The Rebate State

While Government rebates are very important when it comes to attracting foreign film spending, Tim Riley reminds us that money is not the only reason that projects are shot somewhere.

The recent decision by the Government to increase our production rebate to 20% got me thinking about Fiji. A year or two ago I was in Fiji on my honeymoon. With my wife. In between drinking cocktails at the swim-up bar I carried out research into the state of Fijian television. I discovered there are two local stations, one of which (Fiji Super) only plays super 14 rugby, and the other (Fiji One) which carries a nightly news show, various badly produced documentary style programmes and content from ABC. I don’t know if Shortland Street is still on TV there, but I do know that the locals love it.

During the week I caught up with my friend Aiyaz Sayed-Khaiyum, who is the Attorney General (and according to Ratu Mara the real power behind the throne). We met in the lobby of the Sheraton Denarau. Aiyaz had two bodyguards who he introduced me to. They seemed like nice guys. Quite large though. I asked Aiyaz about the state of the film and television industry in Fiji, as it seemed like a safe topic. Coincidentally, Aiyaz’ brother Riyaz (known to some here from his time as a reporter at Asia Downunder) was recently appointed as the head of the Fiji Broadcasting Corporation.

Aiyaz said that Riyaz was carrying out some much-needed reforms in the broadcasting sector and was also looking at developing television production as part of the FBC (currently it just produces radio). Certainly, unless you have a particular fondness for blurry clips of ceremonial road openings and the like, there is some potential for development in this area.

On the topic of film, Aiyaz informed me that they were going all out to attract Bollywood productions to Fiji and had recently secured a project with a $10 million budget. (I didn’t want to prick Aiyaz’ bubble by telling him that as we found out with Players, having a decent budget still doesn’t guarantee they will pay their bills). I asked Aiyaz whether the Fiji Government offered a production spend rebate. At that time we had just been through The Hobbit debacle which put a lot of focus on our 15% rebate, and of course our Government has now made the decision to increase our rate to 20% (or 25% if you meet certain, as yet undefined, criteria). Guess what Fiji offers? More than double our standard rate. 47% is the production rebate provided by the Fiji government to foreign productions carried out on Fiji soil. Of course, size isn’t everything when it comes to rebates. The main problem when a production arrives in Fiji will be finding skilled crews and studio facilities. Sure, you can get great location shots. But it is not all about the scenery either. Given the state of the infrastructure, including the roads, mounting a film production in Fiji is not going to be easy.

I don’t know if there is a maximum budget threshold beyond which the rebate doesn’t apply. I wonder what Cast Away cost for example. Actually, I just checked IMDb. It was $90 million. Not sure how much of that related to the Fiji shoot though. Let’s say it was half. A rebate of around USD$20 million would be a pretty big hit on the public coffers of a country like Fiji I imagine. But maybe they have a pay through deal with the Chinese.

I guess the point I am trying to make is that you can’t just offer more money to film producers and expect them to come flocking on that basis alone. And I think the corollary applies too. In a country like NZ, the rebate, while important, is clearly only part of the story. We also offer a resident population of highly-skilled, mobile, and hungry film workers. We have composers, writers, and other creatives of all colours in abundance. We have world-class studio and post facilities. We have great infrastructure, including transport, finance, and telecommunications. We have some really good film lawyers… And of course everything is moderated by exchange rates. If there is an adverse movement of the local currency against the currency of the film financiers, it may not really matter what the rebate is.

That is not to say the rebate is not important. It clearly is. And there is certainly a more optimistic mood around since the change in policy was announced. I just think it is important for us all to remember that money is not the only reason projects come here.