I move: "That the Bill be now read a Second Time."
This is a short Bill with a simple purpose. As is the norm for Exchequer funded State bodies, a statutory ceiling is set on the cumulative capital outlay, commitments and liabilities which the body may incur. This must be updated by the Houses of the Oireachtas every three to five years. The Irish Film Board Act, 1997, increased the ceiling from £15 million to £30 million. This will be reached before the end of the year because of the strong Government commitment to the film sector and the greatly increased activity of the board. I intend to accelerate still further the pace of development by providing substantially increased resources for the board in coming years. The Bill proposes to raise the ceiling on authorised issues from £30 million to £80 million, an increase of £50 million.
Recognising the growing importance of the creative audio-visual production sector for our cultural expression and economic prosperity, I established the film industry strategic review group in 1998 under the chairmanship of Mr. Ossie Kilkenny to review progress in the sector and make recommendations for its further development as we face into the early years of the new millennium. The review group submitted its report in August 1999. It recommended a strengthened, broadened, restructured board to address the new strategic goals of the industry focusing on script development; development and production finance; strategic business development; generic marketing of Irish films, cinema going and video rentals; promotion of Ireland as a film location; training and development; production expertise; technological policy, development and foresight; co-ordination with the television broadcasting sector, and Irish language television production.
The Government has approved a strategic plan for the industry closely based on the conclusions of the strategic report. I have, accordingly, reviewed the resources of personnel, current funding and organisation required by the board for the expanded scope recommended for it in the review group report. In this process my Department engaged management consultants to review the organisation and management of the board. They reported during the summer whereupon I invited Mr. Kilkenny who had earlier been appointed by me to the position of chairman of the Irish Film Board to draw up a plan of action based on the review group's recommendations and taking into account the report of the management consultants. The board is finalising its plan for the next five years to push the industry forward into a more mature phase of expansion and commercial viability in this new decade.
In the first phase from the early 1990s there was a particular emphasis on attracting large international productions to use Ireland as a location to build and sustain the production infrastructure and develop the skills base as indigenous production was insufficient to support the infrastructure and skills which are essential to the industry. Incoming productions will remain essential to the further growth of the industry. The time is now ripe, however, to look to a scaling up of our domestic production companies. To help in the achievement of this the Government is fostering a favourable environment for long-term business planning and investment in the industry by a strategic approach to the development of the industry; a five year extension of section 481; increased funding for the Irish Film Board; Enterprise Ireland support for company development, and continuing support for training.
During the 1990s we built a film production infrastructure in Ireland consisting of skills, facilities and creative talent. Ireland now has the highest per capita output of feature films in the EU, and ranks fourth internationally in attracting inward investment. Where do we go from here?
The digital age poses new challenges and opportunities. In the evolving digital marketplace, while continuing to gain strength in cinema and television, companies in Ireland will need to seize the opportunities of diversification of the distribution channels, the emergence of global niche markets and increased competition to win audiences. In the digital age, content is king. Supporting the development of creative skills and production capability is a vital counterpoint to the development of the digital technology and telecommunications industry in Ireland and to the promotion of Ireland abroad.
We need focused business discipline and planning to achieve the emergence of strong, creative, strategically managed companies able to attract the capital resources to develop and produce slates of projects which will appeal to global markets. Audiovisual production is a powerful means of bringing Irish creativity to global audiences. It generates an awareness of and interest in our culture; supports a world-wide sense of Irish cultural identity; complements our international trade promotion and marketing; develops businesses based on intellectual property; and encourages tourism. All EU countries recognise the importance of this sector and the EU Commission recognises the special cultural significance of creative audiovisual production in its state aid rules, allowing more generous support to this sector than to other industrial sectors.
The Government's position, therefore, is that the audiovisual production industry is to be assigned a central place in Ireland's industrial policy. The Irish Film Board will co-ordinate with the industrial agencies of the State in the development of the industry and in particular in fostering strong indigenous companies in the sector. Liaison will take place at top executive level in the organisations concerned to co-ordinate support for the sector. The board's forthcoming five year plan, Strategy and Structure 2001-2005, will set out clearly how it proposes to respond to this challenge.
Project development, from concept through script, market planning, financing the project and the attachment of actors and crew is the phase in which key creative and business decisions are taken, decisions which can determine the market potential of the project. The board will increase its commitment to enhancing the development process. Through an enhanced development loan scheme it will encourage companies to develop beyond the subsistence, single project mode of operation through growth and partnership; provide funding for companies to develop slates of projects, usually three to five projects, so that development becomes an ongoing function; and nurture new talent and creative originality by continuing to support the development of individual projects. There will be a closer integration of training in script writing and script development with the development support provided by the board. This should increase our capacity to produce excellent scripts which can appeal to international markets.
This leads me to the second change of emphasis which will take place in the board's policies. Our capacity to communicate our culture and creativity in the audiovisual media depends on our ability to reach wider audiences. Audiovisual pro duction is highly capital intensive and, therefore, must have regard to the market.
