The UK’s high-end TV sector faces mounting financial challenges, and Jane Featherstone, co-founder of Sister (Chernobyl, Black Doves), believes the solution lies in aligning its tax incentives with those enjoyed by independent films.

Speaking at a UK parliamentary Culture, Media, and Sport (CMS) Committee inquiry, Featherstone highlighted the growing pressures on high-end TV production, citing skyrocketing costs and shifting funding models that have squeezed public service broadcasters (PSBs) like the BBC, ITV, Channel 4, and Channel 5 out of the market.

“Below-the-line costs have risen by 40%, and above-the-line costs have surged by 50-60%,” Featherstone explained, referencing the impact of Netflix’s UK arrival in 2013, the Covid pandemic, and the Hollywood strikes of 2023. “A greenlight from a PSB now covers just 30-40% of the budget, leaving a 60% gap that is nearly impossible to close.”

This gap has forced many high-end TV productions into a financing model closer to that of indie films, particularly for projects with budgets under £3 million per hour. Featherstone urged the government to extend the recently enhanced Independent Film Tax Credit (IFTC)—which provides a 40% rebate for films costing less than £15 million—to high-end TV.

Currently, TV productions qualify for the Audio-Visual Expenditure Credit (AVEC) at a rate of 25.5%, a figure Featherstone described as inadequate for the industry’s evolving needs. “The existing tax credit for TV is a blunt tool,” she said. “I’d add levers, including enhanced relief for PSB productions and additional uplifts for projects made in the nations and regions.”

Her call mirrors earlier testimony from Jane Tranter of Bad Wolf (His Dark Materials), who also emphasized the need for targeted tax incentives to keep British TV competitive.

Financing Challenges: A Tipping Point

The collapse of distribution advances has made financing TV projects even more precarious. Featherstone noted that British content is increasingly difficult to sell internationally, citing Mr. Bates vs. The Post Office as an example. Despite its domestic success, the ITV Studios and Little Gem production failed to gain traction abroad, ultimately losing around £1 million.

With US streamers like Netflix and Amazon now dominating the market, Featherstone acknowledged their financial muscle but expressed frustration over their rigid approach to rights ownership. While Sister has partnered with Netflix (Eric, Black Doves, Kaos) and Amazon (The Power), Featherstone said, “It’s hard to argue they’re fully flexible. Their business model requires them to own almost all of the rights, leaving little room for negotiation.”

This dynamic has shifted the role of producers in the UK. “We’ve effectively gone from a manufacturing industry to a service industry,” she said. “As a producer, I feel more like a hire-for-service professional than a creative entrepreneur.”