Change local content rules, says govt inquiry.

  • Local content quotas on SVOD services recommended
  • Remove 65 episode cap on Drama
  • Children’s content reforms
  • Close NZ content loophole
  • “First release” = anywhere in the world
  • Minimum children’s quota for ABC
  • Minimum 50% local content on SBS
  • More regional production

Sweeping industry changes have been recommended by the inquiry into the Australian film and television industry.

If implemented they will impact public, commercial and subscription broadcasters, including SVOD services, as well as production companies and ultimately the viewing public.

Here are the recommendations:

Tax incentives for screen production
Recommendation 1
The committee recommends that the Australian Government makes the following changes to the producer offset:
 Introduce a single offset level of 30 per cent for all types of qualifying production, which includes film and television. This will remove the distinction between theatrical and non-theatrical features.
 Remove the 65 hour cap on television series accessing the offset.

Recommendation 2
The committee recommends that the Australian Government makes the following changes to the location and post, digital and visual effects (PDV) offsets:
 Increase the location offset to an internationally competitive level of 30 per cent. This will eliminate the need for top-up grants and provide more financial certainty to overseas production companies considering Australia as a destination.
 Decouple the location and PDV offsets so that both can potentially be claimed for the same production.
 Provide in the legislation that productions commissioned for any content platform will be eligible for the location and PDV offsets if qualifying Australian production expenditure (QAPE) requirements are met.
 Reduce the minimum QAPE threshold for the location offset to $5 million specifically for pilot features.

Recommendation 3
The committee recommends that any future reforms to Australia’s content quota system ensure that commercial and subscription television companies continue to invest in and broadcast Australian programs for general audiences at current levels. In addition, the new quota system should provide that subscription video on demand services invest a percentage of the revenues they earn in Australia, for example 10 per cent, in new Australian content.

Recommendation 4
The committee recommends that the children’s content sub-quotas be reformed in light of current viewing trends but continue to ensure access to a variety of quality Australian content for children, particularly live action drama, across all platforms.

Recommendation 5
The committee recommends that the Australian Government reviews the hours-based quota for first release children’s screen content and considers replacing some or all of this quota obligation with a contestable fund to support the creation of quality Australian children’s programsinto the future.

Recommendation 6
The committee recommends that first-release be redefined to mean first broadcast anywhere in the world.

Recommendation 7
The committee recommends that the charter for the Australian Broadcasting Corporation be amended to require a minimum hours based quota for first release children’s screen content. This reflects the ABC’s strong commitment to children’s television and community feedback indicating that the ABC has become the primary provider of Australian programming for children.

Recommendation 8
The committee recommends that the Special Broadcasting Service Corporation charter be amended to require additional multicultural programming to be sourced domestically so that a minimum of 50 per cent Australian content is shown across all of its channels. This must also include a commitment to more content from regional areas.

Other issues in Australia’s screen industry
Recommendation 9
The committee recommends that 10 per cent of Screen Australia’s funding be earmarked for productions outside of Australia’s two major capitals. The rules governing this regional funding allocation should stipulate that the production:
 must conduct its principal photography in a town, small city or area that lies beyond metropolitan Sydney or Melbourne; and
 does not need to meet significant Australian content rules but must satisfy the same QAPE threshold requirements as the producer offset and must employ a majority of Australians.
Screen Australia must also provide a regional breakdown in its annual report of the productions it has funded.

Recommendation 10
The committee recommends that the Interactive Games Fund be reinstated.

Recommendation 11
The committee recommends that the Australian Government expands the current co-production program by negotiating agreements with additional Asian countries.

Recommendation 12
The committee recommends that the Australian Government amend the Foreign Actor Certification Scheme to remove the obligation for union consultation.

Recommendation 13
The committee recommends that the Minister for Small Business discuss mental health and other occupational health and safety issues with small businesses in Australia’s entertainment industry and consult on ways to address these concerns into the future.

Screen Producers CEO, Matthew Deaner, said there were many recommendations which would support small to medium-sized Australian production businesses.

