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Towards a National Film Policy (1949)

Harold Wilson MP
President of the Board of Trade

I start from the proposition that all film finance, whether private or though the NFFC, depends ultimately not only on production and distribution guarantees, but, so far as the end money is concerned, on a guarantee or high prospect of circuit release. The decision on a film's prospects of circuit release is taken in effect by two men—the appropriate authorities for the Gaumont-Odeon circuits and the ABC circuit respectively. However much work the NFFC may do on the financial standing or even the quality and prospects of scripts, etc, in the last resort their action is largely conditioned by the decision of one or both of these two gentlemen.
        These two are therefore dictators in the matter of deciding which films are made and by whom; the whole prosperity and also reputation and prestige of British films therefore depends on their judgment. As the Department responsible for films, most of the effectiveness of our long-term policy in the end depends on the rightness and wrongness of their decisions.
        There is an additional argument that on the general question of censorship I am not satisfied that the decision as to which films are made should rest in the hands of two irresponsible Eastern autocrats. I am also pretty well convinced that in the case of one of them the decisions taken are made on the personal likes and dislikes of individual producers. You and I have heard statements by authoritative people in the industry on this point.
        One possible and radical solution would be to bust up the circuits. This may come in the fullness of time; I hope it will, but I do not consider it a likely development in the immediate future and although I think we should keep it in our minds as a long-term objective, I am not sure that we ought to pursue it as a national policy in the months that lie immediately ahead. Apart from anything else, some proportion of the losses on production are still being made up by circuit profits and to bust up the circuits or to divorce them from production (as in America) might lead to a drying up of such sources of finance as are at present available.
        But the time has come when we cannot allow national film policy, economically, morally or artistically to be dictated by these two Oriental potentates. The power of the circuits must be broken, or at least severely limited. This is not an undue interference with private enterprise or the rights of shareholders. Individual shareholders, I suspect, have no control whatsoever on at least one of the two gentlemen to whom I have referred, and in any case once a private undertaking has reached the size of these organisations and has assumed power of a quasi-monopolistic character, it is quite appropriate that that power, if the State permits it to be continued to be exercised, should be circumscribed by such safeguards for the public interest as the state may decide.

Source: Memorandum to R C G Somervell, Under-Secretary in charge of the Films Branch at the Board of Trade, 25 September 1949

See also quotation from Wilson's speech of June 1949

Notes
NFFC National Film Finance Corporation
Harold Wilson later became the longest serving Labour Prime Minister (1964-1970, 1974-1976). After his resignation he was appointed chairman of the Interim Action Committee on the Future of the British Film Industry, which later became the British Screen Advisory Council (BSAC).

David Fisher writes:
The 'duopoly' in UK film exhibition, widely regarded as undesirable (except perhaps by the exhibitors concerned) and investigated officially on several occasions—including two references to the Monopolies and Mergers Commission—was never 'busted up'. It had been created, or at least consolidated, in the early years of the Second World War. In quick succession in 1941, J Arthur Rank acquired  full control of the Odeon chain, plus Gaumont-British Picture Corporation and the Paramount chain of showcase super-cinemas.
        The duopoly continued for nearly another 40 years after Wilson's strongly worded statement until the mid 1980s. In April 1986, the Australian media owner Alan Bond bought the Screen Entertainment division of Thorn EMI, principally comprising the ABC circuit, for 110m and sold it a week later to Cannon Classic for 175m in a deal also including Elstree Studios. Alan Bond, as I wrote at the time, 'cleared around 40m profit in a week; Thorn EMI shareholders may wonder why they didn't'.
        Ironically, Cannon had already built up a substantial ranking as a third circuit through acquisition. Cannon's purchase of the ABC chain created the largest circuit in the UK and strengthened the duopoly to the highest proportion of screens ever. This not only followed the worst ever year for cinema admissions (1984) but coincided with the beginnings of the multiplex era.
         The first UK multiplex, AMC's The Point at Milton Keynes, opened in October 1985. It was this new phase of investment in new cinema building—around 55 years since the start of the generation of super-cinemas for the talkie era—that finally broke down the power of the duopoly. Control of film exhibition was a matter about which government continually expressed concern but which it was never willing to tackle.

 

Contemporary documents index
Palache Report 1944, which had raised the issues Wilson was addressing
1949

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