I move: "That the Bill be now read a Second Time." I am pleased to have the opportunity to open this debate on the Second Stage of this Bill. It will provide an opportunity for Deputies to consider the performance of Bord Scannán na hÉireann/the Irish Film Board since its re-establishment in 1993, the last occasion when a Bill dealing with the board's activities came before the House. It will also provide Deputies with an opportunity to express their views on the future of the Irish film and television production industry and I look forward to hearing those views with considerable interest.
This Bill specifically relates to one of the State bodies which operates under the aegis of my Department - Bord Scannán na hÉireann/the Irish Film Board. I propose to concentrate my remarks on the activities and the performance of the board since its re-establishment in 1993. However, while the Irish Film Board is a central plank in nurturing and developing the Irish indigenous film industry as an important input to both the cultural and the economic development of the State, I regard the tax incentive scheme for investment in film and television projects under section 35 of the Finance Act, 1987, as amended — an incentive administered efficiently by my Department - as being of equal importance in achieving those goals.
Since its introduction by a Fianna Fáil Government in 1987, section 35 has played a central and critical role in mobilising private sector investment in the development of the industry. It has also been instrumental in attracting significant non-indigenous film and television productions to locate their shooting in Ireland, and this activity represents a critical input to the development of the indigenous industry. I welcome the fact that the measure is firmly in place up to 1999 and will sympathetically examine its influence on the industry when it comes up for review.
The Irish Film Board (Amendment) Bill, 1997, is straightforward technical legislation that does not imply any policy change. It is standard practice that, under their legislation, non-commercial State bodies operate within a limit on the amount of loans, grants, etc., they can issue. This figure is increased by the Oireachtas every three to four years by amending legislation, and this process rightly provides the Oireachtas with an opportunity to discuss the activities of such bodies and their sectors.
Section 1 proposes to amend section 10 of the Irish Film Board Act, 1980, which sets a limit on the aggregate amount of any loans, investments, grants or moneys provided by the board, together with the aggregate amount of principal and interest which the board may be liable to repay or has previously paid on foot of guarantees for the time being in force. The original limit provided in the 1980 Act was £4.1 million. This limit was increased to £15 million under the Irish Film Board (Amendment) Act, 1993, and this Bill proposes to further increase the limit to £30 million.
I emphasise that the amounts to be allocated to the Irish Film Board for loans in each year will be decided in the annual Estimates for my Department, which must be approved by the Dáil. Accordingly, the amendment proposed in section 1 is a necessary enabling provision to ensure the board can receive and allocate the resources which will be provided by the Dáil in the coming years. The annual allocations provided to the Irish Film Board since 1993 have by now almost exhausted the limit of £15 million provided under the 1993 Irish Film Board (Amendment) Act. The capital provision for the board for 1997 is £3.721 million which, if expended in full, will bring the aggregate amount of loans, investments, etc., provided by the board to some £15.126 million - in excess of the current statutory limit.
The second measure deals with the subject of the officers and servants of the board. These provisions, which propose to amend section 27 of the 1980 Act, are designed to bring the Irish Film Board's provisions in this area up to date and in line with statutory provisions applicable to other non-commercial State-sponsored bodies. Since, by their nature, non-commercial State-sponsored bodies have an ongoing dependence on grants-in-aid from moneys voted in the Estimates each year, Deputies will fully accept the rationale behind these provisions.
Section 2 provides that board decisions relating to the number of persons to be appointed as officers and servants; their rates of remuneration and allowances for expenses; the terms and conditions of employment with the board; the grades and the number of persons in each grade and the removal of an officer or servant of the board shall be subject to the consent of the Minister for Arts, Heritage, Gaeltacht and the Islands and the Minister for Finance. The purpose of these provisions is, principally, to ensure that the board does not, without due approval of the two Ministers, take decisions which could have cost implications for the Exchequer or be contrary to Government policy in relation to pay and conditions in the non-commercial public sector generally.
