Richard Wilson is the CEO of TIGA. In his address below, he has outlined approaches for reforming the UK education system to help meet the needs of the industry.
TIGA has also thoroughly outlined detailed policy for development tax breaks, as part of the association’s newly-released manifesto on its future policy for the video games industry.
Training, Education and Skills
Introduce a pilot SME Training Tax Relief (TTR). This tax measure would operate in a similar way to the existing R&D tax credits. SMEs would be able to offset expenditure on training, Continuous Professional Development (CPD) for staff and education outreach activities against corporation tax.
Of the UK adult population, just 51 per cent and 31 per cent have either a level 3 or level 4 qualifications respectively. This is relatively low. A large proportion of the UK workforce also lacks good basic skills: 17 million adults have difficulties with numbers and 5 million are not functionally literate. The UK should strive for one of the best skilled and qualified workforces in the world. Enhanced skills can improve productivity which is good for business. Equally, higher skills can raise the employability of individuals.
UK public and private investment in training is comparatively low by international standards. Market failure can contribute to a failure to invest in skill development. Employers face the hurdles of cost and lost time when training their staff. This is particularly true for SMEs. Games businesses invest in training. 85 per cent of UK games developers provide some form of training to their employees. However, only 8 per cent provide training leading to a qualification.
The SME Training Tax Relief could be piloted in the video games sector and potentially other creative industries. Regional Development Agency funds that are currently devoted to video games could be used to pay for the pilot SME Training Tax Relief.
This measure would serve to encourage more workforce development and training by games businesses in particular and other SMEs in general. Other things being equal, staff productivity and employability would be improved. It could additionally lead to an increase in training resulting in qualifications.
It would also lead to stronger business-educational links. In the case of the games industry, more developers would have the incentive and resources to provide guest lecturers to universities, contribute to course development, participate in school, college and university career days and make work placements available. Knowledge exchange between industry and universities would be strengthened.
Maintain existing generous bursaries to trainee teachers in mathematics and science; provide more generous ‘golden hellos’ to teachers in these disciplines; and pay off their student loans if they go into teaching and stay in the profession for a specified number of years (perhaps five).
Test and examination results indicate that the quality of UK education remains comparatively disappointing. The United Kingdom is 14th in the PISA league table for Science, and 24th on the PISA league table for Mathematics. Over two-fifths of GCSE students failed to get a good pass (A* – C grades) at GCSE mathematics in 2009.
Part of the reason for this relatively poor performance relates to the supply of teachers. There is a shortage of mathematics and science teachers in schools. Only 40% of trainee teachers in mathematics and computing had good degrees (i.e. 2:1 or above) in 2007. Unless pupils and students are taught by good teachers, they will struggle with STEM subjects and be put off from studying them any longer than they have to.
Improving the financial incentives for graduates in mathematics and science to go into teaching should ease teacher shortages in these disciplines. This in turn should help to ensure better quality teaching in these disciplines in schools. Ultimately, this should lead to a greater supply of young people with a good understanding and higher examination results in mathematics and the sciences.
Promoting the games industry in schools
Promote the video games industry as a career option at school.
Highlighting the opportunities which exist in the video games industry could help to encourage pupils and young people to continue studying science, technology, engineering and mathematics subjects (STEM) on the one hand, and art, animation and design on the other. This is not simply important for the UK games industry. The UK as a country has a poor record in respect of post-16 education and training. The proportion of young people staying in education post 16 is below the OECD average.
Promoting the video games industry as a career option in schools could help to dispel the negative associations relating to some STEM subjects and encourage more pupils to persevere with studying them.
Increase expenditure on higher education
The UK spends approximately one per cent of Gross Domestic Product (GDP) on tertiary education. The aim should be to increase this over the course of the next Parliament. This should be funded in two ways: by maintaining in real terms public expenditure on tertiary education at 2009 levels and then increasing it as the Government’s deficit is brought under control; and by eliminating the cap on tuition fees.
UK higher education is a success story and a source of competitive advantage. According to the Shanghai University league table of universities, the UK has 4 universities in the top 30, second only to the USA. The UK has just one per cent of the world’s population yet achieves 12 per cent of the world’s scientific citations, while our humanities published 33 per cent of the world’s output between 2006 and 2008. The UK is also second only to the USA in the market for overseas students. The net annual contribution to the UK’s national income made by international non EU students in higher education is £5.5 billion.
