 Rwebch chi, mae'n gweithio ar eich mynd i fewn i ddechrau cyntaf, inni dda i l Barcelona. Rwy'n meddwl ar gael cychwyn nhw i fan i'r mor insufficient. A fydd y trof y t defnyddiaeth. Rwy'n meddwl i ddau'r cychwyn nhw i'n meddwl i'r holl el mail, a i'r holl el mail i'r trof y tleid, i ddim yn iawn a'r holl. Rwy'n meddwl i ddau'r holl, i ddim yn iawn i ddim yn iawn. That is the easiest thing here, it would be—initially, if we went around—the toolbox and just introduced ourselves and said who we were. My name is Mordo Fraser, I am the convener of the committee and I am MP for Mid Scotland and Fife. And I'll hand over to Dennis Robertson. Welcome and good morning. I'm Dennis Robertson. I'm the deputy convener of the committee I am the SNP member for Aberdeenshire West. Mike MacKenzie, SNP member for Highlands and Islands region. Good morning. My name is Brian Baglow. I am the head of the Scottish Games Network and Games Partnership Manager for Creative Skillset. Trogbrodie, SNP MSP and one of the MSPs for the south of Scotland. David Archibald, I am a lecturer in film and television studies at the University of Glasgow. Margaret McGregor, I am a Labour MSP for West Region. Fiona Lohg, director of Craft Scotland, the National Development Agency for Craft. Richard Baik, a Labour MSP for North East Scotland. Gregor White, I am director of academic enterprise in the School of Arts, Media and Computer Games at Aberdey University. Alison Johnstone, MSP for Lothian. Gillian Berry, co-founder of Sigma Films and founder of film city Glasgow. Marko Biaggi, MSP for Edinburgh Central, with just a little bit of a constituency interest in the industry. Georgina Foratt, University of Dandy, director of design and action knowledge exchange of the creative economy. Joan McAlpine, SNP member for the south of Scotland. Thank you. We have the official report, which is being said on our Clarks, Diggy Wands and Diane Barre. We have about 90 minutes or so for this session, and it is an opportunity for us as members to try and explore with our guests some of the issues around the creative industries. The focus for us today is to try and understand where we are with public support for the industry. What are the key issues of public policy that are currently supporting the industry, or perhaps more interestingly, holding it back? If there were particular policy changes that you would like to see implemented, what would these be? We have seen your written submissions, which are very helpful in terms of framing the discussion. We have about 90 minutes. I want to make this a free-flowing discussion, but I need to share this in order that the broadcasting and official report can keep track of who is saying what. If you want to contribute, if you just catch my eye and I will bring you in and members want to ask questions of particular people, just catch my eye and I will bring people in as best I can and let everybody get a fair crack of the whip. If at any point you want to say something, just put your hand up or try and indicate to me and I will bring you in. I wonder if I could maybe just start by asking a question to our individual witnesses and let everybody get a chance to say just a little bit on the record just to get things going about general public support for the sector. There is quite a lot in the written submissions about the role of Creative Scotland and the role of the enterprise agencies in supporting the sector. I just wanted to get a flavour of what people think that is, whether they think that it has been successful, is it sufficiently targeted, how that might be improved. Maybe I could start with Brian Baglow here and just work our way around the witnesses on that particular issue. First of all, I have to say that the support from—sorry. Don't touch any buttons. They will all be controlled by broadcasting. I will put my hands down here. First of all, let me say that the support for my own sector, the game sector, has been incredibly strong from the Scottish Government from the outset. Well before Westminster agreed to table the tax breaks issue, the Scottish Government had really thrown its weight behind the game sector and agreed that this would be of benefit to a very exciting and dynamic industry. The games industry itself has received a lot of support from the commercial industries, the commercial organisations, over the last two decades. From the very earliest days that Scottish Enterprise recognised the internet existed, they have really thrown their weight behind the game sector. One of the main reasons that we have such a diverse and dynamic industry here in Scotland is thanks to the commercial organisations and the public sector support that we have, so I really can't fault them on that front. However, because that predates the formation of Creative Scotland, we fell into the commercial only aspect of industry. We had absolutely nothing to do with the Scottish Arts Council and we had only just, in the shape of myself, started talking to Scottish Screen as the merger process began. We have not really had any of the legacy as a cultural or creative industry in the last few years. That is something that we really have to address moving forward. This is a UK-wide issue. Games, for the most part, in the UK are seen as things for kids. They equate to digital toys and therefore have very little, if any, cultural impact. My contention is that interactive media is fundamentally changing every aspect of the creative industries. At some point, somebody is going to need a programmer, somebody is going to need to create something engaging and, dare I say, fun. At that point, they should be coming and talking to the games industry because that is what we do. Maybe just to pick up on that, I will go to Professor White next, just as you are more or less in the same field, to see if you want to add anything to that. I agree with the history of games that Brian has described. I think what the industry does very well is that it reinvent itself in cycles and responds to technological advances and other changes in the business models. Things have been characteristic of that. There is a risk of lumping the games industry under one banner. I think that there are probably three games industries in Scotland. There is Rockstar North, which is its own economy. There is a layer of companies that are reasonably well established now. I have been running for some time and have a fairly steady income stream. I know how to operate in the marketplace. There is a sort of start-up layer that is very interesting at the moment. It is very dynamic, very high turnover, and it is very difficult to quantify and manage in the traditional ways that public sector agencies have worked with start-up companies. I think that there is a risk that we do damage through the traditional ways that we look at start-ups. Organisations such as Business Gateway will ask companies to establish themselves as a company and go through boot keeping courses and all sorts of hurdles to jump over before they start to access these services. The people that are in that space are much more dynamic, much more fast-moving than that. They might not be so interested in creating a business, much more interested in creating a product. How we cater for that layer is a really interesting challenge for us at the moment. It is almost like the R&D wing of the industry. That is where the exciting things are happening. That is where they are working with medics, that is where they are working with architects, that is where they are working with the oil industry. There are much more experimental groups of people at that level. I think that that way of working is probably a more comfortable fit for Creative Scotland. I know that they have had issues about conceiving how games fit within their portfolio, but that kind of community is much more familiar to them probably. Organisations such as the Cultural Enterprise Office have also had trouble fitting games into their start of R6 programme. That environment is a really rich one, a really interesting one. If we step back from saying that you are a startup and that this is the hoops that you will jump through, there is a lot that can be done to support that sector in a different way. The other side of the agency in public sector intervention is on the skills side. I think that the skills agenda has been dominant now for 10, 15 years in the game sector, driven mostly by employers. I would say that large employers who are looking for kind of moral functional graduates to enter a large corporation, again that landscape has changed completely now. The graduates need to be much more multifunctional. They need to be able to fit into small companies very well and be able to take up a number of roles within that company. We see the graduate skills side changing and the demand for skills changing, but we have still got this imbalance with the larger companies dominating a discussion about skills, and we are still getting this interpretation of what skills should be and what graduate skills should be from part of the industry that is actually now a tiny fragment of it. I am keen to go round the table and let all the witnesses have an initial say. Maybe we can move on to film. Gillian Berry, perhaps. Do you want to address the same question, Gillian, about public sector support? Do you feel that sufficient? What has your experience been of that? I am sure that most of you will be aware of the film sector review that was published in January of this year, so I think that everybody has a very clear idea of the state of the film industry in Scotland at the moment. Prior to Creative Scotland, we had Scottish Screen, and there were 35 people looking after the film industry, but for the last five years, there has only been less than a handful within Creative Scotland, although all those individuals have been fantastic. There simply is not enough as many people as there should be looking after us. Crazy Scotland only looks after the production side of films. No one has looked after producer development or company support for the past five years. Therefore, there is a crisis in the industry. We still punch above our weight in terms of international output and quality, but the number of 100 per cent independent full-time producers and stroke production companies in Scotland is probably less than a handful now. If film is the cake and development is one of the main ingredients, we are the cream and the sugar, and we are finding it very hard to survive. In the same vein, I will bring in David Archibald. The question of how Creative Scotland serves film, but there is a general, I do not know if you just want me to address that, but there is a bigger issue there, which is about how Scotland's fund relates itself to film and compares it to its neighbours and