Thus two further general provisions are included in section 2. These require the board to have regard to any nationally agreed guidelines and Government policy on remuneration, allowances for expenses and conditions of employment in determining these matters and to comply with any directives from the two Ministers in regard to these matters. The underlying principle of section 2 is that the board of a State body, which is dependent on an ongoing basis on Exchequer support, should not be free to take decisions which have Exchequer implications unless these decisions have been approved by the two Ministers mentioned.
Turning to the activities and the performance of the Irish Film Board since its re-establishment in 1993, I am satisfied with the performance of the board over those years. I commend my predecessor as Minister for Arts, Culture and the Gaeltacht, Deputy Michael D. Higgins, on his role over those years in promoting the development of the film and television production industry in the State. In doing so, however, it is important not to be selective in acknowledging such major achievements.
I remind the House that the range of incentives introduced to develop the film and television production industry owe much to the commitment of the Fianna Fáil-Labour Government appointed in January 1993; to the earlier initiative of the then Taoiseach, Deputy Albert Reynolds, in establishing the Special Working Group on the Film Production Industry in late 1992, whose recommendations underpinned most of the new incentives, and to the highly enlightened approach of the current Taoiseach, then Minister for Finance, Deputy Bertie Ahern, who radically overhauled the section 35 tax incentive for investment in the industry in 1993 and 1994 and agreed to provide funding for the Irish Film Board.
One of the key recommendations of the then Taoiseach's Special Working Group on the Film Production Industry was the establishment of a designated agency to provide funding for film production in the State. Since the legislation for the Irish Film Board remained on the Statute Book, it was entirely appropriate to implement this recommendation by re-establishing the Irish Film Board, which was done in April 1993.
The broad function of the Irish Film Board, as set out in section 4 of the Irish Film Board Act, 1980, is to assist and encourage by any means it considers appropriate the making of films in the State and the development of an industry in the State for the making of films. I welcome the fact that the 1980 legislation provides that, in so far as it considers it appropriate, the board shall have regard to the need for the expression of national culture through the medium of film. In this regard, it is important that we do not become mesmerised by what I might describe as the glitzy image of film-making, mostly epitomised by Hollywood, but rather that we place on the record this Government's determination that its incentives for the industry will enable Irish film makers to tell Irish stories in a more professional and entertaining way and with greater impact, and thus contribute to Irish cultural expression at a national and international level. The Irish Film Board has a critical role to play in this process.
The board exercises its function mainly by the provision of development loans and production loans for film makers. Feature film development loans are intended for research, development and feasibility - up to a maximum of £25,000 - and are repayable on the first day of principal photography. Of the 98 film projects which have been offered development funding by the board since its re-establishment in 1993, 17 have progressed into production. This creditable ratio of 1:6 compares favourably to other European film funding agencies, which I understand achieve an average ratio of 1:10, and to the Hollywood hit rate of 1:15.
Feature film production loans are usually in the range of 10-15 per cent of the overall budget of a film and the board is required to operate under an upper limit of 15 per cent of a film's budget. By the end of this year the board will have given 44 production loans. The board also offers production loans each year for a small number of ambitious documentaries, with an emphasis on feature length documentaries with potential for theatrical, festival and television screening.
In evaluating applications for production loans for projects, the board takes into account the potential for the employment of Irish workers in all technical and creative grades among the cast and crew and especially as heads of department. The House will appreciate that the director and writer of a film are central to its creative texture, to the authenticity of its realisation and to its eventual profile. For this reason the involvement of indigenous directors and writers is one of the crucial criteria for board support. Before the board's re-establishment in 1993 Irish producers were at a serious disadvantage as they had little or no Irish finance to bring to the table and they found it very difficult to negotiate for the employment of an Irish cast and crew or on where the shoot should take place.
