 2011 its remit grew when it was given Lottery funding responsibilities from the newly-shut UK Film Council (UKFC).

How significant is the BFI’s financial support to UK films?

It’s hard to understate just how much of a significant role this money plays in the UK film industry.  In the seven years between April 2011 and April 2018, the BFI handed out £222,604,086 – almost a quarter of a billion pounds.

Of that, the largest category by far was Production funding.  This is money to be spent on the film’s budget and amounts to 45% of the money the BFI has awarded.  They also support projects before they are ready to be shot, covering development and pre-production costs.  These account for 8% of their awarded funding.

Interestingly, it seems that in the last few years, the BFI is moving away from some of the project-specific programs filmmakers seek out, and instead are increasing awards to events and programs focused on film audiences. This change in focus is most likely connected to their goal of increasing the geographic diversity of BFI-backed activities, pushing back against the industry’s London-bias.

It’s worth noting that the amount the BFI awards has been increasing in recent years.  In the tax year ending April 2018, it awarded just over £31 million – way above the £21.5 million it awarded in 2015.

Let’s focus on the development and production funding aspect which sparked this article.

BFI development funding

Filmmakers are able to apply for money to aid the development of their film project to cover activities such as:

  • Pay screenwriter(s) to write drafts of the script.
  • Fees to secure the underlying rights to the existing material, such as a book.
  • Research costs associated with the project.
  • Paying the film’s director for their work during development.
  • A contribution towards the producer’s overhead and fees.
  • Legal costs linked to gaining the rights needed to secure the script or underlying rights.
  • If the script is nearly ready then the BFI could also fund work related to casting, scheduling, budgets, location recces or even the production of a trailer or pilot.

The average BFI development award last year was £19,434 – much less than the UKFC’s high of £35,896.  As well as diminishing amounts, the number of development awards has also fallen considerably.

BFI production funding

Filmmakers can also apply for money to go towards their production budget (i.e. the costs involved with shooting and completing the film).

In recent years, the BFI has been providing fewer production awards but putting more money into each film, on average. Recent large investments include Early Man (£2,000,000), The Girl with all the Gifts (£1,780,000), Under the Skin (£1,673,744), An as-yet-untitled Chris Morris Project (£1,500,000), Peterloo (£1,461,000), Swallows & Amazons (£1,451,975), Country Music (£1,400,000), and Where Hands Touch (£1,400,000).

Although the recent investment averages look similar to that of the UKFC in the early 2000s, I feel that it’s unlikely the BFI will return to the nakedly commercial investment model the UKFC followed.  Partly because the tastes of those in charge appear to be less commercial and also partly because the business imperative is different.  The UKFC had to make money to pay their (in some cases very large) salaries whereas the BFI is not as dependent on investment profits.

The biggest UKFC / BFI project-specific investments to date were all made in the early 2000s, the largest of which were Sunshine (£6,661,423),  Notes on a Scandal (£4,587,768), Bright Young Things (£3,000,000), The Magic Roundabout (£3,000,000), Five Children and It (£2,671,500), Valiant (£2,580,645) and Sylvia (£2,497,643).

Note: These figures include all UKFC awards to these productions, not just for production.

Double dipping

It’s an oft-repeated belief among producers that if you want production funding from a public body then it makes sense to initially apply for a small amount of development funding.  If you’re successful, then by the time it comes to applying for the large amount you need for production, you’ll have got to know the body and they will be invested in the success of your project, both financially and emotionally.

While the data doesn’t reveal how much getting this initial development funding helped, it does show that there is a lot of overlap between the projects the BFI backs in development and then again in production.  Almost two-thirds of recent production funding awards went to projects which the BFI provided development funds for – a very different picture to ten years ago when it was only one in ten.

The genre of BFI-back films

It’s hard to know the genre of all the projects receiving development funding as there is often little-to-no information released about the contents of the film (plus, as it’s at a very early stage the genre could change throughout development).