producing statistics in the report that points out that Scotland spends less per person on film per year than its neighbouring countries. Is public spend or is box office spend? No, that is public state support. The comparison between Scotland and Denmark is that, even before last week, the Danish state announced that it was jacking up enormously. Its increase is more than the annual total Scottish spend. That is what Scotland is a small nation. One of the things about Scotland speaking English is that it has certain advantages in the international film market, but it has considerable disadvantages as well. In comparison to its neighbours, one could argue that Scotland does not serve its film industry very well in terms of state funding. That means that there is a disconnection between the amount of people who are very talented and who can make work in the state funding that they receive. I mentioned in there that there is a Royal Society of Edinburgh funded study, which has identified recently a trend where young people who are trained here are leaving Scotland because of the opportunities that are not there for them. That is a broader, Creator Scotland cannot solve that problem. That is beyond the remit of Creator Scotland as to do with funding. In relation to Creator Scotland, my perception is that among the filming community, they do not think that Creator Scotland is the best format for them to operate under and that they would prefer if there was a dedicated film agency that could look at issues to do with commerce and culture and that they had one specific organisation. I am not saying that that is my experience, so I have not dealt with them directly, but that is what I would suggest to the Scottish film making community. That would be their main thing. I mean, just as a matter of interest, I mean, just go back to Gillian for a second. Is that something that you would agree with, Gillian? Yes, we are one of the only countries in Europe that does not have a dedicated screen agency, so absolutely. I think that there is work happening this week. Scottish Enterprise and Creative Scotland are joining the independent producer Scotland group at a workshop on Thursday to talk about and find ways for those two agencies to realign and collaborate to help the film business. However, they have very different agendas, so it is not impossible, but we will take some work. Can I just take one more? Yes, please. I mentioned it there, but it is the question of a film studio as well. I mentioned in my report my evidence that there has been considerable discussion about this in recent years, but I recently found out that there was a Scotsman editorial in 1944, which talked about the establishment of a film studio in Scotland. It is like if you look at studio development, so again, that is beyond the remit of Creative Scotland, because they do not, so that is something that the Government has to address. I am sure that there are some members here who read that editorial at the time. Speaking personally, I was not one of them. The very interesting point, in fact, one of the things in my list I wanted to come back and discuss later was the issue of the film studio, because that has been kicking around for such a long time. Before we move on, I want to bring in Fiona Logh next, just to talk about the broad question of public support. The craft sector in Scotland comprises about 3,500 individuals who are working professionally as makers. However, despite that small size of a group, it is not a homogenous one at all. That leaves many of the people working in craft feeling sometimes uncomfortable about being placed in the creative industry sector. Many of them see themselves very much like an artist, producing one-off, fantastically designed, wonderfully conceived pieces of art that will be bought by galleries and collectors, so they do not always see themselves as wanting to go into trade and production of multiples. That is where the creative industry side comes in, and that is where we sit within Creative Scotland. It has improved an issue so far in terms of funding, but it seems to be able to deal with the flexibility. In the recent round of bursarates for creative people, six craft makers got awards, so despite where we sit in terms of just making a distinction, that does not seem to be too much of a problem. We are pleased with the overall support that we get from Creative Scotland and the service that we get from it. Personally, Craft Scotland, as an organisation that is 10 years old, has just received three-year funding for the first time, so I am one of the lucky ones. That shows a commitment to the sector from Creative Scotland. We are pleased with that, along with increased funding for Northland's Glass up in Wick in the north of Scotland, a new funding for the Duffcourt Studios in Edinburgh, which we are delighted about. I think that my challenge comes with some of the other agencies trying to work with them. There are huge opportunities for craft makers in things like tourism, for example, and trying to knock on the door of Visit Scotland and work with them about developing that as an opportunity to both add value to visitors coming to Scotland or indeed making a reason to visit Scotland has been incredibly challenging. Also, in terms of taking work abroad, trying to get through the maze of Scottish Enterprise, SDI and UKTI, I want to tell you the challenges that we have there. When we speak to people internally, they cannot even help because they sometimes cannot work out who is doing what. We find that challenging not to create money for us but to make sure that we are aware of all the opportunities that might exist in terms of trade missions or opportunities to go and see overseas so that we can share that, not necessarily for us to be doing it but so that we can make our sector aware of all the opportunities that exist. The other point might be on local authorities. There is a bit of a postcode lottery there where some local authorities are very good at supporting crafts, so places like Fife, where we have Fife contemporary art and craft, if you have to live there, you will get a great deal of support. Dumfries and Galloway, with the spring fling, activities going on there and the recent work that they have been doing through the cabin network have been excellent, but Edinburgh, Glasgow, there is no extra support in the major cities where most makers are situated. I was trying to think that there was one other. The other bit about the postcode lottery is that craft used to be a long time ago supported by Scottish Enterprise and when it changed its remit to the larger sectors, responsibility was passed to Scottish Arts Council and then to Creative Scotland. Highlands and Islands Enterprise still gives a lot of support to what they call fashion and text styles, but through an organisation called Emergence, they can support a lot of smaller craft makers, perhaps people working in jewellery, which can be counted as fashion. If you happen to be a jeweler living in the Highlands and Islands, you may be able to tap into two lots of support, i from Highlands and Islands and also from Creative Scotland, where us makers in the central belt can't. For me, it's about joining up all those dots and all the potential opportunities that are there, and just somehow making it all work much better. We take a slightly different perspective on the way in which we operate and that we work with all designers irrespective of their discipline, so we have text style designers, games designers, designers from all across Scotland. What we do is we try and put design at the heart of new businesses, so we will scope a call, we will hone in on a sector, we will put a proposition up and then we'll bring a lot of people together, about 20, 25 to 35 people, and we'll look at developing an idea and by placing in each team a designer. A designer is there to help generate the ideas and move the agenda and really spark new thinking and the way of doing business. The thing that we have found is that there is an absolute overwhelming need in the small micro and small SME sector. It is absolutely enormous and insatiable in some ways. We have been deluged by over 500, I think it's now reached about 700 companies coming towards us because the complexity of the environment within which they're operating is so difficult for them to manage and manoeuvre that they simply can't get through the systems. You have to be quite a sophisticated business to know when to operate or when to access a particular training scheme, you have to have the resources to allow you out of your business, how do you run your business when you're going to go and do an accounting course or various other programmes that are on offer. They're there but the means by which these small businesses can access them is limited. I think the other thing that we're experiencing as an organisation that is driven to bring businesses into the economy is that there is very much a stem model being used for the way in which all of these organisations operate. They're using very much a science engineering model and they're not looking at the creative economy in a sympathetic manner or developing a dual way of approaching funding for the different types of sectors. Everybody has to go through the same process and it's easy if you're stem because you have the kind of metrics that are needed for that approach and that is very much resource-based resource enhancement bringing people in to do jobs whereas if you're in the creative economy you are much more mentoring, it's much more person-centric and it's a different type of model and there seems to be an unwillingness in it. We've just witnessed with the funding council and Scottish Enterprise who collaborated to bring innovation centres together. Creative industries was in their first line of attack and first call and they failed round one, they failed round two because there wasn't the infrastructure in Scotland to support them because they needed to be led by a large industry. Well the industries were all talking about a small and based on a small individuals, small companies and so we didn't have the critical mass to make the bids work. Now we know that the textile one has gone ahead but it's gone at a very modest cost compared with the stem subject so it seems that the creative economy is missing out on opportunities and ways in which it can build its infrastructure because the approach is not sufficiently sympathetic to our sectors and so I find that very frustrating and I just echo what all my colleagues have said in their frustration of joining all the bits together not for us but to make it work for the businesses that we're trying to to grow and to ensure are there within the economy. That's been a very helpful summary from all of you as