Apart from these considerations, obtaining funding for a feature film without support from one's home country is extremely difficult. The position since 1993 is that an Irish Film Board-supported film can go to foreign markets with up to 30 per cent of its budget in place from the domestic market. This takes account of the net contribution of the section 35 element of the film's budget and any other indigenous investment. Apart from this augmented return to the economy as a result of being in a better position to secure foreign investment in films, Irish film makers who are now developing a successful track record are better able to influence where a film is shot and the cast and crew employed. For this reason, the spend in the economy and the contribution made by ancillary services in all stages of production and post-production is a significant factor in the board's consideration of applications.
The production loan is offered on the basis of either repayable loan or equity participation. The board has recouped more than 20 per cent of its total capital investment during the first four years. By international standards this recoupment level is very good and greatly exceeds the returns of other national film funding agencies such as the Australian Film Commission with returns of 9.8 per cent, the British Film Institute with returns of 5.7 per cent and the Council of Europe's film co-production fund, EURIMAGES, with returns of 2.8 per cent. I am also pleased to report that the board made an overall profit on its investment in more commercial films such as "Circle of Friends" and "A Man of No Importance".
I believe the House will agree that this is a creditable performance and that the staff of the Irish Film Board and the board, under the chairmanship of the distinguished documentarist, Louis Marcus, and of his predecessor, Lelia Doolan, deserve our full praise for their achievements. In saying this, however, I hope the board's performance in the recoupment of loans granted is maintained and, if possible, improved in the years to come.
One of the other more positive indicators of the performance of the Irish Film Board to date is that Irish films supported by it have won international critical and audience acclaim at film festivals throughout the world. For example, three of the last four films to win the best film award at the prestigious San Sebastian Film Festival were supported by the board - "Ailsa", "Trojan Eddie" and "I Went Down". It is unprecedented for a country of Ireland's size to achieve such success at this and other premiere international film festivals. More recently, "The Last Bus Home" was voted the best film at the British and Irish Film Festival at Cherbourg in France.
In addition to development and production loans, the Irish Film Board has established funding alliances with RTE, Teilifís na Gaeilge and the Arts Council for certain focused interventions. The board co-funds with RTE the "Short Cuts" series of five to six short film dramas per year. The welcome emphasis here is placed on emerging non-established film-makers and the scheme is viewed as a springboard for film-makers who wish to take on feature length projects. The fact that three of these "Short Cuts" projects - "A Soldier's Song", "Before I Sleep" and "Quando" - won awards at the recent 1997 Cork Film Festival is an illustration of the quality of these shorts. The board and RTE are currently selecting from 150 applications for the fourth series of "Short Cuts". This clearly demonstrates the relevance of this funding alliance between RTE and the board.
A very welcome scheme in the Irish language, which is similar to "Short Cuts", is the new scheme "Oscailt". This scheme will fund between two and four short Irish language film productions each year and is funded by the board in conjunction with Teilifís na Gaeilge. RTE and the Arts Council are partners with the Irish Film Board in funding "Frameworks", an animation scheme designed for creative animation projects under ten minutes duration. Six creative animations are funded under the scheme per year and the third series will be advertised shortly.
The final funding alliance is the "Real Time" scheme which is run in partnership with RTE. This scheme is aimed at cinematic one hour dramas and, unlike the "Short Cuts" scheme, is open to established film-makers. It is designed for films suited to the television format.
As Minister with responsibility for broadcasting and film policy, I offer my strong support for these four funding alliances which acknowledge the importance of television production in the overall development of the industry. Television drama is an essential ingredient in the development of the industry and I hope that further and extended initiatives can be developed between the Irish Film Board and television broadcasters in the future and within existing resources. In this regard the independent television channel, TV3, which is expected to come on air during the second half of 1998 will offer further opportunities for the film and television production sectors. I am confident that much of the programme schedule of the new service will comprise high quality home-produced programming in all genres, including in particular drama. There will also be scope for TV3 to participate fully in the funding alliances to which I referred.
