In the Australian film and television production industry, locally owned small businesses compete with huge multinationals – studios and networks like Disney, NBC Universal, Warner Brothers, German giant RTL, UK’s ITV and even the BBC. We are all competing for the same eye-balls on screen and the same crews to make the shows.
On Friday the Morrison government announced a $400 million package to assist the attraction of foreign blockbuster productions to Australia – productions exclusively made by the foreign multinationals.
The Morrison government is to be congratulated for its support of the film and television industry. Despite the perception, over the last three decades Liberal governments have always been more supportive of our industry than Labor governments.
But here’s the rub, unlike every other industry, the government is subsidizing foreign producers while local productions receive far less, indeed in most cases, no government support.
It will be argued that having big US movies made here is good for local skills. However, I haven’t yet seen an example of international work practices helping a local show get made. What it does do, is drive up the cost of production and instil wasteful habits in crews. At a time when we need to become more efficient, the flow on effect of this scheme is inflationary for the local industry which has to attempt to compete for crew using our much lower budgets vs. their cashed up mega budgets. An unintended consequence is it becomes harder for local producers to hire Australian crews and technicians to work on Australian shows.
The scheme helps technicians and carpenters get employed, and gives minor roles to actors – all worthwhile. But whilst this kind of stimulus creates jobs in the short term, these foreign owned companies will happily relocate to whatever jurisdiction offers the best deal. Meanwhile, ideas are the raw materials for our industry. This scheme does nothing to foster the creation of new ideas.
The local industry relies on creative thinking by writers, directors, and production companies. These three groups are not engaged at all on foreign productions. The new scheme stuffs cash into the pockets of the studios on the false premise that helping the foreign productions is of benefit to the local sector. It isn’t.
New local ideas made by Australian companies also generate actual export income – again, this is something that can’t be claimed by the foreign companies. Their shows sell all over the world, but they do not repatriate all foreign sales income to Australia, otherwise they would have to pay tax and we can’t have that, can we?
These companies are world leaders in production. But they are also often world leaders in tax avoidance. We need more thought on how to make them pay their way here and how to encourage local creativity at the same time. They and their shareholders don’t pay tax here. Some state governments also exempt them from Payroll Tax. So we are in a bizarre position where the local industry pays tax, while the government subsidizes our competitors, who don’t pay tax.
Those same foreign companies also sell their overseas made content to broadcasters in Australia for a fraction of its actual production cost. In any other sector this would be illegal under our anti-dumping laws.
It’s a tough business to be in, but the screen production sector is one industry where machines cannot replace actual people doing jobs. Our local industry has always punched above its weight but we are reeling from COVID. Right now, there is a government inquiry under way to decide on a balanced system of support mechanisms for the entire industry. The odd thing about Friday’s announcement is it locks in a system where foreign productions get more support than local production. We need regulation and support that fosters an environment to create shows out of the germs of ideas, because unlike the foreign productions, we’re here for the long haul.
Nick Murray is a TV producer and co-founder of CJZ which makes shows like “Bondi Rescue” and “Gruen”. Its latest production “Shaun Micallef’s On The Sauce” premieres on Tuesday night on ABC TV.
Top Photo: CJZ founders Michael Cordell (left) and Nick Murray