Federal Government unveils $400 million location incentive fund

The Federal Government has announced a seven-year, $400 million incentive to attract film and television productions to Australia.

The government says the extension of the current $140 million Location Incentive Program (LIP) will generate an estimated $3 billion in foreign spending and create up to 8,000 jobs.

While the initiative will be welcomed by Ausfilm, studios, PDV facilities and crew, the timing is odd given the government is yet to respond to the options paper review.

Virtually all the submissions from key stakeholders to the review called for the Location Offset to be raised from the non-competitive 16.5 per cent to 30 per cent.

Free TV Australia expressed frustration at the timing of the announcement amid the ongoing review into local content, quotas and support for the domestic industry.

“It’s difficult to understand why the government has made a one-off decision now about a single element of the mix right in the middle of this process,” Free TV CEO Bridget Fair said.

“Free TV broadcasters and the broader production industry urgently need a timetable for the decisions from government so we have some certainty on when the much-needed reforms can be implemented.”

Seven West Media CEO James Warburton said: “While we support increasing the Location Offset for foreign productions it is frustrating and disappointing to see this seemingly given higher priority than fixing the broken regulatory regime for Australian content.”

Screen Producers Australia CEO Matt Deaner welcomed the announcement but warned that if the suspension of the drama, documentary and children’s content quotas is extended next year, that would mean the loss of between 10,000 and 15,000 full-time equivalent jobs.

“The lack of certainty regarding the application of the quotas in 2021 is heavily distorting the market and throwing doubt over projects which were well developed and ready to be greenlit,” Deaner said.

The government says the new fund effectively raises the Location Offset to 30 per cent. Indeed, it will make Australia an even more attractive destination for US and other international producers, capitalizing on the country’s success in containing the coronavirus pandemic, notwithstanding the current outbreaks in Melbourne and parts of Sydney.

Village Roadshow Studios president Lynne Benzie tells IF: “This will create more certainty for projects to consider filming in Australia and allow the industry to provide sustainability for everyone and create the valuable support and jobs the industry needs.”

Announced in 2018, the LIP, which has supported 10 projects worth $1 billion, was almost fully committed and due to run until June 30 2023.

Among the latest recipients were Dick Cook Studios Australia/AMPCO Studios’ upcoming Rangers’ Apprentice and The Alchemyst; currently shut down projects, Tony Ayres Productions/Matchbox Pictures/ Netflix’s Clickbait, Paramount Pictures TV/Apple TV’s Shantaram and Marvel Studios’ Shang-Chi and the Legend of the Ten Rings; and Marvel’s Thor: Love & Thunder.

Announcing the fund, Prime Minister Scott Morrison said it would help the screen sector’s recovery from the COVID-19 impact.

“This investment is key to our JobMaker plan to create jobs, boost local business activity and provide training and skills,” Morrison said

“Behind these projects are thousands of workers that build and light the stages, that feed, house and cater for the huge cast and crew and that bring the productions to life. This is backing thousands of Australians who make their living working in front of the camera and behind the scenes in the creative economy.”

Minister for Communications, Cyber Safety and the Arts Paul Fletcher said: “The Location Incentive is an economic multiplier. It will sustain the vitality of Australian screen production and support jobs and local businesses.

“Through this additional commitment, the government is telling the world that Australia is a desirable destination for screen production – with great locations, skilled crews, world-class talent, post-production expertise and state of the art facilities.”

Ausfilm CEO Kate Marks said: “International screen production delivers sizable amounts of expenditure in a short space of time, can tool up quickly, and creates employment immediately. Today’s announcement ensures Australia will now be in a position to secure a significant pipeline of large budget productions across Australia into 2021 and beyond and will increase our market share of global production activity.

“The success to date that Australia has had in combating the COVID-19 pandemic has generated even greater interest in Australia from international filmmakers and studios.”

Ausfilm estimates it has received $1.2 billion worth of production inquiries from US-backed feature film and TV series looking to film in Australia so the $400 million will ensure Australia secures some of these productions, she added.