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Rishi Sunak
Rishi Sunak, Houses of Parliament in London Getty Images

How The UK Government’s $600M Film & TV Covid Restart Scheme Has Left Some Producers In The Lurch

EXCLUSIVE: When the British government launched its £500M ($601M) Film & TV Production Restart Scheme (PRS) in October 2020, independent producers breathed a sigh of relief. The scheme promised to kickstart film and TV production by offering cover for Covid-related costs that was necessary to getting the cameras rolling again.

Upon launch, then Chancellor of the Exchequer Rishi Sunak (who is now Prime Minister) was effusive in his praise of the targeted scheme, saying it would “help fill the gap created by the lack of available insurance and get our world renowned film and TV industry back up and running” – a gap that had been created due to private insurers refusing to provide for Covid-related issues.

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Producers would sign up to the scheme prior to entering production and, if any such issue marred their productions and led to additional costs, they would be able to submit a claim for reimbursement. Multiple senior government ministers and industry figureheads have extolled the virtues of the scheme over the past couple of years including, as recently as last week, BBC Chair Richard Sharp, who advised on its formation during his time in the government’s Downing Street offices.

However, months after the scheme’s official September closing date, a Deadline investigation has uncovered that not only has this mandatory scheme (which added an additional cost to production budgets) failed to pay out to many protocol-abiding producers – causing serious financial damage to numerous businesses – but the government-backed project is currently sitting on a cash surplus of around £11.5M ($14M).

At last count, the PRS, which was backed by the BFI and TV trade body Pact and was extended three times, claims to have registered 1,259 productions, across £3BN ($3.6BN) worth of production budget and 100,000 jobs, citing the likes of Peaky Blinders, Gentleman Jack, Saturday Night Takeaway, Good Luck To You, Leo Grande and Mothering Sunday as registered projects.

Many we have spoken with have been satisfied with the way in which it has been administered and have received claims promptly.

But according to the latest publicly available data from Marsh Commercial (the scheme’s administrator), the PRS has paid out just over half of the £54.2M ($65.9M) worth of 452 claims it has received, around £28.1M ($34.2M). Another £16.7M ($20.3M) worth of claims are still being processed, which accounts for 16%, or roughly 70, of the total claims, and £2.8M ($3.4M) have been rejected entirely. In this same data, there is some £6.6M ($8M) of claim monies unaccounted for, which the UK government’s Digital, Culture, Media and Sport (DCMS) department failed to explain to Deadline in time for publication.

At the same time, producers have paid around £39.6M ($48.1M) of premiums (1% of a project’s budget until October 31, 2021 – upped to 2.5% afterwards), meaning that the government is currently running a cash surplus of approximately £11.5M ($14M) from a compulsory scheme that projects had to buy into in order to keep the cameras rolling. A DCMS spokesman said it is “categorically untrue that the government has profited from the scheme.”

For many producers, some of whom Deadline learned had to sacrifice their entire production fees on projects when the scheme refused to pay out for Covid-related claims, it’s a bitter pill to swallow.

These mostly film producers described an arduous and over-complicated claims process, with several believing the people working on the scheme had little understanding of how a film or television set operated and how different teams worked together. One contacted the financial ombudsman, which ultimately couldn’t make a decision and advised him to complain to his local MP.

“Screaming into a vacuum”

“I feel like I’ve been screaming into a vacuum for six months,” says that producer, who has spent several months trying to get a claim processed after having another claim rejected by the scheme on a previous project. “Usually with insurance companies you’re dealing with a broker, who is an intermediary between you and the insurance company. With this, there was no third voice in the room.”

The producer adds, “With our claim I can’t get a hold of anyone logical to look at our case. I keep getting a different person responding to my ‘keyboard warrior’ emails that states that we did the right thing, and then a random question will pop back. They want us to give up, which is what a lot of people are doing.”

Multiple issues have arisen at claim stage since the scheme officially closed for submissions in September, we have been told, and insiders who are working on the scheme say processes are moving at a snail’s pace.