“The Report made 13 recommendations relating to modernising and harmonising the producer, PDV and location offsets; local content obligations on SVOD services, the ABC and SBS; reform of the children’s quotas and a contestable fund for children’s content; a regional emphasis for Screen Australia funding; more and better co-production agreements with our Asian neighbours; introducing flexibility to the Foreign Actor Certification Scheme; closing the New Zealand content loophole; and a greater emphasis on mental health and wellbeing in the industry.

“SPA provided the Committee with a forward-thinking, positive policy agenda focussed on increased trade, which has largely been adopted by the Committee. Our industry’s policy settings on tax, local content quotas, Screen Australia and co-production treaties have served us well and got us to where we are now. But if we are to grow the industry and compete better in the global marketplace, we need to better equip our small to medium-sized production businesses. The Committee has delivered a report that sets out an updated policy framework which will empower Australian production businesses to compete internationally for ideas, finance and talent, including long-overdue, sensible and sober reform of the Foreign Actor Certification Scheme, which will benefit the entire industry.

“One concern I have with the recommendations is the proposed reduction in tax offset for feature films from 40 to 30 per cent. There are many existing challenges for our talented film makers in today’s competitive global landscape and to put things simply, this proposal will mean great Australian feature films will struggle to get made. SPA has made this clear in our submission to the Government in the Australian and Children’s Content Review and we will continue to advocate for features films not be marginalised in any policy reforms and ensure great Australian productions like Lion, The Sapphires, The Dressmaker and Sweet Country be able to be made and shown to audiences both home and abroad.”

“I am delighted to see the Committee has recommended SVOD services, that generated significant revenue from our market, contribute something to the local industry – up to 10 per cent of revenue earned. Following Europe and Canada, I am convinced it is a just a matter of time for Australia to catch up.”

“We know the commercial broadcasters want their obligations to Australian children abolished. The Committee has conducted some valuable thinking around addressing Australian children’s content. The Committee has made sensible recommendations to reform both demand and supply-side policies to ensure continuing supply of a variety of quality Australian content across multiple platforms. SPA will continue to advocate to #savekidstv.”

You can read the report in further detail here.

9 Comments:

  1. Children are not small adults. The idea that we should be subsiding a large amount of TV just so that children have a wide choice of crap full of ads, is just crazy. There’s a reason why the majority of video viewing by children is not on commercial TV and this trend is increasing exponentially. There is a strong inverse correlation between the amount of TV a child watches and their language skills, education results and lifetime earnings. Putting the ABC on quota to show quality preschool and kids TV, with a reasonable amount being made by them is all that is needed.

  2. At first glance:
    Local content quotas on SVOD….never happen.
    Close NZ content loophole…won’t get past trade agreements.
    Children’s content reforms…give more taxpayer funds/tax deductions to Commercial TV.
    Minimum 50% local content on SBS…fill the schedule with reality and game shows.
    More regional production…more taxpayer subsidies to commercial enterprises.
    Hopefully, these “sweeping industry changes” will be swept under the carpet.

    • It is no a loop hole that the quota’s don’t apply to SVOD. The ACMA is charged with regulating licenced broadcasting and is specifically excluded from regulating the internet, otherwise you have to police every website, blog and chat room. You can apply quotas to SVOD. Several European countries do it, but it would require separate legislation targeting the SVOD providers specifically. And if wouldn’t apply to youTube or Facebook.

  3. 50% local content for a multicultural broadcaster doesn’t really make sense, then sbs detractors will say sbs is not meeting it charter with so much English language content.

      • Probably – handing over responsibility for transmission to SBS directly and then taking the funds that used to be used to fund transmission and ‘gifting’ it to SBS and painting it as a funding increase to SBS.

        Whoops. They’ve (the Libs) already done that one. I wonder what flim flam pseudo funding increase they’ll come up with next.

      • That’s predicated on the (probably mistaken, or at least overly optimistic) belief that increased funding would be forthcoming.

        And that nobody would notice that SBS is no longer fulfilling its charter, or that the other commercials wouldn’t complain about a “taxpayer-funded” competitor being given “special treatment”, or [insert any one of dozens of other specious complaints that could be made]…

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