Section 481 and the Irish Film Board schemes are there to facilitate growth and consolidation of companies and the parallel development of a pool of creative, business and production skills. Therefore, every company which applies for support from the board should have a strategic business plan stating what goals it seeks to achieve, what partners it needs to achieve these goals, and the timeframe for their achievement. Practical advice and assistance will be organised to help companies to develop their strategic thinking and plans and the board will place a greater emphasis on the commercial potential of the projects which it supports, seeing them as the basis for helping businesses to grow and their potential to contribute to the achievement of the company's business plan.
I want at this point to refer to the extremely important issue of funding to support the training needs of the film and television production sector. Screen Training Ireland, the agency for film and television training, operates as a national training committee under the aegis of FÁS. Up to the end of 1999, the European Social Fund co-funded the operations of Screen Training Ireland to the tune of 75%, the balance of 25% being provided by the Exchequer through the Irish Film Board. FÁS supplemented this total from its own funds. Now, however, the ESF funding is no longer available for film training. I have, therefore, provided additional capital resources to the Irish Film Board to ensure the continuation of the vital training inputs necessary for the development and expansion of the industry. In providing these funds for training to Screen Training Ireland, and in accordance with my strategic policy for the industry, I expect the Irish Film Board to ensure, in close liaison with FÁS, that the training being delivered is consistent with the strategic needs of the industry.
An important change will be that the screen commission function of the board will now operate integrally within the new, strengthened board. The Screen Commission of Ireland, established in 1997 as a statutory committee of the Irish Film Board, on a pilot basis under the direction of a voluntary panel of industry experts, became operational in 1998 as soon as funding was made available. It was to be operationally independent of the Irish Film Board and it established a separate identity, executive and office.
Whereas the board's focus was on the fostering of indigenous projects and talent, the focus of the screen commission was seen as bringing mobile international projects to Ireland. It represented Ireland at major locations, the principal film markets in Europe and North America and it participated in trade missions to Australia and Canada. As a consequence, several projects came to Ireland or seriously considered Ireland as a location, and business contacts were established. However, in the light of the Film Industry Strategic Review Group's report, which recommends an enhanced central co-ordinating role for the Irish Film Board, and the recommendation of the consultants' report on the organisation of the extended board, it follows that, strategically, the screen commission function should now be co-ordinated under the Irish Film Board itself.
The distinction originally envisaged between indigenous and incoming productions is less clear in practice than in theory, particularly in the case of European co-productions, which often involve a substantial Irish financial and management input into the project. Accordingly, it has now been decided to re-position the screen commission function. It is envisaged that the chief executive of the commission will now report directly to the Irish Film Board and will work in close liaison and co-ordination with the Bord Scannán team. I have no doubt the board will give careful consideration to the question of how best to build on the brand identity, connections and goodwill which have been built up by the screen commission, so that these can be exploited to the full in achieving the board's overall strategic objectives.
I greatly appreciate the professionalism, commitment and considerable time the members of the screen commission have given to their task. Their knowledge of the industry and their prestige has enabled the pilot period of the commission's operation to be an important learning experience, and a very fruitful one. There are many Irish people, people of Irish descent, and friends of Ireland who occupy positions of eminence and influence in this global industry, including members of the outgoing screen commission, who are keen to help us in achieving the goals we have set ourselves. I will explore with the Irish Film Board how we might avail of this pool of goodwill.
To return to the specific topic of the Bill, it will lay the financial foundations for the next phase of the development of the film industry in Ireland. I have outlined the extended role of the board in building upon what has been already achieved. Given the increased expenditure by the board in recent years, the Bill is now urgent, to enable the board to draw down funds for films which will go into production in the coming months.
In addition to the Exchequer allocation to the board, which is voted annually in the Vote for my Department, the board is also authorised to use recoupments of its loans under its schemes – repayment is conditional on certain commercial targets being reached by the film – and I envisage that the reinvestment of such recoupments will continue to play an important part in enhancing the board's support for the industry. The board, of its nature, is not a commercial bank and one of its principal functions is precisely to provide finance on terms which could not be offered by the commercial banking sector. However, as the industry matures it might be expected that the present recoupment rate of 13% should improve, providing additional resources for reinvestment in the industry.
Two issues arose in the course of my review of the Irish Film Board which should make my position clear. First, the question was raised of a change in the name of the board. I am opposed to this as it would suggest a break in the continuity of our film policies. The current title of the board, in Irish and in English, makes it clear that it is the State agency in Ireland with ultimate responsibility for the implementation of Government policy on film. This is as it should be. Second, it has been suggested that the board should be entirely based in Dublin. Deputies will be aware of the importance given by the Government to decentralisation. I do not envisage the board's headquarters moving from Galway. I agree with the board's approach, however, in having an office in Dublin and it will be a matter for the board to decide how it should organise its work as between Galway and the rest of the country.
I appreciate the Deputies' co-operation in expediting the enactment of this short but vital Bill. As I have indicated, a number of imminent film productions are awaiting its passage to receive support from the board, hence its urgency.