to where we are. I've got a number of members have already indicated to me they want to come in. I'll start with Dennis Robertson. Thank you, convener. There seems to be a common theme I think from you all and in the terms of there seems to be a very complex infrastructure that you seem to be trying to sort of work through. I mean I know that I think it was yourself first of all that mentioned the account management from Scottish Enterprise, the threshold of £400,000. Do you think that we should be looking at ways of reducing the thresholds for people to get into account management and look at sort of removing some of the barriers for people to understand the complexity because it shouldn't be complex. I mean there should be a portal basically that you should go through and should be getting that appropriate advice to move forward, whether it be in crafts, whether it be in film or whether it be in gaming, in terms of accessing the appropriate funding. There is just recently, just in the last few days, the open project funding from the Government. It's 30 million over three years. I'm just wondering if that's maybe a source of funding that would be open to your particular sectors. Professor Follett, first. I'm sorry, I'm not aware of the open project funding and how to access it, if I haven't had time to go into the depth of that. The businesses that we're supporting, we've found that £20,000, with a very simple application form, say a one or two pager, absolutely helps that business produce R&D and build itself into the economy and keeping everything in one place, not making people move across agencies and across sectors, and we're finding we've got people who go from pillar to post. And so I think there needs to be a recognition that we have an economy based on very small scale businesses and we need a methodology for them to access funding that is simple. So I would agree with you absolutely, we need a new way in. Is there a role for the Federation of Small Businesses to assist in managing that process, do you think? Yes, if they can help, they know the problems and so theoretically they could help design a system that gave access better. Gillian Berra, I think. We have a similar problem in film, you're absolutely right, that this 400K threshold is impossible to meet to access the SE funding for the majority of the producers. So they suggested to us that we form a cooperative, which we did independent producer Scotland, 40 members, and we together with Scottish Enterprise modelled the ideal infrastructure for the film sector, and we applied to Creative Scotland regular funding. Sadly our application for 3 million was rejected two weeks ago, however there is a possibility that we may be able to apply through the regular funding, the open funding or the targeted funding, and it seems that when the smaller businesses come together and act to behave co-operatively, it's easier to obtain the funding. Professor White? I don't agree that there's a problem with companies accessing the agencies last night off the top of my head. I could name 13 agencies in Scotland that in some way purport to support the games industry. My record is 16 but I wasn't on form last night. The complexity that is being described about the sector is also part of its vibrancy. Part of the balance that we have to find is not regimenting these creative people neatly into the funding streams or profiles that agencies are comfortable dealing with. We need to live with that complexity and dynamism. The games industry is obsessed with Finland. Finland seems to be getting it right at the moment. Part of what they do is incubate really well, so they incubate people and not companies. They have a great incubation space. If one person goes in, you can hire a desk and sit down. If you need somebody to help you, you hire another desk and sit down. If you get to 10, you get thrown out and get told to get an office. However, you do not have to be a company to get into the building, which is one of the very important things. It is very easy to access small amounts of seed funding for those that we could potentially look at. The Finnish industry is great because it has a large technology company that is very interested in investing in the infrastructure. Nokia put a great deal of money into that space, and that is something that we do not have in Scotland as part of the ecosystem. The area that I wanted to cover has been covered. I had noticed that Scottish Enterprise had almost been conspicuous by its absence from the comments from filming and gaming, but I wonder whether I could go on to a slightly different topic. That was to pick up on something that was in Professor Follitt's submission, which was about research and development in creative industries. I understand quite easily what research and development is in the life sciences. What material is research and development in the creative industries? Research and development in the creative industries for individuals is obviously different, but what they are trying to understand, if they are trying to run a business or gain a living from the creative economy, is how they can function, what their skills will enable them to leverage and how they can make their businesses work. They need access to world-class experts and access to a problem, a real business opportunity. For a small business to find its own market, that is quite complex. If what we are doing is scoping a market, if they come into us, they have immediately an opportunity to create a business that has a market for it. They need research to understand where the market opportunities are and where the business opportunities are. What are the new business models? Business models are quite limited at the moment. We are seeing a transition, if you like, from a push economy to a pull economy, where we are seeing very much more service industries develop and there are no real business models for them to grasp. They need research in helping them to build appropriate models for the kind of businesses that they want to deliver. Those are the main things that we have found from working with all those individuals. They need a business opportunity, they need to understand it, they need an opportunity to talk to experts and really understand the platform that they are planning to deliver to. Then they need help building business models that enable them to flourish. Search and development. I have been fortunate just to come back from Chicago, where we took a group of 13 makers to a large international exhibition called SOFA, Sculptural Objects and Functional Art. We selected the makers through open selection, they had to apply for it, and then we had an external selection panel. The makers knew back in February that they were going to this exhibition. Part of the selection process was why they wanted to go, why they thought it was important to the development of their work. Many of them want to access the US market. In order to really make a show there, many of them had to up the game in terms of the work that they were producing, because the work is larger, it has to be more developed, it has to be right for that market. That group of 13 people have been spending time since February until the work was shipped in September, creating a whole new body of work that would be right for that market. That is the type of research and development that needs to happen. It can be an internal thing in terms of the quality of your work and the direction that it is going in, as well as the external thing about business. Is it interesting to get public funding for that? We got money from Creative Scotland to support who does it, but many of the artists had to fund their own passage there. Is industry-wide enough incentives and pressures, positive ones, to ensure that constant re-examination of what you do and pushing innovation forward, or is it the case that some could cost and not be challenged by that? As individuals, I think that the desire to innovate and progress has to come from the individuals themselves. If they do not have the passion and drive to do it, it will never happen. I suppose that what we want to do is to make sure that the environment is right to support those who want to make that move. There is some funding in place, but more could be encouraged. I guess that that is something that is inherent in your industry, but perhaps in gaming there might be a tendency for some to do what an American might call cookie cutter industry, just to plug in stuff out. The game sector is notable for the one constant that is evolution. New devices appear on the market all the time, new technologies, which spur not only new types of content but new routes to market, new business models and entirely new audiences. The entire games industry changed fundamentally in July 2008 because Apple launched the app store. All of a sudden, instead of needing a large team, millions of dollars up front, two guys in the back bedroom could sit together and knock a game out that would stand just as much chance of making money as something like Grand Theft Auto. This is the challenge that the games industry specifically is facing, which is that the industry as a whole is running to stay still. We are constantly being pushed forward. As Gregor said earlier, there are almost three distinct games industries. The one that everyone tends to think of is the console market, the Xbox's, PlayStation's and Nintendo's. That is a vanishingly small percentage of the industry in the UK and an even smaller percentage of the industry here in Scotland. Most of the companies out there now are looking at the new opportunities, the new routes into market, which have much lower barriers to entry and offer almost as many rewards, but it comes down to understanding the devices, the routes to market and the new business models. The games industry is almost schizophrenic at the moment because when games work, they work incredibly well. Grand Theft Auto V, for example, the month that was launched last year, the same month, it made more money than the global music industry averages. It made a billion dollars in three days. It has to date made more money than Avatar, Titanic and the Last Two Harry Potter movies put together. Minecraft has revolutionised how families and children feel about video games. No explosions, no headshots, no rescuing princesses. Instead, it is creativity, it is almost digital Lego, but those are very much the exceptions. We have a growing number of companies now that are trying to understand an increasingly saturated market and find ways to innovate and differentiate themselves from the hundreds of millions of creators that are out there in the world today. The console market is almost a red herring, which is a given in a way. In Scotland, according to our own research, about 94 