Hobbits or handouts? Public sector executives analyse the rise of New Zealand’s screen industry

  • Published Date: 26 February 2019

Handling chainmail and wielding alien machinery falls outside the job descriptions of most senior public servants but analysing the complex relationship between public value and government expenditure, is right in their remit.

An Australia and New Zealand School of Government (ANZSOG) contingent of 67 government officials, from Australia, New Zealand, Hong Kong and Malaysia, recently found themselves doing a bit of both when they immersed themselves in New Zealand’s dynamic screen industry in Wellington.  

Their mission? Discover the challenges facing ‘Wellywood’ and formulate recommendations for ministers, with just two days to research and report.

New Zealand’s screen industry was turbo-charged in the early 2000s by the global success of the Lord of the Rings trilogy. The films spawned a host of post-production, special effects and other high-tech creative businesses in Wellington and around New Zealand.

Big-budget international blockbusters like King Kong, Avatar, Planet of the Apes and The Hobbit showcased the local industry’s talent, while a new generation of local movie-makers took increasingly diverse and sophisticated local stories (Whale Rider, Hunt for the Wilderpeople) to global audiences.

Today, the industry contributes an estimated NZD$1 billion annually to real GDP, another NZD$2 billion in flow-on benefits to sectors such as tourism, transportation and technology, and provides jobs to nearly 14,000 people. The industry has been credited with helping to shape international perceptions of the country and New Zealanders’ own sense of identity.

Are the subsidies worth it?

Despite this success, views on government’s role, and the subsidies it pays to get films made in New Zealand, were divided.

The Ministries for Business Innovation and Employment (MBIE) and for Culture and Heritage (MCH) jointly oversee the New Zealand Screen Production Grant, which offers international and local productions a significant rebate (20-25% for the former, 40% for the latter) on approved costs. The New Zealand Film Commission administers the grant and also, with New Zealand On Air, promotes and supports local film-makers, other content producers and public media. The remits of these two agencies are commercial and cultural, with an emphasis on supporting work with significant New Zealand content.

Many in the industry say they cannot survive without the rebate scheme, due to competition from other jurisdictions, and the tyranny of distance which requires constant investment in innovation to retain a competitive edge.

However, critics slam what they describe as government ‘handouts’. An Opposition politician asked recently, if it was acceptable “that a young couple saving for a mortgage … are paying tax so that Scarlett Johansson … can take home a bigger pay cheque”? 

Others claimed government funding essentially only benefited international productions likely to generate international commercial success and well-established Wellywood companies, at the expense of smaller domestic productions.

Bigger than King Kong

To find out whether the New Zealand government could continue to nurture a sustainable screen industry, while benefiting all citizens, the ANZSOG group met representatives of the screen industry and government agencies including: MBIE, MCH, Treasury, the Film Commission, New Zealand Tourism and the NZ Story Group, experiencing first-hand the ‘can-do’ attitude that has put New Zealand’s screen industry on the global map.

After a whirlwind analysis, the ANZSOG group presented their findings to an expert panel of senior government officials convened by Dame Karen Sewell, analysing the screen industry’s sustainability, distributive equity and cultural identity.

All participants supported the incentive scheme, with some suggesting simplification, expansion and an increase in government agency coordination.

They urged Government to partner with industry to develop a bold long-term sector strategy, encompassing skills training, R&D and ways to encourage more local content. More robust evidence about the economic and other benefits generated by the screen sector was needed too, as recent industry reviews had highlighted.

Some groups said Treasury’s new Living Standards Framework – an analysis and measurement tool that will underpin Budget 2019 and includes cultural identity as one test of wellbeing ­– offered government an opportunity to shift public misconceptions about its investment in the screen industry.

Several non-New Zealand members of the contingent noted how Māori cultural values and language positively informed social policy and public life; others on the comparative transparency of government processes and citizen engagement.

The benefits of immersion

The deep-dive into Wellywood, provided the ANZSOG group with an opportunity to expand their leadership and problem-solving skills while gaining real-world insights.

Robin Ryde, Executive Fellows Program (EFP) co-director, leadership and organisational development expert, and former CEO of the UK National School of Government, said the immersive exercise provided participants with the unique chance to grapple with a “live, messy issue”.

“It’s an exercise in figuring out what to do when you don’t know what to do,” he said.

Associate Professor Catherine Althaus, EFP co-director and ANZSOG Deputy Dean, said the exercise forced participants to “engage very rapidly with areas outside their expertise”.

“They are challenged to generate creative ideas for maximising public value – skills that public sector leaders need every day,” she said.

Rebecca Smith, Director of NZ Story, said the participants had been “cohesive, probing and blunt” in their examination.   

New Zealand agencies will have the opportunity to examine the groups’ recommendations.

The challenge formed a crucial component of ANZSOG’s 2018 Executive Fellows Program - an intensive leadership program for senior executives spanning three countries in three weeks (New Zealand, Australia and Singapore).

Find out more about ANZSOG’s Executive Fellows Program