“It doesn’t feel like the government is trying to help,” says another source. “It’s like they put [PRS] in place to satisfy the financials so you can start making your film but I’ve spoken to loads of people who are waiting to process claims and feel like [PRS] is just waiting for them to go away.”

One prominent British independent producer tells Deadline her production company was “led to believe that we could go into production and we’d be supported by the PRS scheme, but the scheme just said ‘No, we’re not interested’.”

The longstanding producer, who has worked across a raft of top film and TV projects for the independent sector and studio system across the last three decades, had two vulnerable above-the-line members of staff and, at a personal cost to the production, shut down for a day and opted to pay for a mobile testing unit, something this producer says shrunk their claim to a quarter of the cost.

“We did everything we were supposed to do before we shut down,” adds the producer. “We took medical advice, we followed the protocols and used government approved entities but that still wasn’t enough. I worked so hard to minimize their risk, but they weren’t interested. There was no conversation to be had.”

The producer adds, “It’s not like any of us didn’t know what we were doing – we were advised to shut down, we’ve put in the claim and they came back and said we were unsuccessful.”

After disputing the issue for nearly six months, the scheme said no, which had a grave impact on post-production and ultimately cost the producers their fees.

“I have made an [insurance] claim in pretty much every job I’ve done for various reasons and this is the only time that I’ve ever been unsuccessful on a claim,” says the producer.

Describing the PRS as a “somewhat crude tool”, one financier tells Deadline that he was amazed at “how quickly the scheme got going and paid out claims at the beginning.”

In his mind, teething problems were always inevitable, and when queried over whether this scheme – which has increased costs for productions in a sector that was already on the backfoot thanks to the pandemic – should be in cash surplus when some indie producers lost entire fees and put their businesses in jeopardy, he tells Deadline, “That is absolutely not what should happen and anybody who had a justifiable claim should get paid.”

Inside the PRS machine

Insiders working on the scheme back up the remarks made by the disgruntled producers we have spoken with.

One puts the issue down to the scheme being “written up by lawyers along insurance lines but from the ground up with new rules and regulations,” which has partly contributed to the huge backlog as “interpreting this has been quite a process.”

Another source working on it says they feel the system has “effectively been wound down” since closing for applications in September, which has “made things difficult” given the sheer number of claims and their complexity. Additionally, a number of people working on the scheme from 2020 to mid 2022 were seconded from private insurance companies and have since returned to their old posts, while dozens of claims remain open.

A steering board that meets to examine difficult-to-interpret claims is now only assembling once per month and, if the board cannot make up its mind over a certain claim or has queries, these are passed back to lawyers, which slows the process even further.

Given high-profile press reports of people fraudulently accessing UK government-administered Covid schemes, one insider told us the nature of the scheme being backed by the taxpayer has led to the PRS “scrutinizing claims to the ‘nth’ degree.”

“Where [private insurers] would pay out, the scheme hasn’t,” says a different insider. “The government is very wary of fraud. They are not pointing a finger at the film and TV industry but rather every penny is being scrutinized and recalculated and claims are therefore taking days, weeks or months to audit.”

Furthermore, where private insurers would sometimes agree to pay out small amounts while a claim is being processed, the government is refusing unless in exceptional cases.

“They are saying it’s not their duty to bankroll the film and TV industry,” adds one of the insiders.

A DCMS spokesperson tells Deadline the department is committed to settling outstanding claims “as quickly as possible while managing public money responsibly and ensuring value for money for the UK taxpayer,” adding that it has “helped our world-class film and TV industries survive the pandemic.”

Deadline understands the scheme’s operators are hoping all claims can be resolved by early-to-mid 2023 but producers remain pessimistic.

“This is unethical,” says one we spoke with.

“They are expecting people to be too busy to chase and they are hoping that they won’t have to pay out. This is not the way any sort of business, let alone a government-backed scheme, should be run.”

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