The arts sector in Australia is set to bloom even further as the Australian Office for the Arts 2010 Review reveals that Government support for the film industry is at its highest level ever but there are complaints that the paperwork is over complicated.
Key findings reveal that in the three years since the introduction of the Australian Screen Production Incentive, the Government has provided AU$412.1 million in support through the tax system, compared to AU$136.7 million in the three years before the package.
The strong uptake of the Producer Offset alone has provided AU$266.63 million in indirect Government support to the end of 2010, and the Location and Post, Digital and Visual Effects Offsets have provided AU$67 million. In 2009/10 Screen Australia provided AU$61 million in support through production investments.
According to the review early signs show that it is encouraging domestic feature film production, with total production expenditure in 2009/10 of AU$265 million, an 88% increase above the five year pre-Producer Offset average. It is also encouraging increasing interest in Australia as a co-production partner.
‘The review shows expenditure on film and television in Australia is at an all time high and we are seeing greater production values in our feature films and television drama productions. There has also been an increase in the average number of Australian productions, giving audiences access to a greater range of Australian stories,’ said Simon Crean, Arts Minister.
‘This review has allowed the Government to consider its support for the viability of the independent screen production sector. It has highlighted the strong achievements by the sector and provided an opportunity for industry stakeholders to tell the Government about current challenges, particularly in relation to Australia’s attractiveness to international productions,’ he explained.
‘The Government’s overall support for the sector is also at its highest level ever. There are early signs that the Australian Screen Production Incentive, as well as the direct support by Screen Australia, are having a positive impact on the sector’s viability and sustainability,’ he added.
However, all submissions to the review had noted that the Australian film industry is not sustainable without government assistance through both direct funds from Screen Australia and indirectly through the various offsets. While almost all producers who provided submissions to the review or who participated in the focus group sessions were in favour of the Producer Offset, most found that the offset had resulted in increased administrative burdens.
The rigorous application process, the time taken for Screen Australia to process an application and the need to submit a separate application for direct funding were the most common administrative issues raised in submissions.
Submissions also reported that operating within the tax system has some limitations, including the additional costs to producers associated with the timing of the offset payments. Timing of payments can also lead to bunching of productions close to the end of the financial year.
The report said that these issues were considered when the offset was introduced and the Government took the position that such concerns were outweighed by the benefits provided through the security of the tax system. There are opportunities to simplify the operation of the Producer Offset by making changes to the definition of QAPE, though this will require legislative amendment.
‘The production incentives marked a significant shift in Australian Government support for the sector to improve its sustainability. This shift has been positively received by industry, and feedback has highlighted the importance of production incentives to a viable screen sector,’ Crean said.