I wish to place on record my appreciation of the assistance the board gives my Department from time to time and, on request, the professional advice it gives relating to film budgets and other matters in the context of my Department's role in certifying section 35 film projects. The board also participates at seminars in Ireland and abroad which have a direct relevance to the promotion of the industry and it provides information and advice to indigenous and international film producers on an ongoing basis. The board's excellent and concise brochure "Incentives for Film-making in Ireland" is now in its second print run and has been widely disseminated abroad. Moreover, with its presence on the World Wide Web, the board is frequently the first call for people seeking information or advice on filming in Ireland.
The board also advises and supports film producers in obtaining other sources of finance outside Ireland. It maintains stands at the Cannes, Berlin and Toronto film festivals and provides support for Irish producers seeking foreign investment and information to international producers wishing to film in Ireland.
The board does not fund cinema exhibitions directly. However, it ran a showcase of Irish films which toured Ireland during the summer of 1996. This is an initiative that could be repeated and strengthened. A very welcome initiative was Cinemobile which was also run in 1996 as part of the celebration of the centenary of the cinema. This touring cinema, which was hired from France and carried on an articulated truck, toured villages and towns along the Border. The board provides matching funding to commercial distributors for the publicity and advertising costs involved in the theatrical launch of boardsupported films in Ireland.
Needless to say, the funding of all the activities of the Irish Film Board which I have outlined requires considerable Exchequer support. This support is provided under subheads N.1 and N.2 of the Vote for my Department and in 1997 the allocation for the board involves £419,000 in administration expenditure and £3.721 million in capital expenditure. The current expenditure of the board involves the salaries of its full-time staff of four persons, its other administration costs and contributions to international commitments such as EURIMAGES, funded jointly with RTE, EUREKA Audiovisual and the EUREKA Observatory. The board also partly funds the EU Media Desk in Dublin and the Media Antenna in Galway.
I warmly appreciate that the capital expenditure of the Irish Film Board is funded up to a maximum of £13 million under the Operational Programme for Industrial Development 1994-1999. EU funding support, from the European Regional Development Fund, amounts to 75 per cent of this amount, with the balance coming from the Exchequer. I cannot over-emphasise how important this European funding is in promoting the development of the film industry in Ireland. It represents a strong acknowledgement by the European Union of the contribution of the European audio-visual industry to economic and social development by way of employment and value added in the EU.
The industry operational programme also includes a provision of £2.58 million for training for the industry, of which 75 per cent is provided by the European Social Fund and the balance by the Exchequer. These funds were released for use earlier this year. They are channelled through the Vote of my Department to the Irish Film Board. The training schemes are administered by the National Training Committee for Film and Television, which operates under the auspices of FÁS and comprises membership from industry interests and the key State interests. It has been agreed that this £2.58 million training fund will be topped up by a £250,000 contribution per annum from FÁS, subject to demand, with significant additional FÁS expenditure on traineeships for the industry. For 1997, the first year of effective operation of the national training committee, it is expected that some £1.2 million will be spent on initiatives organised by the committee.
The analysis outlined in the STATCOM report on "Training Needs to 2000" pointed to the need for focused training interventions in a range of film and television functions, to build on the considerable skills which are being obtained by students of media studies who are graduating from our third level colleges each year. The National Training Committee for Film and Television is addressing these skills deficiencies aggressively. The training initiatives which have already been undertaken or are in train include a television producer-director course; a story editing workshop; a masterclass for directors conducted by a distinguished British director; a marketing and distribution workshop; a course in scriptwriting for situation comedies; traineeships in sound post-production for assistant sound editors; the development of a strategic company development programme, to commence mid-1998; training programmes for industry specialists, including educationalists-trainers; a film scoring course; a production assistants course; and an intensive scriptwriting course for Irish language programming which is just about to commence.
Over the next two years, eight workshops for directors, screenwriters and producers will take place in the partner countries of Ireland and Scotland under the Moonstone initiative between the national training committee and Scottish Screen, which draws from the Robert Redford Sundance training model in the United States. Deputies will agree this is an impressive list of training activities now impacting on our film and television practitioners in Ireland. Because of the overlap in some EU funding to the year 2000, the House can be assured the national training committee will continue to organise focused and high quality training initiatives up to that time and I am confident its activities will greatly improve the skills base of our industry and the capacity of Irish practitioners to obtain upgrades in the film and television hierarchies over time.