per cent of the companies that are based here are doing casual, social, mobile and online games, and those are still evolving incredibly rapidly. In 2012, Facebook was going to be the biggest platform for gaming in the world. It did not happen because one company managed to break it for everybody else. For me, that comes back to a very fundamental issue, which is that people get into the games industry and I suspect into the rest of the creative industries because they want to create. People get into the games industry and they want to make games. Running a company is a by-product. As a result, we have a number of people who have succeeded, despite not knowing a huge amount about business or they have made their business work over the past 10 or 15 years, but we are not innovating. One of the things that we suffer from in comparison to Finland is a lack of business skills on the creative industries. We do not have too many people who are going out there going, you know what, maybe free to play is not an evil monster that is going to kill all games and mean that we die penniless and alone in a bus shelter. Instead, if that is the reality, how do we innovate? How do we make use of this and find ways to make it work for us? The reason that we are not having the international financiers coming in, the venture capitalists coming in, to the UK as a whole, but Scotland specifically, is that very few of the companies in my sector certainly are investment ready and are very unlikely to be so in the near future. As the parent of a six-year-old and five-year-old, I just want to agree completely with everything that you said about Minecraft, Grand Theft Auto is not on the agenda, but Minecraft certainly is. Chick Brodie wants to follow up some of this. If I may, good morning. Just on the last point, Brian, by the way, I have to say that I am surprised at the figures that over 50 per cent of the jobs in creative industries are in Glasgow, Edinburgh and Aberdeen. There is a proud Dundonian. I am surprised that we are not, we don't feature more largely. In terms of running a company as a by-product, of course we need innovation. The problem, though, is that if I look at some of the numbers that we have in terms of very small businesses, how do we qualify, or who qualifies, or should we be qualifying the products that come forward in a much more meaningful way so that funding is much more focused than it currently is? It seems to be almost anarchy in terms of how funds are distributed. Specifically on the games side of things, there is no funding out there. All of the companies that are out there right now, and there are probably about 90 plus in Scotland at the moment, more than 50 per cent in Dundee, you will be delighted to hear. Most, the vast majority of the games that are coming out of Scotland are self-funded in some way. They are either bootstrapped, they are from companies that are using the proceeds of their previous game in order to finance them, or they are making use of their own funds. There are very few companies that are bringing in any kind of finance. Following that on, one of the comments—I am not sure who made it, Gregor—in terms of business skills, I mean, innovation is great and we have the creativity, but at the end of the day you may say that it is a by-product, but unless the substantive business skills—why we've got people who are creating products and running off to do accountancy courses—surprises me. Are the business skills there the knowledge of the industry there where you can get business mentoring or business gateway doing the job that you should be doing? Do they understand the industry in the same place as Scottish Enterprise? If I may jump in again, I think that one of the issues is that there is an awful lot of support and opportunities out there, but as I am Gillian and Gregor have both highlighted, you could spend your entire working life just finding out who's out there. At my last count, there are 35 organisations, public sector and otherwise in Scotland, that are involved in the game sector in some way. 35? 35? 35. From Talent Scotland? How many of them overlap? That's a very good question, if you can help me find out. We go across the board from Scottish Enterprise, Scottish Development International, Cultural Enterprise Office, Creative Scotland, Arts and Business Scotland, Talent Scotland—that was a new one on me. BAFTA Scotland's creative skills set is— You said that one was on display at Scotland Park last night. I refuse to answer that question on the grounds that I might say something unfortunate. However, there is support out there, and we do have a lot of organisations that can help people to go out and set up their businesses. Business Gateway actually does a fantastic job. The reason that we have grown from six companies in 1997 to close to 100 in 2014 is because Scottish Enterprise and Business Gateway are fantastically good at helping businesses to start up. It's how those businesses are then incubated through to being successful and commercially viable. That's the issue. At the moment, one of the biggest issues is where does Scottish Enterprise stop and Creative Scotland start? What does Skills Development Scotland do? Where does Talent Scotland come in? All of those different organisations have different offerings. However, if anybody here can point me to a map that shows what they all do and how it works and how it links together, I would be absolutely astonished. I totally agree with you. It's the commercialisation of the idea that it's the real issue for those businesses. They have the skillsets to produce the ideas, to prototype them and to get them to a stage pre-commercialisation. It's the infrastructure to commercialise their products that is the big gap in the market and how they take that idea. They're very good at creating one or two or 10 or 15, but how do they create 10,000 or 100,000 pieces? That's the gap in knowledge. Helping those companies to get that expertise into them is very difficult, which is why I think the route that we've been taking is to try to partner them with another business so that they can learn from people who are already in the marketplace. Mentoring is a really helpful system, but we don't have enough mentors if you like to help with the commercialisation, nor do we have any experts who actually help with this commercialisation process. It's where we probably lose 80, 90 per cent of our capacity at that point. Having a business mentor, unless you have some understanding of the product of the service that you're offering. That's where it falls over at that point. In your paper, I find this quite interesting, having spent some time at Sanford University in California. You have the prototype fund, right? The Abertay University has, yes. You provide grants of up to 25,000 pounds for small companies, but Abertay University doesn't take ownership of any IP or equity created during a project. Why not? It's very difficult to exploit IP. As far as prototype was concerned, as opposed to the university itself, obviously, these were startup companies that came into the space. With existing IP and IP, they may have been tied up into other sorts of relationships as well with a publisher or partners within that. It's very difficult to exploit IP. IP is a larger idea. It's very difficult to exploit IP if you're handing over 25,000 pounds. That has to be a negotiating point. I didn't run prototype as a project. As I understood it, there was a clause within the agreement that expected a contribution back from the companies should they go into profit and should they go into profit in a significant way. There was a gentleman's agreement, rather than a commitment to reinvest it in prototype as a whole. There was an agreement. If you received one of the prototype funds, the expectation was that, as Gregor was saying, there is zero value in untested IP in the games market. There is potentially value in a prototype. The notion was to help people to create the prototypes that could then be sold. Should they come to market and have any sort of commercial success, there was an expectation that the money would be paid back towards the fund itself. I just find it difficult in lots of areas, but public money is invested in so-called winning products and the return as you might get the loan back, but I'm much rather saying equity where there's a greater return on public interest. I agree. Or cycle. I don't know if you recycle the money, but when you get the money back, that would go back into the project and be used to support future projects. There is an issue with IP for small companies. Yes, we take a share of the IP or we take an equity share in the company that we birth, one or the other. For the very small companies—and we've spoken to really quite large companies, middle-sized enterprises—protecting your IP is really difficult in the marketplace. We use the university as an IP shelter for the companies that we invest in and we support, because the university has quite sharp elbows, so if somebody treads on the toes of that company, we can use the university to deal with the legal aspects of that. For small companies, it's beyond where we're all to take them to task about it. We've seen Apple have problems and Samsung and Nokia and everybody else, so it is a difficult area. It's protecting IP. Again, from the game's point of view, we're creating more original intellectual property now than we ever have in the past. In 2013, Scotland produced 93 games, 86 of which were based on original new intellectual property. Minecraft and GTA side, if anyone can name me five, I've got a £20 note for you. It's not so much the creation or even the protection of IP. It's the exploitation of it and the commercialisation of it, again, which comes back to the business skills in order to make those things work in a global market. I'm really enjoying hearing the evidence this morning. Some of it is very well presented and entertaining. We're learning a lot. I feel that we're hearing a lot that's really exciting. There's obviously massive, massive potential in all those industries, but what I'm hearing is very, very frustrating indeed, because it seems that we're not joining the dots. There's a lot of disconnect. If we could just get our act together, I think that there's huge opportunities for individuals, for the economy and lots and lots of opportunities. I probably want to focus on the craft side and on the filmmaking. You were suggesting that Edinburgh and Glasgow, their investment in crafts and their interest in it, is lagging behind other parts of the country. When you think that Edinburgh is world known for its arts festival, it seems like a real shame. It wasn't least said that I was a councillor in Edinburgh for five years and now that you've mentioned it, I