Dáil Éireann Debate, Thursday - 1 July 2004
2 Mr. Wall asked the Minister for Arts, Sport and Tourism; his views on whether high production costs are a deterrent to foreign filmmakers coming here to make their films; the consequences of this for the film industry here; and if he will make a statement on the matter. [19826/04]
Amharc ar fhreagra4 Mr. Deenihan asked the Minister for Arts, Sport and Tourism his views on recent statements from leading film producers, carried in media reports in recent weeks, that Ireland is losing its attractiveness to international film production companies due to increased costs and to increased competition abroad; the measures he will take to restore Ireland’s competitiveness as a destination for film production; and if he will make a statement on the matter. [19622/04]
Amharc ar fhreagraI propose to take Questions Nos. 2 and 4 together.
The market for international film finance is global and extremely mobile, with financiers carefully weighing up what competing locations have to offer. Final decisions are usually based on a mix of factors rather than on one particular factor. In this context, I am aware of the concerns expressed by the Irish film industry about the competitive implications of wage costs that are high compared to some competing locations and of the current euro-US dollar exchange rate. However, I am also aware of the positives that Ireland offers, including good locations, qualified and experienced personnel, the fact that English is widely spoken, and a positive approach to the industry by Government.
I am satisfied that the Government has met its responsibilities regarding maintaining the attractiveness of Ireland as a film location. In particular, in his last budget speech the Minister for Finance, Deputy McCreevy, announced that the section 481 tax incentive, which gives tax breaks to those investing in Irish film production, will continue until at least 2008, with the amount that can be raised increasing from €10.48 million to €15 million from 2005.
The Irish Film Board is charged with the development of the Irish film industry and with marketing Ireland as a location for international productions. The board provides a range of supports and assistance to producers and is independent of Government in day-to-day terms. I was able to provide an increase of 10% in the board's funding in 2004. It is up to the industry to address those factors within its control that are considered to render Ireland less attractive for film production.
The newspaper reports that Ireland is being shunned as a production base for major films and that costs have rocketed for those films, which are in production, are of deep concern to us all. Has the Minister had a meeting with the Irish Film Board on this matter? What action has the Minister's Department taken to assure major film industry players that the section 481 tax incentive has been restored and that we want major productions to come here? "Saving Private Ryan", "Braveheart" and films of that scale have been of major benefit to the economy and to employment levels within the industry and among actors and actresses.
What meetings have taken place, what action has the Department taken since the budget and what has the Irish Film Board done since it was given the boost for which the Minister must be congratulated? What has been done to reverse the shunning of Ireland by the major movie giants and production teams?
It is not correct to say the Irish film industry is being shunned. Ireland is an extremely attractive location for incoming film producers and productions. As Deputy Wall pointed out, Ireland has hosted some serious and major films in recent years and I anticipate that we will do the same in the not-too-distant future. While wage costs appear to be a difficulty, the matter must be dealt with by the industry itself. There is very little one can do about exchange rates and the value of the euro against the US dollar. I have no control over fluctuations on the money markets.
The Irish Film Board provides a considerable level of assistance to incoming producers as well as to the indigenous film industry. Its record is very strong. On occasion, I meet the chairman of the board to discuss the future and I have over the last year and more been in regular contact with people involved in the industry generally with a view to advancing the cause of Irish film. The best news the industry has received in many years was the extension of the section 481 relief into 2008 and the increase of the cap to €15 million. These measures are regarded by the industry as the most important lift it has received in a very long time. The industry anticipates and I am confident that the benefits will be seen in the near future.
I am sure the Minister will agree there is cause for serious concern and action. Surely, the fact that no feature film has been shot in Ireland in the first six months of 2004 makes its own statement. There must be a reason for this circumstance. Neil Jordan and Morgan O'Sullivan, two of our most eminent film producers, have said that Ireland is no longer an attractive location in which to make films which highlights the need for corrective action.
Is the Minister aware that New Zealand, Hungary and the Isle of Man have improved upon Ireland's incentives? The global film industry is becoming more competitive while Ireland is being matched by countries many of which have raised the ante to compete for film productions. It is a serious scenario.
When Deputy de Valera was Minister, she established the Kilkenny group which reported in 1999. Developments in film industry work practices and the impact of the rate of exchange constitute only a small part of the problem. Will the Minister revisit the report and perhaps reconvene the group, which previously suggested major solutions to review events in the film industry over the last five years?
While the Minister mentioned section 481, a significant problem has been the uncertainty generated around it over the last year. The wrong signals were sent to the film industry. While the section has been restored, nothing more has happened to incentivise the Irish film industry. We cannot take this serious difficulty lightly. I understand the only major film which will be shot in Ireland this year is the "The Honeymooners" which compares poorly with the level of production of a few years ago.
I disagree with Deputy Deenihan. The outlook for the Irish film industry is bright. The extension of the section 481 relief to 2008 will massively encourage incoming producers. The definite incentive of the increase in the amount which can be raised under the relief from €10.48 million to €15 million from the start of 2005 could not send a stronger signal to the international film community about Ireland's intention to develop the industry and our desire to attract inward investment.
We can only control those things, which are under our remit and maintain the highest standards in those areas in which we have power. We can expect the industry to go from strength to strength. While it is true that concern was expressed about wage costs and the exchange rate between the euro and the US dollar, these are factors over which I have little or no control, unfortunately. Through section 481, we have incentivised like no other Government in the history of the State.
Given its importance to the film industry, will the Minister lead a trade mission to the USA in conjunction with the Irish Film Board to talk to the heavy hitters such as Disney to create interest in Ireland and attract the major players? We have a workforce which is as knowledgeable as any in the world when it comes to producing major films, and actors and actresses who are well able to support international stars. We also have the tax incentives which seem to make the difference. Now is the time to put Ireland back in the film market. What is being done to communicate with the heavy hitters and ensure that Ireland is put back in its rightful place among the main players in film production?
Now that the Irish film industry has been placed on a sound footing with the renewal of section 481 up to 2008 and the increase in the cap on the amount that can be raised from €10.84 million to €15 million from the start of 2005, it is appropriate that we seek to market Ireland on whatever stage we can. In the circumstances, I intend to try to organise a trade mission to the western side of the United States of America with a view to promoting Ireland as a destination for film production. I am anxious to meet the larger production companies to assess their interest in coming here. I will take up Deputy Wall's suggestion and try to move on it soon.
I suggest the Minister speak to the Disney organisation during his visit as it has expressed grave concern about the attitude it found within the Irish industry recently. I remind the Minister that Ardmore is empty at present and the only film of any significance that will be made here this year is "The Honeymooners". Other countries are successfully upping the ante and it is time for the Government to review what others are doing in the international film market.
Will the Minister revisit the Kilkenny report and its recommendations? Will he reconvene that group and seek its advice on the situation and a way forward? Section 481 is not the reason for the demise of our film industry, although it contributed to it. Other factors of which people are not aware have come into play and have not been fully considered by the Minister.
I will not speak of a demise because I do not believe there is one. I would like to watch how the new incentive develops over the coming year. The current section 481 incentive is progressive and competitive. I spoke with people from the Disney organisation during the course of discussions on the renewal of section 481. They impressed on me the need to renew the incentive and to provide certainty. I have done that by extending the provision until 2008 and by increasing the cap on the amount that can be raised. Let us see how this progresses. I expect the Deputy will find it progressive and that we will see a considerable number of major films made in Ireland in the not too distant future.
