UK film body the Film Council has revealed that it plans to fund distribution through its National Lottery Premiere Fund.

The $14.6m (£10m) annual fund, launched in October to back production on mainstream pictures, will use a range of methods including sharing p&a costs with distributors or footing the cost of a minimum guarantee and taking UK rights. Premiere Fund chief Robert Jones will decide which of its projects merit distribution support on a case-by-case basis, noting that only some films will receive funding.

"One problem with British films is that some of those that are capable of reasonable business don't get the chance to get their heads above the parapet," Jones said.

The UK distribution sector has largely missed out on lottery support, which has focused on production. The proposed All Industry Fund was to support distribution through industry-wide levies but was aborted due to lack of support from other sectors.

Some stronger independent distributors have dismissed the value of p&a support, pointing out that they can cover p&a if films are good enough. But Jones argued that few UK distributors can give a marginal film a major release that will set it up for ancillary markets.

"A lot of US studio films get a very heavy spend which largely drives ancillary prospects," he said. "They know they probably will not make that money back theatrically but the ancillary values may make it up. That doesn't happen on British films."

Smaller distributors are also hoping that, by offering minimum guarantees, the Film Council will free up lottery films. Most lottery-backed features have needed a distribution commitment at financing stage or gone through the three studio franchises, which have distribution already attached. "There's a chance that there could be more product around," said one distributor.