The British film industry is waiting on more detail from Alan Parker, the UK director and chairman of strategy body the Film Council, after he unveiled a blueprint for curing Britain of its 'little England' syndrome, partly by providing tax breaks for local and foreign distributors which invest in British film.

In a far reaching speech this week to the industry, Parker called for the existing production-focused tax breaks for British films - which expire in 2005 - to be replaced with a new distribution-led tax break.

Although no details have been given, it is understood these could take the form of factoring p&a costs into the production costs of a film to take advantage of the existing sale and leaseback deal or by encouraging foreign distributors, including the US majors, to set up joint venture companies in the UK to invest in British films.

"Direct subsidy solely to production will never, ever form the basis of a successful film industry - even if we double, triple or quadruple the money presently on offer," said Parker, director of Angela's Ashes and the upcoming The Life Of David Gale. "We need a tax break that gives incentives to distributors - both strong independents and American studios - to invest in and acquire British films."

He added: "We need distribution-led companies to carve out a British share of the $60bn world market."

Although most people Screen International talked to praised Parker's spirited and comprehensive approach, his focus on an increased investment in training and the need for a more distribution-led industry, many found the devil to be in the details.

Distributors are sceptical about the effectiveness of tax incentives for a sector driven by market forces: "Tax breaks, in whatever form, are not really enough," says Zygi Kamasa, co-managing director of Helkon SK, which scored a box office hit this year with Bend It Like Beckham. "If a film's any good, we're already in a position to buy it and spend the appropriate amount of p&a on it. It would only encourage me to spend more p&a on marginal films, not invest more in British films."

Exhibitors were equally cautious about the impact of subsidising the release of British films. "Odeon selects which films it plays according to commercial merit," said Richard Segal, chief executive of Odeon Cinemas. "Last week, across our 99 cinemas, we were playing 69 different films."

Producers were generally more supportive: "If producers can get some help with the p&a it would make them more attractive to a US distributor," said Jeremy Thomas of the Recorded Picture Company, whose credits include Young Adam and To Kill A King. "Once you've got a US distributor, the rest just falls into place."

They were less happy, however, that Parker has effectively sounded the death knell for the production tax breaks beyond 2005 and that he had described independent producers as "entrepreneurial talent" incapable of building a sustainable British film industry via "a stable of rights-owning production companies".

"I'm very fearful for what would happen to UK production levels if there was no production tax breaks," said Thomas, singled out by Parker as a "shining example" of a British producer as studio "mogul". "At the moment you can get 14% [of your budget] from it. That's serious money."

"The tax breaks have made all the difference in terms of making a film and keeping control of the film," said Barnaby Thompson of Fragile Films, whose credits include SpiceWorld, An Ideal Husband and The Importance Of Being Earnest. "But if the cost of p&a were factored into a sale and leaseback deal, that would make real difference."

However, producers and distributors were united behind Parker and the Film Council's aggressive moves to persuade the Government that the UK's broadcasters should be forced to invest in an increased number of British films.

"What would have the biggest impact on me would be a quota on broadcasters," said Kamasa. "If BSkyB [the UK's only pay-TV operator] was made to buy 10 British films a year, that would encourage me to invest more in British films as I would know I could get£700,000 for each film from BSkyB."

"It is appalling how little British TV companies invest in film," said Thomas. "It is easier to sell my films to American companies than British ones as they are the ones that have the deal with BSkyB. I hate quotas but something has to be done."

"TV is the huge issue," said Barnaby Thompson. "We are so far out of step with the rest of the world in terms of what our broadcasters invest in film. My gut says yes to quotas."

David Thompson, head of BBC Films commented: "Although I'm not in favour of quotas for broadcasters, what we need is for the other broadcasters to get involved in British production."