TIGA, the trade association representing the video games industry, has submitted evidence to the Business, Energy and Industrial Strategy Committee’s inquiry on ‘The impact of coronavirus on businesses and workers’.

The evidence submission is based on feedback from games developers, publishers and service providers in the video games industry. In the response, TIGA welcomed the steps the Government had taken but called on it to introduce additional measures of support at this critical time.

In the consultation response, TIGA highlighted the main impacts of coronavirus on the industry, for example:

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  • Employment costs: In creative industries like the video games industry, the biggest business cost is employment. Many small games studios are not cash rich and/or depend on work for hire projects which are now drying up.
  • Contractors:5 per cent of the UK games development workforce are contractors. The self-employed and contractors need a safety net during the current crisis.
  • Impact on raising finance: UK studios struggle to raise finance in normal times. The current turmoil in the financial markets has exacerbated this problem and resulted in promised venture capitalist finance evaporating.
  • Rent payments: Given the necessary measures on social distancing, many businesses, including games firms, face wasting money on rent whilst having empty premises for the foreseeable
  • Remote working: As a digital industry, many video games firms have been able to switch to remote working relatively quickly. However, it is not an ideal working arrangement because game development is a highly collaborative process and some studios have been struggling with remote working because of slow broadband speeds.

TIGA has also made recommendations to the Government, such as:

  • The Government’s Job Retention Scheme: This is a welcome initiative that will enable games businesses to retain employees and avoid making redundancies. The Government should extend the scheme as necessary to last the length of the crisis. It should also consider NIC, VAT and PAYE holiday to provide businesses with more time and runway to stay in operation.
  • Video Games Tax Relief (VGTR) and R&D Tax Relief: VGTR is our industry’s most important Government tax measure. The Government should consider increasing the rate of VGTR and fast tracking claims for both VGTR and R&D Tax Relief.
  • Incentivising VCs to continue to invest in companies: The Government could examine ways to incentivise VCs to continue to invest in promising companies, to help tackle the issue that studios have in accessing capital.
  • More information: More information could be provided on rate freezes, loans and grants for businesses, and how games companies can access these schemes.
  • Relieving the cost of rent for businesses: The Government should consider ways of relieving the cost of rent for businesses while the emergency lasts. This would reduce business costs and avoid the danger that thousands of businesses will close rather than waste money on rent. The Government should also extend the business rates holiday to other sectors to relieve pressures for at least 6 months.

More information and advice on the COVID-19 outbreak and the video games industry can be found on TIGA’s dedicated COVID-19 page.


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