As there are no other contributors I call on the Minister to conclude the debate.
Supplementary Estimates, 1997. - Irish Film Board (Amendment) Bill, 1997: Second Stage (Resumed).
Question again proposed: "That the Bill be now read a Second Time."
Acting Chairman
I listened with great interest to the contributions by Deputies to the Second Stage debate and am greatly encouraged by their positive nature. A strong feature of the debate has been the welcome high number of contributors and the clear indication of crossparty support for the activities of the Irish Film Board and for the continued need for a funding agency to provide development and production loans for film projects. I also welcome the cross-party support for other incentives to develop the industry, such as the section 35 tax incentive for private sector investment in film and television projects administered by my Department, and the acceptance that the development of the industry provides tangible economic and social benefits to local and national economies, while also being an important input to Irish cultural expression.
I welcome the favourable response of many Deputies to my intention to implement the two commitments relating to film policy contained in the Government's programme, An Action Programme for the Millennium. These are the establishment of a screen commission and an industry think tank with the task of developing a strategic ten year plan for the industry. I am grateful to those Deputies who wished me well in driving the Government's film policy forward in the years to come.
Some Deputies, including Deputies Donal Carey, Michael D. Higgins and Liz McManus, were concerned that I have somehow been remiss to date in implementing the Government's commitment to establish a screen commission. This is not the case. The former Minister for Arts, Culture and the Gaeltacht announced the establishment of a screen commission on 4 June, two days before the general election. The preferred method of funding was to be from recoupments on loans advanced by the Irish Film Board since 1994. However, these funds were not immediately at his disposal and the screen commission could not, therefore, be established and funded on this basis at that time.
Film board recoupments, that is repayments to the board of development and production loans which now cumulatively amount to £800,000, represent repayments from EU-supported capital provisions for development and production loans under the Operational Programme for Industrial Development 1994-9. Any decision to use these recoupments for any purpose other than development and production loans for the industry requires the express approval of the European Commission. Coincidentally, this approval was conveyed orally to my Department at a meeting in Dublin of the monitoring committee for the operational programme on 6 November, the day after the Second Stage debate began. The necessary technical decisions to allow the funding of the screen commission were also taken at that meeting. The approval of the European Commission will not be operative until 1 January next year and formal written confirmation from the Commission is not yet to hand. I reject, therefore, any suggestions of foot dragging by me on this commitment. It is entirely appropriate that I discuss with industry interests, RTE and the Irish Film Board their priorities for a screen commission and views on the film board model before proceeding further. I am pleased to inform the House that I have already met Film Makers Ireland to discuss, among other things, their priorities for a commission and I will meet the Audio-visual Production Federation of IBEC, RTE and the Irish Film Board very soon. I expect to be able to make a decision on this matter very soon afterwards.
Deputy Donal Carey asked whether the Irish Film Board should follow the policies of other State development companies, such as Forbairt, which is now using preference shares and equity more frequently when investing. He also asked my views on a rotating fund model for the board. There may be some misunderstanding on the Deputy's part about the nature of assistance offered by the board. Such assistance is not grant-based but rather involves production loans. While the conditions for such loans are negotiated for each project, the norm is that the board takes an equity share in individual projects, facilitating the board's recoupment in first position from all Irish receipts — theatrical, TV and video — preferential corridors from Rest of World Sales and a percentage of World Net Receipts. Therefore, the recoupment and profit participation conditions attaching to production loans from the board correspond with the model recommended by the Deputy. Development loans awarded by the board must be repaid before a production loan is given.
On the board operating its support for film production through a revolving fund, when the board was first established in 1980 it was hoped that its investments could attract sufficient returns to enable its income to operate as, in effect, a revolving fund. However, the board's experience as well as the international experience of public funding agencies for film production is that this is not a realistic expectation. In this context it is necessary to bear in mind a number of central points.
Debate adjourned.
Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.