Government Toys With UK Games Makers

Despite cutting a tax break to the games industry, the government is funding the cradle of Grand Theft Auto

Despite cutting a tax break for game developers in the emergency budget, the coalition government says it is committed to supporting the industry.

Speaking this week at the Develop games developers’ conference, minister for communications Ed Vaizey re-announced £2 million of funding – already announced by the Labour government – to help small companies to create game prototypes. The fund is being managed by the University of Abertay in Dundee, where an undergraduate founded the company which created the Grand Theft Auto game

“Government recognises the difficult challenges faced by the UK video games industry in the wake of a new economic climate,” said Vaizey. “It is an industry that has real potential to create the high quality jobs of the future that will be so important as we recover from the recession.”

Outrage Over Tax Break

The government also welcomed an independent review of education and training in the UK games sector to be spearheaded by Ian Livingstone OBE, Life President of Eidos,  and carried out by NESTA and Skillset.

“We need to invest in talent that will ensure the UK remains at the forefront of games creativity.  That is why it is important to focus on skills and on giving small companies the support they have been telling us they need to help them take forward innovative new games concepts,” added Vaizey (above, centre).

But despite this pledge of support for UK gaming, the government chose to cut a tax break for the games industry in last month’s emergency budget. Chancellor George Osborne decribed the break as “poorly targetted”.

Games industry trade body TIGA this week announced that it remains intent on persuading the government to introduce video games tax relief or a similar measure to help support the industry. “Since the coalition Government abandoned plans to introduce Games Tax Relief in the June Budget our members have been extremely vocal in their outrage and dissatisfaction,” said Dr Richard Wilson, CEO of TIGA. “TIGA is committed to getting Games Tax Relief introduced in the UK and we are delighted that our members remain united and defiant on this issue.”

Also commenting on the tax break issue, Jason Kingsley, TIGA chairman and chief executive and Creative Director of games maker Rebellion, said: “It’s not just about keeping existing jobs, it’s about new jobs. The UK can only compete against our international competitors if we’ve got the Government on our side. This means that the Coalition Government must look again at the case for Games Tax Relief.”

The funding for Abertay was first announced by Labour’s digital minister Stephen Timms in February. The investment will help with the expansion of Abertay’s computer games centre of excellence – to based in Manchester – which could help create 30 new companies and assist 80 others, the government said in a statement at the time. The investment should also “stimulate” 400 new jobs across the UK, the government added.

Games Generated £3.31 billion

According to figures released in February, the UK is the fourth largest producer of computer games in the world and the largest in Europe. “Last year the UK games market generated £3.31 billion for the economy, with video games software sales accounting for £1.621 billion,” the previous government stated.

Rockstar North, developer of Lemmings and the Grand Theft Auto series, was founded in Dundee as DMA Design by David Jones, an undergraduate of the University of Abertay Dundee, the University’s website claims. But despite its success, the Grand Theft Auto series has attracted – and courted – controversy over its casual violence and depiction of crime.

The decision to support the home of one of the more controversial video game makers shows a change of heart form David Cameron, who has attacked violent video games in the past.

“Today’s document sets out our view on popular culture – that the companies which make music videos, films and computer games have a social responsibility not to promote casual violence, the gang culture and the degradation of women,” Cameron is reported to have said in 2007.