Many of the UK’s competitors spend substantially more on higher education. Canada, South Korea and the USA spend between 2.5 per and 2.9 per cent of GDP on tertiary institutions. The UK spends approximately one per cent of GDP on tertiary education, of which approximately three quarters is from public sources. Unless the UK increases investment on tertiary education and spends it effectively, the UK’s competitive advantage in higher education will be eroded.
Higher education funding has not kept pace with the expansion in student numbers that has taken place. Funding per student has halved in the UK over the past 20 years. Funding in the UK ($11,866) is around half the US level of investment ($24,704) and substantially lower than Canada ($19,992) and Sweden ($16,073). The UK video games industry competes to a crucial extent on the quality of its workforce. If tertiary education is not adequately financed then the supply and quality of graduates will be adversely affected.
Increasing the proportion of GDP allocated to tertiary education will support the UK’s ambition to be a leading knowledge economy. More intelligent people will be able to benefit from higher education, the quality of research will be strengthened, the recruitment and retention of high quality teaching staff will be enhanced and the UK’s leading position in the market for overseas students will be reinforced. UK games businesses will also be more likely to draw on a healthy supply of high quality graduates if investment in tertiary education is increased.
Reduce tuition fees in priority undergraduate subjects
Reduce tuition fees for students studying mathematics and computer science degrees. This could be achieved either by universities voluntarily cutting tuition fees in these disciplines or by Government action to achieve this objective, either by regulation or by financial intervention.
The video games industry needs high quality graduates (or the vocational equivalent) in both STEM subjects such as computer science and mathematics, and art and animation. The games industry has experienced skill shortages particularly in computer programming. This has had a negative impact on many games businesses, for example, resulting in the delay of products and services and increasing the workload on other staff.
As Professor John Holman, National STEM Director and Director of the National Science Learning Centre has said: ‘The UK needs more STEM graduates if we are to be a leader in the knowledge economy.’ Indeed this problem has been reiterated by David Lammy MP, Minister of State for Innovation, Universities and Skills, who stated: ‘We need to encourage more people from all backgrounds to take up STEM subjects to expand and improve skills here in the UK’. The Leitch Review of Skills suggested in 2006 that the UK needs to increase the proportion of the workforce qualified to degree level or the vocational equivalent from 29 per cent in 2005 to 40 per cent in 2020. Yet the number of graduates in some STEM disciplines is in decline. The number of people taking Computer Science courses at University has fallen dramatically from 131,280 in the academic year 2004/05 to 95,575 in 2007/08.
Universities will have to avoid deterring potential students from studying STEM courses if tuition fees rise further, following Lord Browne of Madingley’s review of Higher Education Funding and Student Finance.
Some STEM courses are relatively expensive for universities to provide and clearly need to be properly resourced. Universities should consider cross subsidisation between different degree courses to ensure that potential STEM students are not discouraged from entering higher education. Money raised through higher tuition fees should also be used to provide for bursaries and lower fees generally for capable students from disadvantaged backgrounds to study STEM subjects.
Reducing tuition fees for mathematics and computer science degree courses and keeping them lower in comparison to other undergraduate subjects would provide a strong financial incentive to bright students to study these subjects. Other things being equal this should increase the supply of good quality graduates in these disciplines, easing skill shortages in the video games and other industries.
Encourage industrial secondments
Promote industrial secondments between universities and games businesses.
The knowledge transfer between universities and business is mutually beneficial. Games businesses have much to benefit from establishing strong links with educational institutions. For example, many UK games businesses could enhance their competitive edge and the quality of their games if they develop a greater understanding of current academic research in areas such as machine learning and artificial intelligence. Universities benefit from acquiring a greater understanding of the activities of businesses and their skill needs.
This scheme would benefit individual lecturers and their university students because it would provide lecturers with state of the art business experience. Games development firms would benefit by having highly knowledgeable researchers addressing practical business issues. Universities would also benefit because the scheme would strengthen links between the games sector and higher education and generally aid knowledge transfer.
Train to Gain
Train to Gain, a scheme whereby employers can benefit from full or partial public funding, should be made even more flexible and used to fund a greater variety of courses at all levels.
The games’ industry’s workforce is exceptionally well qualified. A typical TIGA member like Blitz, Exient or Rebellion will have over 80 per cent of staff qualified to degree level or the vocational equivalent. Train to Gain was originally designed to enable people with low level skills to acquire a level 2 qualification, although it has been made more flexible. In future, Train to Gain should be used to co-fund higher level skills, including leadership and management. This would make the scheme more useful to the games industry.
Greater flexibility in the use of Train to Gain resources would make the scheme more useful to knowledge sectors of the economy, including the games industry. It would encourage more training at higher skill levels.