Following Canadian federal audiovisual agency Telefilm Canada’s decision to slash its funds for theatrical documentary production from CDN$1 million to $500,000, the president of the Director’s Guild of Canada has warned that the move is “the wrong message to send.”

The decision is part of a plan to reduce costs by $2.7 million for 2012 after the Canadian government introduced austerity measures that will see  $10.6 million cut from the agency’s coffers over three years.

Telefilm will also reduce development financing by $700,000, and promotion and training programs by $500,000.

“Canada is celebrated for its achievements in documentary film making,” said DGC president and award-winning filmmaker Sturla Gunnarsson in a statement.

“This single drastic cut to a program that has been a major success feels like the wrong message to send,” he added.

“We sympathize with Telefilm Canada’s financing predicament,” added Gerry Barr, DGC’s national CEO and executive director, in a statement.

“But support for documentary filmmaking is hard to come by in Canada and this program has been a key part of the package. It’s difficult to imagine that boundary breaking documentaries can continue to be made with funds solely through donations and private sector partnerships,” he said.

Since 2007, the Telefilm Canada/Rogers Group of Funds’ Theatrical Documentary Program has supported Canadian docs such as Lixin Fan’s Last Train Home, Neil Diamond’s Reel Injun, and Isabelle Lavigne and Stéphane Thibault’s La nuit, ells dansent.