don't think that we discussed crafts once and the impact it could have. Obviously, when the festival is going on, there's lots of crafts that you see as you wander up and down the high street, but it clearly could be a lot, lot better. I probably would quite like to hear from Fiona and from yourself, Gillian. We heard that you suggested that film was in crisis in Scotland. David, you were saying that the Danish increase was more than the entire Scottish spend. We can see the impact that Danish filmmaking has had. We all discuss it regularly on a Monday morning when there's something on a Saturday evening. I'm probably just looking for one recommendation from you both. Is it a national agency and in crafts is it for each local authority to be investing in this area properly and making themselves aware of the opportunities? You're right. In Edinburgh, during festivals, you see a lot of stuff on the streets. I would hesitate to call it craft, I'm afraid. Some of it is very poor quality and I think that damages professional craft makers. A lot of those people are selling the work at prices that are just… I don't know how they sustain themselves, so a lot of people are doing it. It's a hobby, a lot of people, it's mass produced. It's a mug that's mass produced in China with a transferred printed image of Edinburgh Castle on it and people are buying it as a souvenir of Scotland. I find that very upsetting. I know that there's been lots of looks into all the tartan tach shops in the high street and I would ache. Thank you. I think that there is a real challenge for makers who are producing quality pieces of handmade work with locally sourced materials, sustainable materials, which may have taken days to make and people look at it and think that they're expensive and they may be expensive in comparison to the mass produced mug, but in comparison to how much time and IP and everything else that's gone into it, it's incredibly cheap. I think that that's the challenge. It's a conversation that I've tried to have with both the authorities in Edinburgh and Glasgow as the two major cities. I've tried to have conversations with the people who head up arts and leisure. Just to get on the agenda, that's part of my job. Craftscotland is a very small organisation. There are now five offices and I spend most of my time just out talking to people trying to raise craft on to people's agenda and so far have been fairly unsuccessful with both of the major cities. They listen to me but they pass me down the chain and say, we'll have an exhibition here or go and speak to this person there. I have to be fair in both of those cities. They do have a small arts and craft versus scheme that's matched by Creative Scotland. Now I don't know how much it is but it's probably a few thousand pounds so I can't say that they do absolutely nothing. But in terms of exhibitions in their galleries, there's nothing. The Museum of Edinburgh, it's all old craft-applied art. There's wonderful examples of silver, of glass, of ceramics that's been produced in the 16th, 17th, 18th century. Go on, try and see some wonderful glass ceramic that's been produced in the 21st century and you would struggle in either of those cities and that's one of the challenges for me. We are trying to use, there is a huge infrastructure of galleries all around the country, you know, whether it's the McLaurin art gallery in the air or the Dick Institute in Kilmarnock, you know, just thinking off the top of my head, there are lots of galleries and so I've set up a craft curators network trying to bring together the people that run the infrastructure, cultural infrastructure, to see if there's more we can do to support craft. There's obviously links here with tourism, very strong links that we should be building on, and clearly this affects, you know, those of, you know, people who use jargon like Bran Scotland, but if you're a tourist and you take home a, yeah, something that clearly doesn't have any longevity at all, it does reflect badly. Is this something that you discuss with Visit Scotland? Try to do that, but what I will tell you is one great success, and that's with the National Trust for Scotland. Yesterday, we, together with the national buyer for the national trust properties, of which there are the national trust shops, were putting a joint project together to have a Craft Scotland collection of work in their shop, so their head buyer is absolutely fantastic, understands that the people who are visiting National Trust for Scotland properties want to buy an original piece of work from Scotland, and so, hopefully, that new collection will be in the shops in May. Having proved the concept, I hope to roll that out to other people, like Visit Scotland and Historic Scotland, but it's wading through my time. It certainly sounds like a discussion that we need to have with the national tourism agency. Absolutely. Thank you. Can I just go on to... The universities have a specific role in showing off what they've created in the galleries. I'm thinking that the two art schools, Glasgow and Edinburgh, are probably the two best design in art schools that we have in Scotland. I'm sorry to Grace. I'm probably going to... My educational colleagues around the table might disagree with me here, but I have a big concern in that specialist courses in craft have now been removed from most of the Scottish art schools. There's still a glass course in Edinburgh, but if you're to look for a specialist ceramic course or a specialist weaving course, those have all been removed through the over the last several years. I have concerns about where the next generation of... Well, we're awash with jewellers and that's... We're awash with them and the reason the colleges still do that is it's very cheap for them because it's a small workbench and some small hand tools. You don't need to run a kiln. I really do worry about where the next generation of exciting crafters are coming from, but they do show the work in terms of graduate shows and a number of them do have some very good residency programmes for people who are out of education just for a couple of years and giving them access to facilities because that's one of the largest challenges for people. Alison. Yeah, just to drill down into why we're not taking the opportunities that investing in film will return, because I understand that investment has a fantastic return, you know, for every pound spent in film. We get 20 odd pounds back, I believe, so there are huge opportunities and we don't seem to be getting a grip, so I just wondered what, if we were to do one thing, what is it? Is it this national film school? What do we need to do? I think a dedicated screen agency would be fantastic because the synergies between film and screen should be encouraged and explored. We're at least five years behind both Northern Ireland and Ireland now. Ireland produces at least 20, usually 22, feature films a year and we're only about five or six. Return on investment completely varies, depending on, for example, Game of Thrones. For every pound invested, there's eight pounds return, but that's because it's concentrated in the studio. Sometimes in coming production, the economic return is less because the production is transient and disappears before you know it. Dedicated screen agency would be great. In the meantime, John Swinney asked for an immediate realignment of the Government agencies, Creative Scotland and SE, after our meeting with him back in March. We're still very hopeful that we're going to see that and that SE can really come in and start doing some immediate repair work into the infrastructure. On the wish list, of course, the film studio, as we've mentioned earlier on, would be, since we've spent 70 years talking about it, we need to put it in the right place. If it's not surrounded by an infrastructure, the odd hotel, a decent cup of coffee, a restaurant, airport even, some facilities companies, then it's not likely to succeed in the middle of nowhere, so that would be my major point. I hear the issue in terms of the studio, but what discussions have you had with the major television companies? If I look at the BBC studio, which I understand is not used a lot, have you had any discussions at all about utilising any of their infrastructure? Yes, Scottish Enterprise undertook a feasibility study and looked at over 300 locations in Scotland, including all the existing facilities. They are still in the process of due diligence and we're hoping that we'll hear something from them soon. Finally, David Archibald suggested that we need to up our game in terms of film education in this country. I think that 80 per cent of pupils in Denmark enjoy film education. Is it about 25 per cent here? What difference do you think that would make if our pupils had that opportunity? I think that children are entitled to a richer cinematic experience than they might get in Cineworld, for instance. It's one of the problems that Scottish cinema or filmmaking in Scotland has in terms of exhibition, that it has to compete with enormous economies of scale, so sometimes even when someone makes a great film, that doesn't necessarily mean it's going to be a successful film. I think that primary and secondary school level, if children weren't introduced to a wider range of cinematic material, they might develop tastes in that and therefore when they were older they might be much happier to go and see successful, small-scale, experimental or less blockbuster material. In terms of education, it's important that people get to experience stories that people hear make so that we understand who we are. At school level it's important that I raise the idea in that paper that I've raised previously about the idea that this would be a national film school in Scotland. It's in higher education. Most people who want to go to film school still go to film school in England. Although there is an organisation called Screen Academy Scotland, which exists in Edinburgh, it doesn't have, in my opinion, the oomf of a national film school. There's been big changes in film education and higher education institutions. There's a lot more happening. There's a lot more practical courses being taught at postgraduate level. I raised the idea at the Edinburgh Film Festival this year that it would be interesting to explore the possibility of having a national film school without walls, which tapped into the talents and skills, considerable talents and skills, of people in Edinburgh, Glasgow and the University of the West of Scotland. I think that that's definitely worth exploring. I just want to make one other point, which is about cultural value of cinema. Last week there was a film called The Possibilities of Endless. The possibilities are endless, or endless, I can't remember actually. The