$92.7m: the morning after

Tina Kaufman

Until recently, the Australian film community was in a state of nervous discontent following some years of static or declining government funding. Despite several reports on industry concerns over low development and falling production levels, and high profile deputations to Canberra, the Federal Government had hardly responded to the growing sense of crisis. When the Australian Tax Office ruled against tax concessions for investors in Red Planet and Moulin Rouge, it seemed as if even the expanding offshore production sector was under threat. Despite this, however, overall production in Australia has continued to grow and spread in style, content and diversity. Overseas films and television productions are being made at the Fox Studios in Sydney and the Gold Coast Studios in Queensland, employing local casts and crews, using local post-production facilities and putting money into the local economy. We’re seeing a seemingly ever-increasing number of low budget/no-budget productions, short films made for short film competitions and festivals that proliferate across the country and the calendar, and guerilla features made on digicam and bankcard.

At the beginning of September, everything changed. The Federal Government announced a comprehensive package of assistance for the local film industry, comprising increased funding of $92.7 million over 4 years for the Australian film bodies, including the Film Finance Corporation, the Australian Film Commission, Film Australia and SBS Independent (in recognition of that organisation’s success in beefing up a limited funding allocation to an impressive production slate. Head of SBSI, Glenys Rowe, is now talking about the possibility of a miniseries). The package was bolstered with a new refundable tax offset for qualifying large film productions, to act as an incentive for foreign productions made in Australia. Euphoria reigned, and spokespeople for the film bodies and industry groups rushed to welcome the injection of urgently needed funds into the industry, as well as the reassurance provided to foreign investors who could have decided against Australia after the adverse Red Planet decision.

(To attract local investors, offshore productions shooting in Australia had been using an Australian tax concession, Division 10B of the Tax Act, which allowed 100 percent deduction on investment over a 2 year period, and had much less stringent local content requirements than the better known Division 10BA, more commonly used for Australian films. However the ATO recently decided that these concessions should not be allowed, as the investment was not ‘at risk’, the condition that allowed the concession in the first place. A recent report has estimated that offshore production had brought over $600 million into the country over the past 4 years, with that cash inflow promising to increase substantially.)

Kim Dalton, chief executive of the AFC, welcomes the government’s announcement. “It’s a package, as far as the local production industry is concerned, that works across the key agencies involved in the areas of development and production.” Although there have been complaints that the increases in funding only restore what had previously been cut, Dalton believes that to a certain extent the level of funding that’s been provided is the level which the government clearly feels is appropriate to the size of industry that they’re prepared to support. “And the fact that the government has decided to intervene in the area of foreign production as part of the package is a recognition that foreign production is an important component of the Australian industry, an understanding that the local production sector and the foreign production sector are interdependent and should be addressed so.”

Director (and past Australian Screen Directors Association president) Stephen Wallace is less enthusiastic. “Of course we should be grateful for what we’ve been given, and we are…But really the FFC needed much more, because basically what they’ve been given is just for high end TV production. There are apparently $200 million worth of projects they could invest in, and they’ve got $48 million. We know it’s not enough, because three-quarters of the people in the industry aren’t working.”

But Dalton believes that higher budget television production has been an area of concern in the local industry. “The number of miniseries now being produced is very low, one to two a year, and for a form that’s very popular with Australian audiences, that’s unfortunate. It is an issue to be addressed in the context of the current review into Australian content standards by the Australian Broadcasting Authority. The ABA has already set levels of first-run children’s drama but there clearly remains a problem about how that level of quality drama is going to be funded. Part of the government’s new package, $7.5 million next year and $10 million the year after, to the FFC, is specifically directed at adult drama and children’s drama, and will go some way towards dealing with this. But it is still a concern.”

The new tax incentives look set to benefit only foreign film productions, as few Australian films have the at least $A15m budget required to qualify for the tax benefits. Wallace wishes that the government had looked at improving the tax benefits available to those who invest in the Film Licensed Investment Company Scheme (government-sponsored schemes to raise concessional money for investment in film), which are having a hard time attracting investors at the moment. “We need some other doors to investment in local production; currently the FFC is the only door, and it controls everything.” He also believes that the requirement that a local film project have an Australian distributor has narrowed things down dramatically, given that Palace is the only distributor really offering support, but there’s a 6 month wait to even have a script read at Palace. “I just wish the government would look at some of the issues that actually mean that there’s only one door for investment and that’s the FFC. We need more doors, more diversity in funding.”

