UK Labour party leadership candidate Ed Balls called out UK game industry tax break opponents on Friday, saying in a blog post that the government should "rethink axed support for video games industry."
His comments come days after Dundee, Scotland-based APB and Crackdown developer Realtime Worlds went into administration, costing hundreds of area jobs.
"The Tory-Lib Dem government is putting the future of the computer games industry in Scotland at risk," said Balls. "The terrible news this week about Realtime Worlds could be just the start unless the coalition government rethinks its decisions which are costing jobs and risking the recovery."
Balls directly blamed the lack of tax breaks for Realtime Worlds' current financial peril. "While Labour set out plans to support the industry in March, the new government axed it in June and the result is job losses in Dundee in August."
He added, "These are the stark consequences of a government which cuts at any cost and seems to think that unemployment is a price worth paying."
Realtime was a well-funded operation and employed over 300 workers across locations in Dundee and Boulder, CO in the U.S. The company released Crackdown on Xbox 360 in 2007 and earlier this year, the expensive cops and crooks online action game APB, which was a commercial failure. Realtime's administrators are currently trying to keep the game running.
Balls said, "It is economic madness to be cutting support for industry and high-skilled jobs at this time. That’s why I am calling on the Tory-Lib Dem government to urgently rethink this decision."
"While Labour set out plans to support the industry in March, the new government axed it in June and the result is job losses in Dundee in August."
And how long was your party in power for, exactly? Oh yeah, that's right, thirteen years.
Thirteen years to support the industry, and they chose to do nothing until just before the election, when they were desperate. They're still desperate, and this smacks of an opportunistic attack and an attempt at FUD. (Yes, obviously, I would be extremely happy to see tax breaks for the games industry; I just hate this kind of shit-stirring.)
Additionally: there have been a number of reasons suggested for RTW going under – at least some from a couple of supposed ex-producers at the studio – and this is the first time I've heard the lack of tax breaks being responsible.
RTW failed because it spent a fortune making a bad game, not because it didn't get tax credits. Is he really suggesting that tax payers money should go towards subsidising a failed company that makes products that nobody wants to buy? That approach was tried in the 70's with the car industry and now there are no British owned mass car manufacturers left in the UK.
The real problem facing the industry is the poor quality of graduates. Who was responsible for education under Labour? Step forward the one and only Mr. Ed Balls. If Ed Balls says we need something then it is a sure sign that we don't.
The games industry became important to government the moment it started lobbying. It's the way things are done.
Now I think about it, lobbying is to governments what advertising is to impressionable kids. It puts an industry or company into the minds of people who are otherwise so insulated from the world they would never know about it. They don't go out looking for information much (except maybe on research trips to warmer climates :P), it's much easier to sit back and listen to the loudest voice coming in. Of course, as the quality of a company's commercials bears little resemblance to the quality of its products, it's the same with lobbying; the UK's great dev talent is just finding its voice in TIGA, but it's still drowned out by the big guns of the City and inward investment.
I agree with Ed that Britain (heck, EVERY nation) should be more competitive in attracting business in a market as large as video gaming, and I agree giving tax breaks will be a step in the right direction in creating a more attractive environment for game developers.
However.
I must VERY highly disagree with Ed that Real Time Worlds would have been saved by such a tax break. Very poor product sales is what did them in. I can name several instances where "lower taxes" created business. But I cannot name one instance where "too much taxes" murdered a development house in the video game industry like RTW.
So regarding Ed Balls' statement, I support the sentiment and the motion to give incentives to the video game industry as they are substantial contributors to the economy. But I do not support his reasoning, or using RTW as an example.
Balls is running for the Labour leadership and this is just more spin to convince people that he knows how to work with business (a failing for Labour). The fact that he was Gordon Brown's right hand man in the treasury when Brown was chancellor and sytematically destroyed the wealth of our nation and put our grandchildren in debt should not be forgotten.
Whilst I also find it jarring to see lack of tax breaks blamed for RTW's demise, we have to remember that it's just FINE for people to think that. Would they have made any meaningful difference to Realtime? No. Will they make a difference to every other company still active in the UK games industry? Absolutely.
We still need those tax breaks, and if people think missing out on them has just driven a major employer out of business, so much the better.
"While Labour set out plans to support the industry in March, the new government axed it in June and the result is job losses in Dundee in August."
And how long was your party in power for, exactly? Oh yeah, that's right, thirteen years.
Thirteen years to support the industry, and they chose to do nothing until just before the election, when they were desperate. They're still desperate, and this smacks of an opportunistic attack and an attempt at FUD. (Yes, obviously, I would be extremely happy to see tax breaks for the games industry; I just hate this kind of shit-stirring.)
Additionally: there have been a number of reasons suggested for RTW going under – at least some from a couple of supposed ex-producers at the studio – and this is the first time I've heard the lack of tax breaks being responsible.
The real problem facing the industry is the poor quality of graduates. Who was responsible for education under Labour? Step forward the one and only Mr. Ed Balls. If Ed Balls says we need something then it is a sure sign that we don't.
Now I think about it, lobbying is to governments what advertising is to impressionable kids. It puts an industry or company into the minds of people who are otherwise so insulated from the world they would never know about it. They don't go out looking for information much (except maybe on research trips to warmer climates :P), it's much easier to sit back and listen to the loudest voice coming in. Of course, as the quality of a company's commercials bears little resemblance to the quality of its products, it's the same with lobbying; the UK's great dev talent is just finding its voice in TIGA, but it's still drowned out by the big guns of the City and inward investment.
However.
I must VERY highly disagree with Ed that Real Time Worlds would have been saved by such a tax break. Very poor product sales is what did them in. I can name several instances where "lower taxes" created business. But I cannot name one instance where "too much taxes" murdered a development house in the video game industry like RTW.
So regarding Ed Balls' statement, I support the sentiment and the motion to give incentives to the video game industry as they are substantial contributors to the economy. But I do not support his reasoning, or using RTW as an example.
We still need those tax breaks, and if people think missing out on them has just driven a major employer out of business, so much the better.