possibilities are endless. It received a five-star review in the Guardian, and it's a very small documentary film about Edwin Collins, and he struggled to produce music after having illness. One of the things that film can do—I'm not saying that games can't do it. I'm not saying that other art forms can't do it. Documentary cinema is fantastic for showcase in other aspects of culture in Scotland. There's another documentary, which is in the pipeline about the work of Alistair Gray. He's obviously got the big retrospective at the Kelvin Grove at the moment. Cinema can be really—there's the commercial end of cinema, and cinema has to negotiate at the industry, but there's a cultural value in cinema as well, which is worthy of investment. Perhaps The Possibilities of Endless, because it's a solo budget, it may end up making money. There's a filmmaker in Edinburgh, Mark Cousins, who is perhaps more well known as a critic, but who operates under the radar of funding. He's been quite successful, but perhaps if he had marketed more money, more people would see his work. It's not just a problem about making work. If he doesn't have a significant investment to market it, then nobody can maybe see your film. Gregor, I want to come in and then Brian. Need to be brief, please? It's a very brief comment. I have a visiting role at the film school in Copenhagen and I've spent some time over there. It's an extraordinary place, but it's very lavishly funded. It's not part of the education system, it's part of the culture department and it's funded through the culture department. It's a five-year postgraduate programme, and students work in production teams for five years and create a number of productions over that period. I won't vouch for the joys of being part of the culture department rather than the education department, but they see it as part of that investment package that they've put in place recently, as the education of the next generation coming through as part of that responsibility. Just very quickly, I think that there's a couple of very good points that you brought up there. The first, David, is that get your filmmakers to come and talk to us. We can get stuff seen on iPads and iPhones worldwide. I know the sanctity of the cinema-going experience is a really good thing, but in terms of a global audience, we're there, which brings me on to the second point—very brief, I promise. The bigger issue here is that we need to stop thinking about the industries in terms of silos. Film and games are becoming a lot closer. Visual effects, animation—all of the creative industries, in some way, are now having to come to terms with the realities of digital and interactive devices on the market. One of the dangers, one of the issues that we've had, is that film is treated entirely separately. Games has had a legacy issue of being the awkward kid in the corner that nobody wants to talk to. Moving forward, we absolutely have to recognise that we're all converging, that everybody needs to be talking to each other, because we want to learn from the film sector just as much as I think the film sector can hopefully learn from us. On film, we had Finland cited as an example of a good practice in gaming and what it does, and Denmark is one that we've heard a lot about for film. Is there a tension or is there a junction whereby you can go down a Danish root and emphasise culture, but there are other models out there that are more commercial, such as the Canadian provinces, Ireland and New Zealand, which I would guess would probably be in pure financial terms most successful? Is there a policy choice? Is there a divergence there or is it possible to be both? I think it's possible to be both, absolutely. So what should we do? I think that, given that Ireland is so close and they have put so much time and effort into developing a strategy that's clearly paid off, it would be a model that we should look at initially. Alongside explore the other models, it's not rocket science, I don't think. If there were a task force empowered to develop a strategy for the film industry that would transform it within a couple of years, I think it could quite easily be done. It's been done before. The considerable investment that they made in the Danish film industry was supported across the political board that it wasn't left the state intervention. I think that it attempts to straddle both cultural and economic. I'm not an expert on the Danish film industry, but two things are interesting, which is that a few years ago, and Gillian will know more about this than I do, but a few years ago they made the Danish film industry a strategic decision, or people involved in the Danish film industry made their strategic decision to attempt to move into English language co-productions, which they did very successfully with Sigma, Gillian's company, but also if you look at the success of their television industry in terms of the cultural products that they will be exporting, which are very good for the Danish tourism industry and will be very good for the Danish economy. It would be certainly worth looking in more drilling down considerably more detail to how they have managed to do that, seemingly very successfully, and then to the point that they are deciding to spend more money. Okay, I'm concerned with the time. We do need to finish the session at half past 11, because we have the minister coming in on another matter, so we are short on time. A number of members haven't spoken yet, so I want to start with Margaret MacDougall. Thank you. I find this morning's session very interesting. I think that there's a theme coming across that, if perhaps there was more collaboration between the different industries within the creative industry, because you can help each other, and even smaller businesses can help each other, as Georgina has said. My question is about crafts and on this collaborative working, because I noticed that you mentioned Fife as a good place to be, or was it Dumfries? We have one craft town in Scotland in West Kilbride, which happens to be in my area. Why isn't there more craft towns in Scotland? It seems like a good idea, and they've got a specialist niche in the market, from what I understand. Why hasn't that rolled out across the country? I'm not sure I really know the answer, but I know that craft town Scotland, in West Kilbride, came about because of very much the passion and energy of one individual, Maggie Broadley, who's worked incredibly hard to make sure that it happens. I think that's so often the case that it's a lovely model. The fact that it's within that small town, which was fairly run down, that the High Street Stone needs some improvement, that many of the empty shop units were bought through support from the Muffet Trust, I believe, and handed over to a local organisation, and a number of makers have moved in, and they can now have cheap access to studio space on condition that they open their studios to the public at the weekends. At the same time, the Barony centre, which was an old church, has been converted and turned into a lovely gallery. Part of the challenge there is that, to be honest, we've been trying to work with them on the tourism project, but unfortunately it's in a part of the country that many of the tour operators just don't want to go to. It's not quite enough of a pool, there's not enough else happening in that area that the American tourists want to go and see or do. The hotel in Roscoe Bride is still not really stepped up to the mark. The cafes are pretty poor, and if you go on a Tuesday everything's closed. I think that there's some very good ideas there, but there are many things that should be replicated, like fife contemporary art and crafts, or the open studios have proliferated throughout Scotland. Many areas now run open studios for artists and crafts people, but the challenge for me is, if somebody says, I'm going to Dumfries in June, and I say sorry, the open studios were in May, I don't know where they go to see crafts, so it's getting that all year round presence, engaging with the galleries that exist to try and have something on an on-going basis. It could be a model for other small towns, but it would need the energy of an individual to make it happen. Is there no funding that can help that? If there was a group of craft people who wanted to exhibit collectively, is there not that assistance there? For a group, they could apply through the open funding to Creative Scotland. If they found a venue, I'm sure, through the project funding, craft in Scotland would get most of its money through heritage lottery funding. It was large sums of money, it was millions and millions. Joint studio complexes exist around the country. Wasp studios, for example, have been going for a long time. There are now a number of independent studios, there must be about 50 studio complexes throughout the country, where artists and makers come together. For makers, the challenge is that four blank walls don't really do it for them, they need access to equipment, they need access to a kiln, they need access to cutting materials, there's a number of different special things. Models such as an equivalent of the printmakers workshops, which were set up for printmakers, and are in Glasgow, Edinburgh, Dundee, Aberdeen, Dunfermlyn, wherever, that would be perhaps a better model, so that studio space with equipment would work better. But some of that energy has to come from within the sector itself. It can't be talked down, it also has to be bottom up. If people want it to happen, I think that there are some ways of making it happen. But there again, you're talking about, there is the facilities there, there are studios for kilns. It just seems that this lack is that there is no one to bring it together, or do people actually know that they are available? Students coming out of college, it's always a challenge to the next step, and although I think that the colleges are quite good at giving some information, I think that the students head are just too full of producing their degree show, and so any training, they suddenly find themselves out, and what do I do? There is information on our website, there is information on Creative Scotland's website about the studio spaces, but how to find funding is a bigger challenge for people. I think that how to get themselves set up in business, most of them have to balance working part-time in a bar, or doing any bits of teaching that they can find to make themselves work. It's just a bit of a hard challenge, as it is for any creative individual. You also mentioned, in your introductory remarks, about exporting and this involvement with SDI. Have you looked at collaborative working on that? As part of our inquiry into export, we've heard comments about how it's so difficult to