However, we can look at the films receiving production funding.  Perhaps unsurprisingly, dramas make up over two-thirds of the films supported by the BFI.

When we compare this to the genre of all films made in the UK we can see that the BFI is looking to support particular types of films.

Do BFI-backed films make a profit?

The BFI is far less concerned with its investments making a profit than the UKFC used to be.  As discussed above, the BFI does not need returns to ensure its survival.  In addition, they have created schemes such as the BFI Locked Box which mean that some of the money the BFI makes on its investments doesn’t go into its own coffers.  Instead, it’s held back to be accessed only by the writer(s), producer(s) and director(s) of the profitable film, to be spent on the development and production of future film projects.  This is a fantastic scheme which works towards making the UK film industry a little bit more sustainable and allows the creatives of good projects to turn their success into a longer-term advantage.

By piecing together information that the BFI releases in various places, we can see how much each BFI-backed film has repaid of their funding award.

Of the 249 films I found that received UKFC / BFI production funding between 2003 and 2017 and who have already generated some income, just 36 have repaid their investment in full (i.e. 14.5%).

The BFI’s most profitable investment by far is The King’s Speech, which has returned a whopping 895% of the £1,021,080 it was awarded.  In the tax year ending in April 2017, the BFI received £77,718 from The King’s Speech, which brings the current total to £9,135,707 .

Below are the recoupment figures for a selection of top-performing BFI-backed projects.  As you can see, even hugely successful films recoup the vast majority of their eventual income in the first few years of release.

Sadly, we don’t know the deal terms for each BFI award investment.  In most cases, it appears that the BFI took an equity stake in the film, meaning that they get a share of the returns in perpetuity.  This can be seen in the huge returns the BFI is making on its King’s Speech investment.  However, for some older films, it seems as though the UKFC was repaid just the sum they invested and no more.  For example. The Last King of Scotland was awarded £1,396,791 and repaid £1,396,792.  While it’s possible that this is a coincidence, it is much more likely that the UKFC only agreed to be repaid their initial sum, with no profits, no premium and even no interest on the money.

Notes

For readability, I have used a few shorthands in this article, including:

  • I refer to ‘BFI-backed films’ when some of these movies would have been backed by the UK Film Council.  The BFI took over the UK Film Council’s responsibilities with regard to lottery funding in 2011 when the UKFC was hastily shut.
  • When reporting financial data, the years refer to tax years.  Therefore, “2007” means the period between (and including) 6th April 2006 and 5th April 2007.

The raw data in this project is far from clean or consistent.  I’ve done my best to ensure that my numbers are right but it’s possible that the odd error may have crept in.  Therefore, if you’re going to use these figures for something important (i.e. complaining that you’re owed money) then please go back to the BFI source documents first.  If you need help navigating them, just drop me a line.

I created my own classifications for how the BFI spends its money.  I found that some of the official categories the BFI uses are very broad, and in many cases don’t reflect the money’s actual application.  For example, Film Fund money has been used to fund projects related to the following types of activities:

  • Audiences & Events
  • Development & Pre-production
  • Distribution (International)
  • Distribution (UK)
  • Documentary
  • Education & Training
  • Post-production & Completion
  • Production
  • Promoting Britain
  • Short film
  • Slate funding

Therefore, I re-classified each Lottery Award with categories which better reflect their use.

Films were assigned up to three genres each, hence why the totals on the genre charts add up to more than 100%.

Epilogue

One frustrating part of this topic is how hard it is to assemble recoupment figures.  In theory, all the information is public, but it is spread across so many documents, in unhelpful and changing formats.  It feels like the BFI know they have to publish the data but they don’t want it to be easy to access in any practical sense.  It would be extremely simple for them to share this information in a usable way (as they do with the amounts they award) but instead, they have chosen not to.  Add to that, a couple of years ago the BFI changed the way they report this data, doubling the number of places you need to look for each film in each year and reducing the overall amount of information they release about each film.

