Below is a statement I have sent to the European Commission which will be making a decision on film subsidies in Europe.
To: The European Commission
Recently your group has made a proposal to change policy regarding film subsidies. You encouraged the public for consultation on the matter and I would appreciate it if you took the time to read my statement.
I’m an anonymous visual effects professional from California. As you may be aware, the Hollywood film industry has been greatly injured by international and state subsidies offered to the big six studios: Warner Bros., Disney, Paramount, Fox, Sony, and Universal.
I am writing to you in the hopes that you will bring an end to the zero-sum game that is the international film subsidy race. I strongly feel that you should not only end them in Europe which US studios are taking advantage of, but also challenging subsidies in other countries (including the US) through the WTO. This would help level the playing field and remove the barrier to market economics which your organization has a responsibility to achieve.
Subsidies have made the VFX business more volatile than it has ever been before. They artificialize the price of VFX for producers and lead to a race to the bottom which I have written about on my blog for over the last 2 years. While I have seen them take a toll on the facilities we work for, I have also seen them take a toll on the people I work with.
Family members are coerced to separate as spouses must globe-trot around the world chasing work because a certain project needs to be made in a subsidized region. Some even have lost their homes as they are unable to maintain mortgage payments while paying rent in the subsidized region where they are working. For many others the prospect of maintaining a career in this industry is nullified. No matter how talented we are, no matter how efficient we are, we are at the mercy of the next government to come along that offers millions of dollars to producers looking to take advantage of free money.
However it’s not just the workers that are just realizing these problems. Even big Hollywood producers and directors recognize this. Producer Gavin Polone recently wrote:
They’re bad economics, they don’t make a film better … and they’re a misuse of public funds
Producer and Director Matthew Vaughn also wrote:
Success or failure was irrelevant because investors simply received a tax deferral, to be paid back over the life of the film lease irrespective of film performance, while the producer used his benefit from the transaction to defray the cost of production. It was a purely financial arrangement which did not achieve the policy aim of creating a sustainable business.
The subsidy race has quickly turned into a war where various regions are trying to undercut each other and US studios are happily taking advantage of it.
While the UK offers generous subsidies for the film industry, others have asked to join the race. UK-based Aardman Animation has said if the UK does not offer subsidies, they would move productions to Germany which offers tv animation subsidies. The UK games industry also made similar pleas.
Recently, the European Commission ruled that Spain must pay back over $US 345 million because their film subsidies distort competition between other European countries. It’s been suspected the complainant was a UK film studio. If this is true, it begs the question: How does the EC determine which set of members get to keep film subsidies and which members must get rid of them?. It’s clear that this is a subsidy race and it is the responsibility of the European Commission to stop it.