The big-budget movie era in Australia may be coming to a close with government subsidies for filming down under ending early.
Australia’s booming film industry could be facing an uncertain future with government subsidies for foreign productions set to run out years ahead of schedule. In 2007, the Rudd Labor government introduced a 15% rebate on local expenditures which would be made available to foreign productions. This was later raised to 16.5% in 2011, with measures that would make the effective rate 30%.
Large American companies such as Disney used their sizeable influence and power to bully the Australian government into further subsidizing the foreign film industry, citing the “uncertainty and sluggishness of the application process” as a deterrent to filming in the country. In 2018, the Turnbull Coalition government responded to these complaints with an attempt at streamlining the process- introducing the $140 million Location Incentive Fund, which would be expanded to a total of $540 million in 2020.
The fund was planned to last until 2026-2027 but is already starting to look shorthanded in 2023. Across 37 titles, $421 million of the $540 million has already been spent.
The use of the fund has also led to increased subsidies for local production, and last year saw a record $2.29bn spent on screen drama, with Australian content accounting for $1.51bn. Studios are now pushing for a single 30% offset to replace the two-tier subsidy for foreign productions, which they claim would encourage investment in studio space.
Uncertainty around what happens next is beginning to have an impact, with veteran unit production manager on movies such as the Thor franchise and Godzilla Vs. Kong, Jen Cornwell, saying she is “petrified” about what will happen when the subsidy scheme ends. “I’m unemployed,” she said. “We’re all contractors. When it’s over, it’s over.”
The impact of film and television production incentives in Australia was presented to parliament on Monday by the Australia New Zealand Screen Association. The report by consultants Olsberg SPI concluded that Australia’s screen production boom could either grow or collapse depending on what happens next. Schuyler Weiss, the managing director of Bazmark productions, said the more clarity and certainty around the incentives, the more secure the pipeline of work is.
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The profit from the production boom spread to other industries, with 60% of budgets going to people and businesses outside the sector, and a return of $5.89 for every $1 invested through subsidies for foreign productions. The return on investment for local subsidies is $4.40.
Arts minister Tony Burke has not addressed the issue in his National Cultural Policy, stating that it is a budgetary matter rather than a policy one. However, for those like Jen Cornwell, the distinction is not clear.
