Pinewood Studios: Business Case and Economic Impact Assessment

Pinewood Studios LtdPinewood Studios: Business Case and Economic Impact AssessmentJanuary 2013(ii)DCMS’s Creative Industries Economic Estimates, figures are provided in terms of the value ofexports attributable to creative industry sectors. From this data, an average export valueper employee estimate has been derived for creative industries 51 (£22,300, 2012 prices) andfor the UK economy as a whole (£3,100, 2012 prices). The former has been applied toestimates of direct on-site activity and the latter has been applied to the indirect, inducedand wider employment estimates.PSDF impact assessment4.3.3.2 The assessment of the economic impact attributable to the project has been informed by areview of the PSDF development proposals and the establishment of a business case to test thefinancial and commercial viability of the scheme. In relation to the business case, a 20 yearfinancial model has been developed for the PSDF based upon Pinewood’s existing 5 yearbusiness plan. Key assumptions contained within the model are based upon Pinewood’s current5 year assumptions which have been updated to reflect the development proposals asappropriate. A summary of the business case is presented in Section 3.3 above.Gross impact4.3.3.3 On the basis of the PSDF, the Economic Impact Assessment has quantified the key benefits thatare expected to be created through the implementation of the development proposals. Theanalysis has included an assessment of temporary and permanent jobs, GVA, Exchequercontributions and contribution to UK exports. The methodology used to estimate each benefitwas as follows:temporary construction employment – in order to estimate the number of temporaryconstruction jobs generated under the PSDF, the expected project capital expenditure(including professional fees and contingency costs) has been divided by an average turnoverper construction employee figure of £144,570 52 . Construction employment has beenidentified in terms of person years and ten-year full time equivalent (FTE) jobs 53 ;direct on-site employment:Pinewood staff – the proposed expansion of facilities is likely to result in the need foradditional ancillary staff on-site. The increase in Pinewood staff has been based ondiscussions with PSL and the business planning work undertaken as part of developingthe business case;tenant company employees – in order to estimate the likely quantum of employmentcreated through the provision of additional office accommodation, employmentdensity ratios have been applied based on the responses to the survey of tenants andassumptions in relation to the expected occupancy rate have been used; andproduction company employees – in relation to the number of people working onproductions at Pinewood, the increase in employment under the developmentproposals has been based on the quantum of new production floorspace that will be515253This includes the following sectors: film, video and photography; digital and entertainment media; and TV and radio.Based on Annual Business Survey 2011 data, adjusted to reflect 2012 prices and full time equivalent employment.In line with convention, ten person years of temporary employment is taken to be equivalent to one permanent full time job.43