Ireland has the “most transformative” tax and benefit system for increasing disposable income for screen sector freelancers, according to a report led by the British Screen Forum and Film and TV Charity.
Make Freelancing Pay aimed to examine how the UK government’s tax and benefits system could be better used to prevent churn in screen industries’ freelancer workforce, with backing from the BFI, Bectu, Equity, Directors UK and the Production Guild of Great Britain.
The report modelled how Ireland, Germany, France, South Korea, Spain and Sweden’s more favourable tax and benefits systems could, if implemented in the UK, have a positive impact on freelancer’s disposable incomes and enable a more diverse workforce to stay in the film and TV industries.
In Ireland, a pilot basic income for the arts scheme was implemented from 2022-25, and has now been extended. Workers over the age of 18 in artistic fields can apply to receive a set payment of €325 per week, and treated similarly to other forms of taxable income.
A similarly implemented scheme in the UK could mean an increase in disposable income upwards of 40% for all freelancers except high earners (£75,000 per year), with the latter still seeing their income increased by nearly 20%,
Under the Sweden-inspired minimum hourly wage policy, the disposable income for a low earner (£11,000 per year) increased at a rate more than 10 times that of a high earner. Sweden sets a minimum hourly wage for artistic work. As of June 2024, that stood at £14.84 (SEK 202.20). To model a Sweden-style minimum system, the report instituted a minimum wage of £21.65 in the UK, where the current minimum wage is £11.44 for over-21s.
The least progressive policies were those modelled on France and Germany. France’s ‘intermittent du spectacle’ scheme allows intermittent workers who work at least 910 hours over a period of 24 months qualify for unemployment support for 12 months following their last working day. The unemployment insurance payment they receive equals the salary for five hours worked at national minimum wage per day. When modelled in the UK, disabled and younger freelancers see fewer improvements than freelancers with average earnings both in the UK generally and outside of London.
The Germany-style policy hitches impact to national insurance contributions, so high-earning freelancers (who would pay higher national insurance contributes) benefit the most and low earning freelancers benefit the least. German employees have a contribution to social insurance deducted from their gross salary, alongside their taxes. German social insurance is co-funded by employee and employer.
Spain’s additional unemployment benefit and South Korea’s system of 30-50% of national pension contributions and public rental housing schemes for artists delivered marginally improved outcomes when modelled for UK freelancers.
The Swedish and German policies would increase employer costs, while the rest are government-funded approaches.
The research was undertaken by Doris Ruth Eikhof at the University of Glasgow and Hannah Randolph at the Fraser of Allander Institute, University of Strathclyde.
UK freelancer crisis
In the past five years, the largely freelance UK screen sector workforce – around 70% in film and TV production – has undergone a series of challenges, from the pandemic to the US strikes and a downturn in commissioning. The report identifies that tax and benefits systems “cut across productions, companies and contracts” and therefore allows for a unified intervention to help the workforce en masse.
“How well freelancers are able to make a living not only depends on the fees and contracts they are able to negotiate. How the government decides to support the context of a freelancers’ work – their ability to pay for childcare, for instance, or to save up for paying future tax bills without already losing too much tax on the savings crucially impacts on who is able to make a living from screen work and who isn’t,” says the report of its use of disposable income as a comparable measurement across the different national systems.
Under the UK tax and benefits system the annual disposable household income for the different categories of screen freelancers modelled, except the highest-earner, reaches only around 80% of what individuals with comparable qualification levels achieve in the UK economy generally. For freelancers in low paying screen roles and disabled freelancers this figure goes down to 70% and 75%, respectively.
The categories of freelancers modelled ranges from annual earnings of £11,000 to £75,000, with and without children, across age groups and takes into account disability.
“The last five years have seen a series of external shocks – the pandemic, the US strikes – and a downturn in commissioning that have led many freelancers to consider their future in the screen sector, with some walking away entirely and building new careers in different industries,” said Pete Johnson chief executive British Screen Forum.
“The pressure of income insecurity has inevitably been felt most acutely by those with the least to fall back on, exacerbating existing issues relating to the under-representation of certain groups of people – including disabled people, people from minoritised ethnic communities and people from working-class backgrounds.”
An estimated 36-47% of the UK workforce are on non-permanent contracts, according to the report. In film and TV production, this figure rises to more than 70%. Among the respondents in a Film and TV Charity survey, who predominantly worked in film and TV production, only 24% reported having a permanent employment contract.
The report noted: “The results are not a call for the UK to ‘be more Sweden’ or ‘go South Korean’. Tax and benefits policies have country-specific contexts that render such simplistic slogans nonsensical. But as our findings show it does make sense to ask, ‘If this is possible elsewhere, what might be possible in the UK?’”
Make Freelancing Pay: Can we use taxes and benefits to boost competitiveness, and improve workforce diversity and retention in the UK screen sector? was initiated by a coalition of screen sector stakeholders, led by British Screen Forum and the Film and TV Charity, and supported with funding and advisory input by Creative Industries Policy and Evidence Centre, BFI, Bectu, Equity, Directors UK and the Production Guild of Great Britain. It was published by Design Otherwise, a University of Glasgow spin-out company.
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