get a container and you don't have enough goods to fill a container, but partly on that and the collaborate and the share of the space in the container. How much of that goes on in the craft industry? I don't think that there is a great deal at all. It's something that we're starting to look at. To be fair, in the last several years, our organisation has focused more on the retail side of things rather than on the trade side, and it's a gap that I realise is there, and we're starting to turn our attentions to it, hence trying to have the conversations with SDI and UKTI. Certainly, when we take the work overseas, we ship it jointly for all the artists, so that that's easy for them, but I don't think that you've got individual people saying, we're all going to New York to do the New York Now show in January. Does anyone else want to share the shipping? Most of them will take it to be honest as hand luggage. You don't want to know how they get it. You're not going to break it in the market, so that's your case of goods, but... Okay, thank you. Thank you very much, convener. I'm co-convener of the cross-party group on culture and we had an evidence session on talent retention about six weeks ago. One of the things that came through quite strongly was the support, the business support for artists, and that would apply, I think, to games and to your own sector, Fiona. The artists union had conducted a survey of their members and found that 78 per cent of artists did their own negotiating, and a musician that we took evidence from talked about how there weren't the management structure in Scotland and the specialist lawyers, for example, just don't exist in Scotland and that means that people have to leave. I wondered what you thought of those findings and what we could do to address them. The way that I see it is that a lot of makers are attracted to come to Scotland here. Very interestingly, out of the 13 people that I took over to Chicago, there were probably only three who were born and bred and fully educated in Scotland. The other people have all either come into Scotland to study and stayed here because of the quality of life. We had two South Koreans, we had an American who was about to take up British citizenship, and a large number of English people who have all moved north of the border because they see that the support here is better. I am seeing it the other way around. I know that a lot of people here for postgraduate study will still look to London to the raw college because they probably still see that as the holy grail of going there, but lots of them go there and come back. I am not sure that we are losing huge numbers of creative people in our sector. I would say that there is a huge talent drain. If you think of the amount of agents that operate in London, there are simply thousands of them. There is not one in Scotland. Film and creative industries legal firms. Actually, there is one in Scotland. There is one lady that operates from home. The rest are in London. The expertise has gone. How could we build that up? Obviously, it is not something that is going to happen overnight if there was one thing that could improve that. We need to create an infrastructure. I think that this is a much bigger issue. In the game sector, we have more and more people coming out of our universities. We have four universities and six colleges producing game-specific graduates at the moment. Abertae alone has 850, Gregor. The number of large studios that can employ them has shrunk and almost vanished over the past 10 years. The opportunities are now largely entrepreneurial, which brings a smack bang back to how you set up on your own. What is it that you need and what are the services that you need in order to grow your business and make it commercially viable? We have a growing infrastructure in Scotland. There are a number of technology tools companies. We have business services companies, public relations and marketing. It is growing, but it is very much focused on those very small companies. We do not really have any one of a global profile. With all the people coming out of the large studios as they close or coming out of the universities, we are losing more and more of them to either other industries overseas or they are staying and setting up on their own. We have that initial kickstart through business gateway, but we have this whole black hole. You are set up, you are a business, good luck. We need to find a way of bringing people through and trying to make those companies commercially successful. Can I make a tiny point? It needs to be very brief. We are very short on time. It is beyond the remit at the committee about Emma. It is a footnote in my document that points out that a lot of significant artists came to Scotland, art school students came, and they were allowed to stay for two years. Because they were here for one year plus two, it means that they made connections, they were part of the infrastructure and they made an important contribution. Now they are not allowed to stay for those additional two years. They come for one year and they leave and they make a significantly less important contribution, but also less of them will come, which will be damaging to universities. The film fits into that category as well. They flag up Duncan Campbell, who is an artist, who comes from the art school from the MFA programme and is nominated for the Turner prize. The thing about film is that it is at the commercial end, but it is also at the Turner prize at the end as well. We retain a number of graduates for some of the reasons that Brian has described, and because there is a talent pool in Dundee, in particular, of games graduates, so that there is a richness to that community that can support the industry. However, just to flag up something that may become an issue in the future, is the financial time bomb of fees south of the border. This is the first year of graduates, I think, that will be leaving graduate from university with that extended amount of debt. That is going to put upward inflation on salaries in all of these sectors and the game sector and it is going to make south of the border look much more attractive. The film strategy against—obviously, that has just been launched, as Julian Burry was saying, but it is answering what you are saying that needs to change radically, even at its outset, if it is going to succeed. We have a strategy. We have not had one for a long time, so we are delighted to have one. However, given that there is market failure in the sector, it is a Government concern and perhaps it requires an intervention. In terms of Government and public funding support for the industry in Scotland, how does that compare with the UK as a whole? You said that Northern Ireland is a specific level of investment, but how do we compare to other parts of the country? Yes. If you look at Northern Ireland, it is about £12 million. Southern Ireland is about £17 million. Then Denmark is about £65 million. It has gone up—it is probably about £70 million by now. We are at the very bottom. The problem is that the money just goes into production and development. We were delighted to see that the exhibition received some money from the regular funding a couple of weeks ago, but it is completely dependent on the supply of production. Otherwise, the exhibitors will just be exploiting international films. We need to be working on our own products. I know in general that there is much more activity in film production in Ireland and Northern Ireland because of the level of their investment. It is just a general assumption that, if we invest more, we get that level of activity here. Are there any specific examples that you can think of? We could have a Game of Thrones. We could have had Paul McGuigan's Frankenstein here. Everybody has a look at Scotland, but we have no studio. There is no incentive fund apart from the UK tax credit, so they go where the incentives are. We could have had a lot more economic impact if we made that investment. It is just shocking the amount that we have lost out on, but it is not the end of the world if we get our act together quickly, then we can participate. There seems to be an emerging theme that has come out of the discussion and it is about the kind of disconnect between the creative industry and the conventional mindset of business and perhaps a further one between public sector agencies who are tasked to facilitate or assist creative industries. I just wonder if, in attempting to bridge these gaps, we are perhaps not being creative enough in terms of our business models or business structures. I was interested in what Gillian said about a co-operative approach, and it strikes me that that might be the right model, but it might not. There might be other models that we could look at, but I can imagine the scenario where we have 50 creative people, an accountant and a couple of lawyers within a business entity. I wondered how much scope there is for taking things forward, in that kind of sense, rather than attempting to train every creative person so that he is a part-time accountant as well. I think that it could be very easily done. We did some analysis on the Danish film industry and bigger production companies around the world and their infrastructure. We looked at factual drama, animation and some games companies. We tried to define exactly what their infrastructure looked like, and then we asked all of our members what they specifically needed and matched the two. We tried to create a super infrastructure that put in place in the centre of the industry and could give everybody a shared access, but could very quickly transform. I think that the model needs some development, but if we thought creatively about it, there could be a catch-all mechanism for the creative industry. If we need to be creative about our business models, can that be applicable to other sectors, the craft sector, for instance? I thought Fiona. I am trying to imagine the young Picasso talking to Business Gateway, Scottish Enterprise, Creative Scotland instead of talking to Gertrude Stine and a fear that we might have lost a great artist in the process. Are there clever creative business models that we can apply that can move the craft sector on? I am not so sure about business models, but you are right about the training and who they speak to. I think that Gerdrude Stine has mentioned mentoring earlier. Some makers have tried to go through Business Gateway training. There is the cultural enterprise office, but they do not always speak the language. They do not always understand the challenges of the individual sector. To address one of the things that we have been doing recently, we have been working with the Crafts Council in England to have some very good schemes aimed at emerging