Feature film expenditure to fall this year: Screen Aus
By Brendan Swift
Screen Australia has warned that the industry is facing a sharp fall in feature film expenditure this financial year due to fewer planned big-budget local and foreign productions.
The government agency's chief executive Ruth Harley said the Producer Offset tax rebate has bolstered production levels although the outlook remains muted.
"There is a serious risk that a reduction in high-budget Australian features along with the absence of foreign production in 2010-11 will result in a drop in the total expenditure in Australia by feature films," Harley said in a statement.
"In order for the screen sector to continue to thrive, it is vital that Screen Australia continues to provide its direct support for films in the medium-budget ranges which are difficult to finance in this climate with the indirect support of the Producer Offset alone."
Screen Australia today released its annual drama report, which showed total expenditure by feature films and television drama productions rose by 2 per cent to $731 million in 2009-10.
"In the context of a global financial crisis and a downturn in global production, this is a good result and shows that the Producer Offset was the Australian screen industry stimulus package that we didn’t know we needed to have," Harley said.
The result was held up by a sharp increase in foreign productions, particularly The Chronicles of Narnia: The Voyage of the Dawn Treader and Don’t Be Afraid of the Dark, which offset a 27.5 per cent fall in local feature film expenditure and a 12.8 per cent decline in local TV expenditure.
However, both local feature film and TV drama expenditure levels remain close to the three-year average.
The industry is now grappling with a local currency trading above the value of the US dollar, which has effectively ended any short term hope of further runaway productions filming in Australia, unless the government acts on calls for further support made via its ongoing review of the Australian independent screen production sector.
Harley pointed to the large rise in TV drama for adults – which stands at a ten-year high – as a significant positive for the industry. It was offset by a fall in children's drama production although this is expected to rise again in 2010-11.
The Media, Entertainment & Arts Alliance federal director of equity, Simon Whipp, said the Producer Offset and content regulation quotas continue to support local TV production.
"Adjust this lever – as some in the free to air television broadcasting sector are currently suggesting – and you do so at the risk of undermining the entire industry," he said in a statement.
The Producer Offset helped fund three-quarters of all Australian features produced over the past two years and, including television production, added $128 million in total funding over 2009-10, according to the report.
Private lenders are increasingly cashflowing the Offset, which returns up to 40 per cent of feature film production expenditure to producers and 20 per cent for television producers.
Over 40 per cent of the total Producer Offset was cashflowed by banks and other private lenders in 2009-10, while 32 per cent was cashflowed by the film/TV industry and 15 per cent by film funds.
“This is the first year we have seen significant private investment support in the screen industry courtesy of the Producer Offset,” Harley said.
The full Screen Australia report can be downloaded here.