How UK Government’s $600M Film & TV Covid Restart Scheme Put Some Producers Out To Lunch

Exclusive: When the British government launched its £500M ($601M) Film and TV Production Restart Scheme (PRS) in October 2020, independent producers breathed a sigh of relief. The scheme promised to kick-start film and TV production by offering cover for Covid-related expenses that were needed to get the cameras rolling again.

After the launch, then-Chancellor of the Exchequer Rishi Sunak (who is now Prime Minister) praised the targeted scheme, saying it would “fill the gap created by the lack of insurance available and help us get our world-renowned film and TV industry back up and running” – a gap which It was created because private insurers refused to pay for Covid-related problems.

Producers will sign up to the scheme before going into production and, if any such problem damages their production and leads to additional costs, they will be able to submit a claim for reimbursement. Several senior government ministers and industry figures have praised the scheme’s merits over the past few years, including last week, BBC chair Richard Sharpe, who advised on its creation during his time in the government’s Downing Street office.

However, months after the scheme’s official September deadline, a deadline investigation revealed that not only was the mandatory scheme (which added an additional cost to the production budget) failed to pay many protocol-compliant producers – resulting in serious financial losses for many businesses. – but the government-backed project is currently sitting on a cash surplus of around £12.3M ($15M).

At last count, the PRS, which was backed by the BFI and TV trade body Pact and expanded three times, claimed to have registered 1,259 productions with a production budget worth £3BN ($3.6BN) and 100,000 jobs. Peaky Blinders, Gentleman Jack, Saturday night takeaway, Good luck to you, Leo Grande And Mothering Sunday As a registered project.

People we spoke to were satisfied with the way it was handled and received claims promptly.

But according to the latest publicly available data from Marsh Commercial (the scheme’s administrator), PRS paid out more than half of the £54.2M ($65.9M) worth of 452 claims, around £28.1M ($34.2M). A further 16.7M ($20.3M) worth of claims are still being processed, which is 16% of total claims, or around 70, and £2.8M ($3.4M) have been rejected outright. In this same data, around £6.6M ($8M) of claims are unaccounted for, which DCMS failed to explain by publication deadline.

At the same time, producers paid about £39.6M ($48.1M) in premiums (1% of a project’s budget until October 31, 2021 – rising to 2.5% later), meaning the government is currently running a cash surplus of around £11.5 million from a mandatory scheme. M ($14M) that projects had to buy to keep the cameras running A DCMS spokesperson said it is patently untrue that the government has benefited from the scheme.

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

Most of these film producers described a difficult and over-complicated claims process, with many believing that the people working on the scheme had little understanding of how a film or television set operates and how different teams work together. Contacted a financial ombudsman, who was ultimately undecided and advised him to complain to his local MP.

“Shout into the Void”

“I think I’ve been screaming into the void for six months,” said the producer, who spent several months trying to process a claim after being rejected by the scheme on a previous project. “Usually with insurance companies you are dealing with a broker, who is the intermediary between you and the insurance company. There was no third sound in the room with it.

The producer added, “With our claims I can’t get hold of anyone reasonable to look at our case. I keep getting a different person responding to my ‘keyboard warrior’ emails saying we did the right thing, And then a random question will pop back. They want us to give up, which many people are doing.”

There have been multiple issues at the claims stage since the scheme officially closed for submissions in September, we’re told, and insiders working on the scheme say processes are moving at a snail’s pace.

“It doesn’t seem like the government is trying to help,” said another source “It’s like they do [PRS] In place of financial satisfaction so you can start making your film, I’ve spoken to many people who are waiting for claims to be processed and it seems [PRS] Just waiting for them to leave.”

A prominent British independent producer told Deadline that his production company “was led to believe that we could go into production and that we would be supported by the PRS scheme, but the scheme just said ‘no, we’re not interested’.”

The longtime producer, who has worked across a raft of top-notch film and TV projects for the independent sector and studio systems over the past three decades, had two lean staff and decided to pay for production at personal expense, a day off and a mobile testing unit. Taken, some of these producers say their claims have shrunk to a quarter of the cost.

“We did what we were supposed to do before we got shut down,” added the producer. “We took medical advice, we followed protocols and used government approved agencies but it was still not enough. I worked hard to reduce their risk, but they weren’t interested. There was no talking.”

The producer added, “It’s not like none of us knew what we were doing – we were advised to stop, we claimed and they came back and said we failed.”

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

“I made one [insurance] I’ve applied for almost every job I’ve done for various reasons and this is the only time I’ve ever failed to apply,” says the producer.

Describing the PRS as a “somewhat crude tool”, one financier told Deadline that he was “surprised at how quickly the scheme was rolled out and claims were initially paid.”

In his mind, the teething problem was always inevitable, and when questioned whether the scheme – which increased the cost of production in a sector already on the backfoot due to the pandemic – should be a cash surplus while some indie producers lost their entire fee. And putting their business at risk, he told Deadline, “this should not happen at all and whoever has a fair claim should be paid.”

Inside the PRS machine

Insiders working on the scheme back up the comments of disgruntled producers we spoke to.

One put the issue down to the scheme being “written by insurance line lawyers but from the ground up with new rules and regulations,” which contributed to the huge backlog in part because “it’s quite a process to explain.”

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

A steering board that meets to examine hard-to-explain claims now meets only once a month and, if the board can’t decide on a particular claim or has questions, it’s referred back to lawyers, which slows down the process. More

In the wake of high-profile press reports of fraudulent access to UK government-run Covid schemes, one insider told us that the taxpayer-backed nature of the scheme makes the PRS “verify the claims to a ‘no’ degree.”

“Where [private insurers] would pay, the scheme did not,” said a different insider. “The government is very cautious about fraud. They are not pointing fingers at the film and TV industry but every penny is being scrutinized and recalculated and it is taking days, weeks or months to audit the claims.”

Moreover, while private insurers sometimes agree to pay small amounts during the claims process, the government is refusing in exceptional cases.

“They say it’s not their responsibility to bankroll the film and TV industry,” added an insider.

A spokesperson for DCMS told Deadline that 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 is “sustaining our world-class film and TV industry. Helped to stay. Worldwide.”

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

“It’s unethical,” said one we spoke to.

“They’re hoping people will be too busy to chase and they’re hoping they don’t have to pay. This is how government-backed projects should be run, not any kind of business.”