makers, a scheme called Hot House, which is for people who are one to three years out of college and another one called Injection, which is for more established makers who want to start up and then develop their business. That is run by people who, using makers who have already established their business, have decided where they want to go. We could not run it ourselves. We do not have the economy of scale to do that. That has started this year and I hope that that will roll out and become more successful because it is more tailored for makers. That is the final question for the makers. I have saved the most important one for last. I am sure that you are all aware of the Smith commission. I am sure that you are all aware of the fact that the Scottish Government, fairly soon, we hope, will have some tax-raising powers or perhaps a lot of tax-raising powers. In terms of how we use those powers, can you see opportunities where we can creatively assist the creative industry? If there was an ability to increase the tax credit in Scotland for incoming production and for indigenous production, that would have a phenomenal effect immediately. Thank you very much for the impeccable timing that brings us to the end of our session. I speak for all members when I say that it has been absolutely fascinating. I really sense that we have only skimmed the surface of the topic. There are a lot more issues that we could follow up on on what the committee will have to do with the evidence that we have heard today and consider how we might take some of that forward in the future. In the meantime, I am very grateful to you all for the time that you have given in coming along today and presenting your evidence. We will now have a short suspension. OK, we have it here. Right. If we can reconvene item 3 on our agenda, we have two draft instruments to consider. We have the land register of Scotland, automated registration, et cetera, regulations 2014 in draft, and the land registration, et cetera, Scotland Act 2012, amendment and transitional order 2014 in draft. I would like to welcome, this morning, Fergus Ewing, Minister for Energy, Enterprise and Tourism, who is joined by Hugh Welsh, Head of Data at Registers of Scotland, Grant Hall, Head of 2012 Act of Implementation at Registers of Scotland and Kirsten Simony LeFevre, Solicitor at Registers of Scotland. Welcome to you all. Minister, do you want to introduce those instruments? Thank you, convener. Good morning to everyone. I am pleased to have been invited by the committee to speak to these two instruments. They are the final part of a suite of subordinate legislation that needs to be enforced for the designated day for the Land Registration, ETC Scotland Act 2012, and that is 8 December this year. On that day, the new scheme of land registration provided for in the 2012 act will come into force. That will bring into effect a fairer and more efficient system of land registration for the people of Scotland and will provide the technical tools necessary to enable completion of the land register. The instruments that the committee is considering today, which I think are narrow in scope, convener, will provide further practical details on what requires to be in place to ensure the smooth introduction of that new scheme of land registration. Registers of Scotland has been operating a computer system to register electronic deeds in the Land Register of Scotland since 2008. The system is called automated registration of title to land and is commonly known as ARTO. Over 90,000 deeds have been registered using that system. It allows solicitors, institutional lenders and local authorities to register electronically certain deeds that affect land registered titles. ARTO applications attract an abated fee, reflecting the lower cost of processing such applications, and this has saved those transacting with property in Scotland in the region of £11 million in registration fees since introduced in 2008. ARTO has its legislative basis in certain amendments to the Land Registration Scotland Act 1979 and the requirements of writing Scotland Act 1995. Those amendments are repealed by the Land Registration Scotland Act 2012 on the designated day, but the 212 Act contains specific powers to enable automated registration to continue from that date. Those powers are being used in the regulations under discussion today to maintain a continuing legislative basis for ARTO. Registers of Scotland intend to continue to operate ARTO from the designated day 8 December, and those regulations do not change any of the policies that underpin the system. The ARTO system has been modified to reflect the new scheme of land registration provided for by the 212 Act. The regulations under discussion restate current policy and practice to ensure that ARTO remains a secure system for electronic registration of deeds. This includes regulation 4, which sets out the duties on authorized persons using ARTO, including the requirement for an identity verification meeting between registers of Scotland and the person representing the organisation before they can start using ARTO. Regulation 9 amends the electronic documents Scotland regulations, which, among other things, introduces the new regulation 6, which makes continued provision to make it competent to register electronic documents in the Land Register of Scotland, provided that such a document meets certain technical requirements. It states that the electronic signature applied to such a document must be supplied by the keeper and certified by the keeper's public key infrastructure. Once embedded in a digital deed, the digital signature provides proof that the document has not been altered since it was signed, who it was signed by and when it was signed. That ensures the security of the system. It is important to make it clear that this SSI does not generally allow registration of electronic documents. The fees for ARTO have been set separately by the Registries of Scotland fees order 214, which has previously been considered by the committee. I am delighted to say that the fees were maintained at their current levels. In August this year, I announced that the statutory registration fees charged by Registries of Scotland will be frozen until at least April 2017, maintaining registration fees at the same level since 2011. The Land Registration Scotland Act 2012 amendment and transitional order 2014 is mainly technical in nature and provides amendments to the 2012 act in addition to some consequential amendments to other legislation. As those amendments are technical, I would not propose to go through the details of those amendments in this statement, but in conclusion, convener, I will be happy together with the assistance of my officials, I suspect, to take any question that the committee has on this order. Do any members have any points? I want to make a question, so I want to ask in relation to those instruments. Just very briefly, minister, with regard to the fees that you mentioned that they are frozen to April 2017, were you lobbied in respect of keeping the fees, or is this something that you decided that it was good for the registration and obviously good in terms of—it was an incentive to move forward in this respect? We are aware of general desire among the property sector domestic and commercial of the need to be competitive, the need to maintain costs as realistic and low a level as possible. Therefore, we took those general views into account. As a Government, we are also keen to make sure that the property transactions in Scotland as well as being registered in a professional and effective and swift fashion by the keeper whose performance has massively increased since I left practice, I am sure that is a coincidence. The financial burden of the costs should be kept to a minimum and that there should be certainty to the fees. I was pleased that we were able to confirm fees at the current levels—2011 levels—until 2017. That decision was one that was taken after a very careful consideration, convener of quite complex considerations relating to levels of reserves and other matters, which we have discussed before, and with the full co-operation assistance and agreement of the keeper. I would like to ask the committee just to recollect for a minute that it was this committee that did the scrutiny on the land registration act that the minister referred to, and we were broadly supportive of the aims and intent purpose of that act. We welcomed it, and I would wish to place on record my welcome for these final two statutory instruments that will complete the process of facilitating, convening in Scotland and making the whole system fit for purpose in the 21st century. I do not think that any other members wish to speak. Good morning. It is very briefly. As I recall, we had lengthy discussions around the computer system. I see that regulation 3 provides for the persons authorised to use what I understand to be a new system. Is that the case? Perhaps, Mr Welsh? No, it is still the same system. It is really in state the same policy. There are a few minor tweaks to it. The main difference is that there are less questions that are basically in line with the LR Act 2012, so it is already the same system. If nobody has a question, I just wanted to observe that the Delicated Powers and Law Reform Committee have indicated to us that they are content with the wording of both of these instruments, and we have also not received any representation from any external bodies in relation to those. That being the case, we can move on to item 4 on the agenda. I invite the minister if he would to move motions S4M11510 and S4M11511. Any members wish to speak in relation to these motions? No, in that case, we can just move to put the questions. The question is that motion S4M1150 be passed. This is in relation to the land registration of Scotland, automated registration and etc regulations 2014 in draft. Are we agreed? We are agreed. Thank you. The second is motion S4M11511 that we recommend that the land registration etc Scotland act 2012 amendment and traditional order 2014 in draft be approved. Are we agreed? We are agreed. Thank you minister and thank you to your officials. Yes, I need to ask the committee if they are content that the convener and clerk produced a short factual report of the committee's decisions and arranged to have that published. Thank you minister. It just falls to me to mention, as this may be your last visit to the committee, who knows in your current position to wish you success over the coming days. Well thank you very much, which I think is a very constructive note, so I will accept it in that spirit. It has been a pleasure of course. Thank you and for us of course. Thank you very much and with that we will suspend briefly and go into private session.