Film Council chairman Sir Alan Parker, also a respected director, said that if his message was ignored, the UK film industry would continue to be parochial and fragmented.
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We are at a crossroads - we can retreat back to 'little England' or we can mount a sustained assault on wider horizons
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Sir Alan Parker
Too much emphasis is put on making films - which are often not great - and not enough on getting the good ones seen on a wide scale, he said.
There must also be improved training for behind-the-scenes workers and new investment to encourage Hollywood studios to shoot more movies in the UK, he said.
Sir Alan, who directed Evita and Midnight Express, announced his strategy to help the UK capture a bigger share of the $60bn (£38bn) global film market to film heavyweights and government decision-makers on Tuesday.
"We can never be the biggest film industry in the world, but we should be right up near the top of the league - not permanently hovering in the relegation zone," he said.
"The UK film industry is not in need of quick fixes and band-aids if we are to succeed on the world stage. It needs nothing less than radical re-invention."
His plan aims to:
The UK industry can no longer continue as a fragmented "little England" collection of small companies making parochial films, Sir Alan said.
"That, I suspect, is what many people think of when they talk of a 'sustainable' British film industry," he said.
"Well, it's time for a reality check. That 'British' film industry never existed, and in the brutal age of global capitalism, it never will."
A rapid expansion of talent needs to take place, he said. "It is the life-force that will protect the UK's ability to make films."
Without Lottery money and current tax breaks, there would be no such thing as a British film industry, he said.
"We are at a crossroads. We can retreat back to 'little England'. Or we can mount a sustained assault on wider horizons. The choice is there for all of us."
The number of UK films produced has fallen by 40%, a recent report suggested, while there has been a 57% fall in overseas investment.
'Active role'
The government described the points raised by Sir Alan as "major areas of concern".
"We look forward to working with other government departments and the Film Council, and to taking an active role in discussing the proposals," film minister Kim Howells said.
The government had already helped by providing tax breaks and setting up the Film Council, he added.
Film Council-backed movies like Gosford Park and Bend it Like Beckham have been critical and commercial successes around the world - but other UK films have struggled to get deals to be shown in cinemas at all.