Valerie Creighton had an advantage while this week acting as an emissary between Saskatchewan’s Grinch-like premier Brad Wall and a Canadian industry left dumbfounded by his decision to cancel his province’s film tax credit.

The Canada Media Fund CEO hails from Saskatchewan, stills runs a ranch there, and so speaks the language of a province that has long struck pragmatic and inventive solutions to thorny public policy issues.

Saskatchewan, Creighton proudly points out, virtually created Canada’s medicare system.

That makes her the perfect heartland foil to the industry establishment in Toronto and Ottawa now asking whether Wall and his pragmatic conservatives are blind in seeing how the Saskatchewan tax credit pays for itself six times over, or are just out to kneecap local filmmakers for ideological reasons.

Neither is the case, Creighton insisted Thursday.

“The premier was sincere in wanting to do something to assist the industry,” she told Playback Daily following her meeting with Wall on Monday.

The province earlier in the week extended the Saskatchewan Film Employment Tax Credit by three months to June 30 to give local producers time for projects currently in the pipeline to qualify under the program.

That should ensure a production season for Saskatchewan through 2012.

News of the film tax credit extension was widely greeted as a sign that the threatened shutdown of the Saskatchewan production sector had been averted, at least for now.

“We hope that this extension can act as a bridging opportunity for industry and government. The industry needs an alternative, one that will continue screen-based production in Saskatchewan,” Gerry Barr, national executive director and CEO of the Directors Guild of Canada, said Thursday.

But Wall still wants no part of the current provincial film tax credit, which he sees as a subsidy merry-go-round propelled by, and to the profit of, people who travel to Saskatoon or Regina to shoot films and TV shows, get paid, and then go home and pay taxes in their own province.

On Monday, after meeting an industry delegation that included Creighton and CMPA topper Norm Bolen, Wall told reporters he wanted to see a “real” tax incentive.

“As you make an investment, we will provide you a credit on taxes you pay in the province. In other words, you conduct your activities here, you make some money here, and so you owe taxes to the province,” he explained.

As the leader of a resource-rich province dependent on oil and potash for its economic stability, Wall is well-versed in the economics of commodity extraction and removal.

Even as Canadian producers point to the spin-off benefits of equipment rentals, and hotel and restaurant expenditures when films and TV series are shot in Saskatchewan, Wall wants to keep more of that money, and industry control, in the province.

“They want to be clear about what they put in and what they get out,” Creighton explained.

And much has been made about Saskatchewan spending $100 million on its film tax credit since 1998, while reaping around $623 million in local jobs and spin-off benefits.

The Saskatchewan Motion Picture Industry Association estimates 74% of that $623 million is new money from outside the province, and spent locally.

And sweetening their own film tax credits to keep one jump ahead of rival locales is just something rival Canadian provinces have learned to live with.

But Wall doesn’t like that subsidy math.

He told the Canadian industry delegation Monday that around $100 million went into film tax credits, but another $100 million has gone into building and subsidizing the Canada-Saskatchewan Soundstage in Regina managed by SaskFilm.

“That’s a 30% subsidy and that’s too high for him,” Creighton said of Wall’s film support calculations.

All of which has the Canadian industry facing a conundrum as Saskatchewan inches towards a replacement for its cancelled film tax credit.

Creighton is confident the province will find a way to support and sustain its film and TV sector.

“There’s a lot of hard work ahead. But I’m optimistic that the Saskatchewan people are incredibly inventive and have a genius in terms of solving policy problems,” she argued.

But the prairie province has also signaled that it no longer wants to be competitive in bringing foreign producers to shoot in Canada.

And that’s sending the wrong signal back to Hollywood when Canada has long been seen as a reliable foreign location owing to a simple and predictable tax regime.

“The Saskatchewan government decision has put that in jeopardy. It’s created uncertainty in Los Angeles,” Stephen Waddell, national executive director of ACTRA, the performers union, said Thursday.

It all recalls federal industry minister Tony Clement in late 2010 pleading Canada was still open to foreign investment after mining giant BHP Billiton withdrew its hostile $38.6-billion offer for Saskatchewan’s Potash Corp. because it could not pass Ottawa’s takeover test.

Saskatchewan now cancelling its tax credit is a blow to a Canadian film, TV and digital industry that has been at times smug, making grand plans, considering itself the belle of the ball as Hollywood and foreign producers shoot in Canada, or partner with Canadians on international co-productions.

Thanks to generous tax credits and other financial subsidies, foreign location shooting in Vancouver, Toronto and Montreal has been strong heading into the key spring and summer 2012 shooting seasons.

Now Saskatchewan has shaken that confidence by signaling to rival provinces and Hollywood that it doesn’t want to be competitive.

And Wall has confounded the industry by actually standing up and giving voice – within earshot of Hollywood – to criticism that the cost-benefit analysis of film tax credits may not be as favourable to provinces as supporters claim.

More worrying, Saskatchewan can’t go it alone on its incentives for local film and TV production.

Federal structural supports for the industry are set up to ensure taxpayer coin is spread across the country, not just to Montreal and Toronto.

There are two TV series from Saskatchewan producers now in the pipeline, including a potential CBC series from Bob Crowe’s Angel Entertainment, that could be dashed if Wall’s pragmatic Conservatives do not produce a replacement incentive producers can take to the bank.

“Whatever is finally arrived at as a solution has to be bankable and workable for the industry, it has to have the support of the government,” Creighton said of current negotiations in Regina to untie the Gordian Knot that is Saskatchewan.