After releasing an important review into the state of development in the local industry, which concluded that we spend far less, and take far longer, on this vital component than most other national industries, the AFC last year reallocated its internal priorities to highlight and support its primary developmental role. The increased funding it has now been promised will allow it to further sustain the vital areas of script and professional development for not only features but short films, documentary, animation and interactive media. “We’re now funding what we believe to be some really interesting and strong projects, and those projects have been put to us by teams, often writer/producer, and sometimes writer/producer/director, teams of people who are the more established players within the industry. That’s something we wanted to do, to say to the industry that by development, the AFC didn’t only mean the development of new and emerging talent (although we continue to do that), but the provision of a proper level of development funding to established practitioners. Those people are coming back to the AFC, and are appreciative of the fact that we are attempting, within our limited resources, to provide high levels of support.”

“I thought I was making the first of what would be a series of Asian Australian co-productions—that there haven’t been many since is very disappointing,” said director Brian Trenchard Smith at the screening of the restored version of his first feature, The Man From Hong Kong (1975), on the closing night of the second Sydney Asia Pacific Film Festival (see p20). “Australia’s closest relationship is with Asia, we should be choosing subjects that appeal to both markets. If we’re short of finance in this country, look to Asia. What’s important is that you put time and effort into your script, make your characters real within the genre you’re using—it’s not easy, but it’s worth trying. Co-productions are a very good way of hedging your bets, and they also double your prospects of making money, as long as the film appeals to both markets. Golden Harvest was able to milk (Man From Hong Kong) in the Asian markets, and the rest of the world was gravy.”

“It’s not up to the AFC to socially engineer the industry,” says Dalton. “If writers and producers come to us with ideas along these lines, we’d look at them. There’s certainly no resistance to such a development. But the reality is that the majority of the films that get made in Australia are going to focus on very specifically Australian stories, and the ones that do move off our shores—given the realities of finance and casting—tend to look towards Europe or America.”

But if people are still managing to develop projects and to get into production, why is it so hard to get audiences to watch Australian films? In a recent television interview, producer Jan Chapman talked about the Australian features that had done well in Australia but had been unable to translate this to overseas results, either not selling in other territories, or underperforming on overseas release, often despite good reviews and promotion. Films like Looking for Alibrandi, The Dish and Chopper are probably among those she had in mind. In an increasingly crowded world market, Australian films have a problem; for a small industry that can really only afford to make relatively small films, the way to go, financially as well as creatively, is to make films for the domestic market even though that market is dominated by US product, and local success is still hard won (apart from Moulin Rouge, which is counted as an Australian film, only Mullet and The Bank either have or look as if they might make a little dent in the local box office this year). “We have the immense disadvantage overseas in that we were once so fashionable, and we’re not even slightly fashionable anymore,” says producer Richard Brennan. “And even locally we’re competing for distributors and release dates. And when we do get a release, we have very little to spend compared with US films with lots more money for promotion and advertising.”

Dalton argues that it’s the market conditions that have altered dramatically. “It’s much harder, not just for Australian films, but for British films, or any other specialist cinema. The market has contracted, and it’s tougher out there to sell films internationally.”

“What we need,” says AFI Director Deb Verhoeven, “is a genuinely national cinema, in which films are not only produced, but are watched by an appreciative audience. We need a recognition of a viewing nation—we don’t really seem to have that concept. The funding cuts that the AFI has experienced are simply a demonstration of the lack of importance given to exhibition and the audience in the overall film community. What we have in Australia is a viewing population, not a viewing nation. We’re a great audience, but not really for our own films.”

RealTime issue #45 Oct-Nov 2001 pg. 19

© Tina Kaufman; for permission to reproduce apply to realtime@realtimearts.net

1 October 2001