The lack of a single place to view this data in its totality, the awkward documents and the changes in reporting all reflect poorly on the BFI’s commitment to “openness, transparency and accountability“.

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9 Responses

  1. Tom_S June 4, 2018 at 10:02 am #

    Excellent that you have taken the time to analyse the income v awards for all these films, well done! Crazy that the BFI have this info but keep it to themselves. I recall seeing a BFI job advert for an analyst specifically to include overseeing recoupment status of projects, so they do it but want to keep this aspect of spending our public funds very private. Are you able to list the other films? It would be very interesting to see how certain types of films perform. If you have missed any data … well the BFI can release their records to clarify.

    • BMF June 5, 2018 at 11:25 am #

      I would second the above!

      Or useful to know what percentage of films fit into each 10% band of recoupment ie how many 20-29% recouped, 30-39% recouped and so on. There is a perception that film is riskier than other sectors, but having followed the progress of “crowd funding” across various sectors on Crowdcube, Seedrs etc, there are just a handful of profitable exits so far and a mass of 100% wipeouts where nothing is left. Businesses that have an ongoing trade seem to trade into oblivion with zero cash left. Case in point is the current furore over the collapse and fire sale of Sugru. Whereas investment in a film is creating an asset that has value even if the film is loss-making overall. So film may not only be less risky in terms of profitable exits (certainly based on 14.5% returning a profit compared to crowd funding), but the data may show that you get back on average most of investments where a profit is not reached – this type of breakdown would be very useful.

  2. Nick Ryle June 4, 2018 at 12:31 pm #

    This kind of analysis is so valuable to producers; many thanks from a grateful one. As a documentary producer, the tiny commitment to our genre over the years is disappointing at a time when the market for docs is growing. And sadly, this is further reflected in the paucity of the new Doc Society administered fund.

    • Stephen Follows June 4, 2018 at 12:35 pm #

      Thanks, Nick.

      There will have been support for the documentary world outside of just that category. For example, funds going to a film festival which screens docs would show up under Audience and Events.

      For each award I had to pick a primary category, but in the real world most activities cover a few different areas. For example, if that fictional festival I just mentioned ran a training panel then the overall award would still be in Audience and Events but some of that money would be spent on training. Complicated topic to reduce to a pie chart!

  3. Paul June 6, 2018 at 10:11 am #

    Stephen. You might want to check those development spend figures as the BFI devolved all their debut feature development funding to the various national screen agencies from 2013 onwards via BFI Network. If not accounted for it would artificially depressed the figures spent on development.

    • Stephen Follows June 6, 2018 at 10:31 am #

      That’s a great point. I will check.

      • Stephen Follows June 6, 2018 at 11:12 am #

        Ok, I took a look. The short answer is, I *think* what I’ve put is right, but I am totally open to being wrong and updating the article accordingly.

        The long answer is that the awards data come from here bfi.org.uk/film-industry/funding-awards and, as I mention in the article, the BFI’s classifications don’t do what I need for this article. So I have assessed the (scant) information the BFI give on each award and then classified them within my own categories. All awards the BFI class as “development” are in my development category. There are some referred to as “Targeted Development” but I think they are not referring to feature film script development.

        Looking for the shift you mention, there are 156 awards linked to Network. Some very big (i.e. Organisation Awards and Funded Partners) and some very small (i.e. Film Academy – Regional). The majority seem to be linked to “Audience Development” but there are a few that certainly could be eventually spent on feature film development (such as the £200k to Creative Scotland for “Film Fund”).

        As I’m not sure on those vague terms, I’ll leave the article as is, but will also go back to the BFI to ask for more info. If they confirm that some or all of it is development spending then I’ll update the article. In the meantime, this comment chain should serve as a caveat that it’s an open issue.

  4. Nick Parfitt June 18, 2018 at 12:16 pm #

    I would also be interested in seeing the recoupment in more detail, as suggested above split into bands so the data is more general, not focused on which films flew and which flopped. Perhaps in 5% bands?

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