FILM & TV PRODUCTION OFFSETS BOOST AUSTRALIAN ECONOMY BY $16.5 BILLION, OLSBERG SPI STUDY SAYS
SPENDING ON AUSTRALIAN PRODUCTIONS HIT A RECORD A$2.2 BILLION IN 2021/22,
UP 91% OVER THE FOUR YEARS STUDIED
AUSTRALIA’S LOCATION INCENTIVE A KEY MAGNET FOR BIG-BUDGET FOREIGN PRODUCTIONS
MONDAY 13 FEBRUARY, 2023 (AEDT)
CANBERRA – A new economic impact assessment of film and television production incentives has found that the Australian government’s production offset programs deliver a high level of return on investment. The report also finds that offset programs underpin Australia’s global standing as a leading production hub among countries where governments have recognised the sector’s economic and cultural benefits.
Australia’s Location Offset, for example, which is critical to attracting major offshore film and television productions to the country, equated to $5.89 return for every $1 invested through the program; The estimated amount of production expenditure associated with all the production offsets contributed a total of A$16.5 billion in economic output over the four years to FY2021/22.
According to Olsberg SPI, since the introduction of the Offsets, total production expenditure in Australia grew to more than A$2.2 billion in 2021/22, up 91% over the four years studied.
The Study on the Impact of Film and Television Production Incentives in Australia by Olsberg SPI was launched today by the Australia New Zealand Screen Association (ANZSA) and the Motion Picture Association (MPA) at an event at Parliament House in Canberra.
Presenting the key findings of the report, Jonathan Olsberg – Chairman, Oslberg SPI, said, “Our study into the impact of Australia’s film and television Offsets found that Australia’s Screen production industry is a thriving economic sector, supported by a suite of effective initiatives in the form of the PDV Offset, Producer Offset and the Location Offset and Incentive. The study provides further evidence that Australia’s system of screen production Offsets helps deliver economic impact on a consistent basis.”
Schuyler Weiss, Managing Director, Producer, Bazmark, said, “The Producer Offset allows Australia’s storytellers to turn an idea into reality, and this report shows that even purely on economic grounds that’s a good deal for Australia, with $4.40 in economic value generated for every $1 spent on the Producer Offset reaching far beyond the screen sector alone.”
Leading the panel discussion was Partner & Producer, SERVO Production Services, Jon Kuyper, who supervised major productions in Australia including The Great Gatsby, Mad Max: Fury Road, Gods of Egypt and more recently produced Thirteen Lives and Woody Woodpecker. Kuyper said, “Australia’s combination of attractive incentives, world class crews and facilities, and magical locations mark it as a global best-in-class for inbound production. However it’s vital that we see some certainty around the location offset if the country is to achieve its full potential as one of the world’s leading production hubs.”
The industry that created blockbusters including Thor: Love and Thunder, Guardians of the Galaxy, Mortal Kombat and most recently Nautilus, The Fall Guy, Kingdom of the Planet of the Apes and Metropolis is set to add three new studio facilities across WA, NSW and QLD in the near future. It’s all part of a broader boom across Australia’s screen industry, buoyed by a A$400 million boost to the Location Incentive rolled out in 2020. The production pipeline is growing at a record rate, feeding a surge in demand for a further top-up, extension or reform of the Location Incentive to simplify the reliefs in line with competitor countries, such as the UK, and continue to boost growth in the sector.
Joining Kuyper on the panel was Kate Marks (Ausfilm CEO), Luke Hetherington (Industrial Light & Magic (ILM) Executive in Charge), Schuyler Weiss (Bazmark Managing Director) and unit production manager, Jen Cornwell (Thor: Ragnarok; Kong: Skull Island; Pirates of the Caribbean: Dead Men Tell No Tales).
Marks said: “International productions play a crucial role alongside Australia’s domestic productions in growing Australia’s entire screen ecosystem. They are vital to skills and infrastructure development, offer significant jobs and training opportunities and enable access to the latest technology developments. A permanent 30% Location Offset would ensure a consistent pipeline of both physical production and PDV activity and cement Australia’s position as a leader in the global screen industry.”
Cornwell pointed to the multiple benefits that flow from hosting big footloose productions to Australia: “These movies are the lifeblood of many of Australia’s gold class crews. They help to pay mortgages and put food on the table,” she said. “The scale of these productions means that many of the crew improve their skills, are able to obtain the most up-todate film equipment and increase their worth in the industry ecosystem. In turn, these professionals transfer their newly acquired skills to work on local films and television shows, increasing the overall quality of Australian production. Many of these international productions offer thoughtful career pathways for individuals at the early stage of their screen industry career.”
