This week, Prime Minister Theresa May delivered her much-anticipated Brexit speech, which, seven months after the referendum result, finally provided some clarity on what ‘Brexit means Brexit’ truly means.
In those months, Ukie has been consulting intensively with the sector through our working groups and via surveys, and feeding those results directly to government, and ensuring the concerns of interactive entertainment are heard in papers submitted to government. It is a critical time to make sure we are front and centre of a future proof Industrial Strategy.
We’re now embarking on a huge evidence gathering drive by launching a new industry-wide Brexit consultation and undertaking a 10-stop Brexit roundtable tour across the country – to hear directly from you about your key concerns and what principles a new immigration system should be built around. We want to be sure that we’re putting across the industry’s accurate views, ideas and concerns to government and ensure you help shape our policies.
Only by uniting in voice and through evidence will we make the strongest case to government to build the best conditions possible in a post-EU UK.
This nationwide intelligence gathering will inform the asks around the key issues of access to talent, access to markets, free flow data and the funding reforms brought about by exiting the EU ahead of government’s negotiations.
What does Brexit mean?
The clarity provided by the Prime Minister this week will not be to everyone’s liking and is far from providing us with certainty as to what the final version of our future relationship with the EU will resemble once it has been approved by our 27 European neighbours.
So what have we learned about the type of deal we’ll be seeking and the impact it could have on UK games businesses?
Access to talent
People make and sell games, not bots. Since the run-up to the referendum it’s been clear that ensuring that games businesses continue to have access to the people they need to grow and thrive is our number one concern. These skills bleed extensively into other innovation and creative sectors and are vital for our future competitive economy. 70% of companies we surveyed said access to talent is “critically” important to the industry and that the most detrimental aspect of Brexit would be new difficulties in sourcing high-skilled EU people who bring with them experience, specific skills and perspectives.
Following May’s speech, this remains our number one concern. She did not say much to reassure and counteract the rhetoric we’ve heard. Whilst she did say she wants to guarantee the right of EU nationals in Britain and that the UK will always want high-skilled immigration, she remains wedded to net immigration targets and vowed to control “the number of people coming to Britain from the EU.”
While we wait for the Home Office to give an indication of the kind of immigration system that might work for EU citizens, it is crucial that we present the data and evidence to prove to policy makers that the future of our industry and others depends on maintaining this flow of diverse, top global talent entering the industry. We also have to remind them not to get distracted away from investing in our own homegrown talent too.
Access to markets
It is now clear that the UK will no longer be part of the single market as the government will commit to prioritising controls on EU immigration and withdrawing from the jurisdiction of the European court of justice – two aims incompatible with single market membership. May said she will instead be seeking an extensive, ambitious, and bespoke free trade agreement with the greatest possible access to the single market.
We also know that full membership of the customs union is looking unlikely as it would prevent us from negotiating comprehensive agreements with our new trading partners. In a customs union, members agree to charge the same import duties as each other and usually allow free trade between themselves. Instead, we will be looking for some form of agreement, whether part or independent of the customs union, with the EU and for the UK to have tariff-free access to EU markets.
Since the outcome of the referendum, we have been calling on government to protect the ease of trade that games businesses currently enjoy because of our EU membership. As an industry that still has a sizeable market in selling physical products – including new VR headsets and consoles – it’s important to ensure that UK-EU trade in physical games products is kept tariff-free.
At Ukie we have been taking crash courses in understanding the shape of other international trade deals and what they look like in a digital economy – because we are also a sector that largely relies on the free flow of data across borders. We can safely say that trading with the EU on WTO rules would still provide us with the ability to have tariff free trade on key games products, such as consoles and boxed games, thanks to the recent extension of the Information Technology Agreement.
We’ve also been asked to consider what non-tariff barriers to trade look like in a digital world where a publisher or developer can export their game to millions of consumers around the world at the press of a button. And whilst it’s less clear to what extent our industry should be concerned with traditional trade barriers, one thing that has become evident from speaking with our members is how crucial maintaining the free flow of data between the UK and EU will be going forward.
The interaction and associated data flows between players, games and platforms is intrinsic to our creative business and the possibility of these data flows being impeded are unimaginable. That’s why we’ve been calling on government to ensure the free movement of data continues following our exit from the EU by obtaining a declaration that we have acceptable safeguards in place for data protection.
Building a Global Britain that works for the games industry
We must remember that Brexit is only one side of the equation, and we remain committed to ensuring that the UK is the best place in the world to make and sell games, and to capitalise on the opportunities that will emerge as we begin our departure from the EU.
The recommendations we put forward in our Blueprint for Growth report ring as true today as they did in 2015, and chime well with the Prime Minister’s new Industrial Strategy for a “truly global” post-referendum Britain. But we are refreshing that with a Brexit lens. We are working closely with government to ensure that games and creative industries are central to the forthcoming Industrial Strategy which must be future proof for a digital economy.
Remember: the UK is ranked third best country in the world for the ability to attract, retain, train and educate skilled workers, and we are well-equipped to deal with changes and opportunities brought by technology and innovation. This is our lifeblood. We also attracted more tech investment than that of any other European country in 2016. We want to keep it that way.
Please take part in the consultation
So please take 10 minutes to fill in the Consultation or become part of the dialogue by attending your nearest Ukie Brexit Roundtable, which we are hosting across the UK throughout January and February.