Telefilm

Action

Plan

despite efforts at Telefilm Canada to handle increasing government cuts without damaging the country’s distribution and production industries, the writing is on the wall. ‘The future is daunting,’ said director of operations Bill House at a press conference May 22 announcing this year’s Action Plan.

Telefilm’s Action Plan last spring, which incorporated a $6 million cut, left each of the agency’s three major funds (broadcast, distribution and feature film) untouched.

The good news this year is despite a cumulative $12.6 million cut at Telefilm in fiscal 1995/96, each of the funds is being cut by a mere 1.9%.

Next year, however, looks grim. Telefilm executive director Francois Macerola says he has heard from sources in Ottawa – including the prime minister’s office – that the agency should expect cuts of 15% next year and 10% the following year. ‘Difficult and drastic decisions’ will be have to made next year, he said.

At the press gathering, Macerola said it was time for ‘a re-engineering’ of the agency and vowed that ‘every single dollar spent at Telefilm Canada’ will be analyzed.

Telefilm’s budget this year is $146.4 million, down $4.4 million from last year. The parliamentary allocation is $109.8 million. Although cuts from Parliament came through at $8.2 million more than the agency’s overall budget reduction, losses have been offset by anticipated revenues of $23.6 million – up from $20 million in 1994 – and a $13 million carry-over from last year, up from $8.5 million in fiscal 1994/95.

This year’s strategies include the launch of a new media program by September, reviews of recoupment programs for distribution, marketing and commercial production as well as a reduction in festival participation. A re-evaluation of the feature film industry – to improve production values and expand distribution opportunities – is on the table as is what Macerola calls the agency’s ‘social and cultural contract with broadcasters.’

Some Action Plan highlights are:

– Savings at the agency will be culled from cuts to the three principal funds, a 10% cut to auxiliary programs, and a 6.9% administration cut representing $1.2 million and the loss of 12.5 person years.

– Cuts of 1.9% to the $65 million Broadcast Fund, the $13 million Distribution Fund and the $24.5 million Feature Film Fund will represent savings of $1.7 million in total.

– Certain development phases in the Broadcast Fund have been terminated and broadcasters are now required to invest 20% of development costs in a project.

– Because there is an increasing number of producers who are also broadcasters, Telefilm is investigating policies regarding eligibility in this area. In addition, a licence commitment from a specialty service is not enough; a producer must also have a commitment from a conventional broadcaster.

– Telefilm’s Los Angeles and London, Eng. offices will close within two months. Each office costs approximately $150,000 annually to run. In place of the London operation, Macerola talked of opening a European office with two or three agents who would represent a number of markets.

Also gone is the program to assist in the foreign launch of a production.

– The Loan Guarantee Program, as promised last April, is up and running with a $25 million allocation. The aim is to stimulate activities between production and financial sectors. Telefilm will guarantee up to 85% of a borrower’s financial commitments, which must be between $50,000 and $1 million.

– The Special Production Fund has been renamed the Commercial Production Fund. The terms of the fund remain the same.

– Plans are to develop more coproduction activity including an investigation into exploiting the South American and Asian markets.

At the press conference, Macerola shared his views on many cultural imperatives. In response to a speech recently delivered by Quebec Premier Jacques Parizeau – which some have interpreted as heralding the end of provincial funding for English-language productions in Quebec – Macerola said he would over-step the agency’s policy of equal-access funding to make sure such films are made. ‘For cultural reasons, we will have to increase our participation in these films.’

On the contentious issue of interprovincial relations, the agency head commented that doing business with foreign countries is easier than doing business at home between provinces. ‘I think the provinces should be completely open to cultural free trade,’ he added.

He also quoted Pierre Juneau (head of the triumvirate that will review the mandates of the cbc, Telefilm and the National Film Board) as saying the national agency should serve both cultural and commercial mandates. ‘For me, we’re strictly there for culture,’ he said, while acknowledging that commercial impetus has its place.

One area where commercial strategies are working, according to Shane Kinnear, director of distribution and marketing, is with the recoupment program announced by Telefilm last year.

The plan, which is being implemented over three years, is aimed at ensuring that distributors who access the Distribution Fund (for releasing Canadian films) are accountable at the box office.

‘It’s had a positive effect, we’ve seen a real change,’ says Kinnear.

An ‘acknowledgment’ has been implemented for distributors who pull in more than $100,000 and no less than $40,000 at the box office for an English-language film, thereby rewarding distributors with an increase in their envelope if they hit these targets.

Macerola spent considerable time at the conference defending the agency’s much-criticized $350,000 presence at this year’s Cannes Film Festival, attended by 16 Telefilm representatives, including the chairman and vice-chairman. He said Telefilm’s presence at the mip-tv and mipcom will be re-evaluated but asserted the Cannes festival ranks as an important cultural presence for the agency.

Nonetheless, House is heading up a task force that asks members of the industry to evaluate Telefilm’s presence at international markets. Roger Frappier of Max Films, Montreal, and Bravo!’s Paul Gratton will also sit on the committee. Macerola says a report is expected on his desk by September.

At home, Telefilm’s participation in film and video festivals is being severely cut back over the next three years, from subsidizing 25 to 35 festivals across the country to six. The savings will be approximately $600,000.

The Toronto International Film Festival, the Montreal World Festival, the Banff Television Festival, the Vancouver International Film Festival, Moncton’s Festival du Cinema Francophone and the Atlantic Film Festival will have continued access to Telefilm funds.

Macerola is aware these cutbacks to Canadian festivals will not be popular, and while he hopes for some ‘elegant solutions,’ he says not many exceptions will be made to the new policy.

In times of fiscal restraint, Macerola showed some real enthusiasm for finding alternative means of subsidizing the film and tv industries, including the idea of ‘inviting the Americans to make a contribution’ based on revenues generated through distribution and exhibition in Canada. With some hesitation, he referred to the concept as a tax and says he has discussed the matter with Heritage Minister Michel Dupuy. The process that might put such a subsidy in place is at the earliest of stages, he added.

Telefilm’s proposal to the federal government to administer the new tax credit is currently under review. Word from the government on this matter is expected by mid-June.