Extolling the virtues of the 30% PDV Offset, Hetherington said, “The long-term reliability of the federal PDV Offset created a solid foundation for local companies to seriously invest in skills development and infrastructure to deliver world class services, and to enable people in Australia to build long term careers in this sector. It’s been a great model.”
Key findings from the Study on the Impact of Film and Television Production Incentives in Australia include:
Since the introduction of the Offsets, expenditure in Australia has grown, culminating in A$2.1 billion in total production expenditure in 2021/22. There has been an annual growth rate of 17% in direct expenditure across the three Offsets between 2018/19 and 2021/22.
This screen production expenditure has translated into economic value. Between 2018/19 and 2021/22, all the Offsets expenditure in Australia has contributed a total of A$16.5 billion in economic output.
Research for the report shows that without the Offsets a lot of the production activity would not take place in Australia. The response to a survey of 10 large international production companies, which together were responsible for nearly 90% foreign production expenditure between 2018/19 and 2021/22, indicates that all international productions would have either moved outside of Australia or not happened at all without the Location Incentive.
The ROI metric for the three Offsets ranges from 4.40 for the Producer Offset to 5.89 for the Location Offset.
Over the four years studied, Offset-supported productions expenditure grew by 91%, Gross Value Added (GVA) generated from these productions grew by 92%, tax revenue generated grew by 91% and full-time-equivalent (FTE) jobs by 76%.
Between 2018/19 and 2021/22 total GVA across the three Offsets amounted to A$5.9 billion.
In 2021/22, 20,600 FTE jobs have been supported across the three Offsets.
For more information or to read the full report, visit anzsa.film/
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Australia New Zealand Screen Association (ANZSA) represents the film and television content and distribution industry in Australia and New Zealand. Its core mission is to advance the business and art of filmmaking, increasing its enjoyment around the world and to support, protect and promote the safe and legal consumption of movie and TV content across all platforms. This is achieved through education, public awareness and research programs, to highlight to movie fans the importance and benefits of content protection. ANZSA works on promoting and protecting the creative works of its members. Members include: Village Roadshow Limited; Motion Picture Association; Walt Disney Studios Motion Pictures; Netflix Inc.; Paramount Pictures; Sony Pictures Releasing International Corporation; Universal International Films, Inc.; and Warner Bros. Pictures International, a division of Warner Bros. Pictures Inc., and Fetch TV.
More information can be found at https://anzsa.film/who-we-are/
ABOUT MOTION PICTURE ASSOCIATION (MPA) Asia Pacific
The Motion Picture Association (MPA) Asia Pacific represents the interests of the six international producers and distributors of filmed entertainment. To do so, they promote and protect the intellectual property rights of these companies and conduct public awareness programs to highlight to movie fans around the world the importance of content protection. These activities have helped to transform entire markets benefiting film and television industries in each country including foreign and local filmmakers alike. The organization act on behalf of the members of the Motion Picture Association, Inc (MPA) which include: Walt Disney Studios Motion Pictures, Netflix Studios, LLC, Paramount Pictures Corporation, Sony Pictures Entertainment Inc., Universal City Studios LLC, and Warner Bros. Entertainment Inc. The MPA has worldwide operations which are directed from their head offices in Los Angeles and Washington, D.C. and overseen in the Asia Pacific by a team based in Singapore. For more information about MPA Asia Pacific, please visit www.mpa-apac.org and https://www.facebook.com/mpaasiapacific/.
ABOUT OLSBERG SPI
Olsberg SPI is a UK based, specialist, creative industries consultancy that provides expert consultancy and strategic advisory services to global public and private sector clients in the worlds of film, television, video games and digital media. Formed in 1992, it has become perhaps the leading international specialist consultancy in this industry.
For its public sector clients, SPI understands how the fast-growing creative industries compete in international terms; how important it is to develop indigenous industries focussed on growth, particularly export, and how screen-based creative industries are a major driver of economic activity.
SPI’s commercial clients operate at all points along the digital media value chain and SPI is an expert in robust research and analysis, developing corporate strategies, advising on business development strategies and understanding how changes in digital technology are affecting business models in these areas. For more information about Olsberg SPI go to https://www.o-spi.com/about
 Drama Report 2021-22. Screen Australia, 10th November 2022. Accessible at: https://www.screenaustralia.gov.au/getmedia/3a8f3011-211c-4f93-bd41-3b4767585dec/SA-DramaReport.pdf