I have already expressed my satisfaction at the operations of the Irish Film Board to date. Since 1993 the board has chaired a committee of senior officials of Government Departments and the State marketing and promotional agencies, entitled STATCOM. One of the priorities set by STATCOM since its inception was the establishment of a screen commission for Ireland, which would have the single function of marketing Ireland as a location for film production. Deputies will be aware that earlier this year the Irish Film Board submitted proposals for the establishment of a screen commission to the then Minister for Arts, Culture and the Gaeltacht. The Minister subsequently announced the establishment of a screen commission on 4 June last, based on the Irish Film Board's proposals.
The Government's programme, An Action Programme for the Millennium, commits the Government to the establishment of a screen commission and of an industry think tank which would evaluate the effectiveness of existing schemes and incentives, and formulate a strategic plan for the future of the industry. Before I took up office the Irish Film Board had submitted its draft terms of reference for the screen commission to my Department. I am now arranging meetings with film industry interests, RTÉ and the Irish Film Board to hear their views on the priorities for a screen commission and I expect to make my decision on the commission very soon afterwards.
I also propose to address the other commitment for this sector in the Government's programme, An Action Programme for the Millennium, by establishing the industry think tank as soon as possible. I propose to assign the think tank the task of formulating a strategic plan for the development of the industry over a ten year timeframe. I expect the think tank to examine the effectiveness of the existing structures and incentives in place to develop our film and television production industries and to consider whether our arrangements need to be refocused or restructured over time. In this connection, I am mindful of the recommendation in the 1992 report of the Special Working Group on the Film Production Industry to the effect that there should be a review of the operation of the Irish Film Board after five years.
I am pleased to inform the House that the think tank will have the results of an exercise already carried out by STATCOM to assist it in its deliberations. Over the past 12 months or so, STATCOM has, independently, been elaborating the components of a plan for the development of the industry and it recently submitted a draft to me for my information. I emphasise that the text of the plan has not, to date, been endorsed by the respective authorities of the constituent members of STATCOM, but the value of its existence is that it can serve as a very useful base discussion document for use by the industry think tank. I will, therefore, ask the think tank to draw up a strategic ten year plan for the future of the industry, using the STATCOM document as an opening basis for discussion and deliberation.
I look forward to receiving the full co-operation of the industry in the deliberations of the think tank and I am confident this is the best way to proceed to ensure the achievements of the recent past can represent a sound foundation for the sustained development of the industry over time.
Also looking to the future, I am pleased to inform the House that the conclusion of a Film Co-Production Agreement between Ireland and Australia is very near and I am expediting the final procedures on the Irish side to allow for its adoption when the procedures in Australia have also been completed. The agreement will enable producers in both countries, who enter into film co-production agreements with each other, to source the production incentives available in both jurisdictions for their projects. I place a particular value on the extension of Ireland's co-production contacts with other states. In this regard I expect to be in a position to adhere to the Council of Europe's European Convention on Cinematographic Co-Production in the first half of next year. This convention can apply to bilateral and multilateral co-productions and, since 22 of the 40 member states of the Council of Europe have signed the agreement, I very much hope it will be a means of avoiding the rather lengthy process of formal bilateral treaties with individual states.
Ireland is currently experiencing a sustained high level of film production throughout the State. It is a matter of particular satisfaction to me that, despite the natural attractions of Dublin and Ardmore studios as locations for film-making, no fewer than 17 counties have to date experienced film-making of various degrees of size since the Irish Film Board was re-established in 1993. My own county, Clare, hosted the feature film, "The Serpent's Kiss", in Sixmilebridge, which was very enjoyable. I had the opportunity to visit the set of "Saving Private Ryan" in County Wexford in July, at which I obtained first hand experience of the impact which film production can have on local economies.