It’s been a little over two years since the Government of Saskatchewan took the local film industry out in one of the province’s ample canola fields and gave it a double tap to the back of the head in the form of ending the Saskatchewan Film Employment Tax Credit program (SFETC). The purpose of the program was to encourage the film industry in Saskatchewan by providing a tax credit of up to 55 per cent of the labour costs in film and video productions conducted in province. Numerous movies and TV series benefitted from the program including Corner Gas and Little Mosque on the Prairie.
The reason the program ended came down to straight up dollars and cents, certainly not sense. The provincial government decided the return was definitively not big enough to justify the expense and began the process of ending it to “save” between $3 million and $8 million per year. Reports seem to vary on the exact number but $8 million is the most common.
Shockingly, those who worked in the film and TV production industry collectively freaked the hell out. Their concerns were simple, that the loss of the credit would drive business, jobs, and skilled workers out of the province to provinces with credits and thriving media production industries. And when you consider the fact that such tax credits are common across North America, they are valid and correct concerns.
Premiere Wall’s response to this outrage was that he wouldn’t consider changing his mind on the end of the SFETC but would consider other programs to provide real incentives to producers. This included increases in funding to existing arts boards as well as the development of Creative Saskatchewan, an organization managing grant programs available to a variety of creative industry projects including film and TV. And the recently announced budget calls for increases to those programs, much to the shock of an artistic community more used to provincial cuts.
So that must mean the industry is booming, right? No? Would you believe maintaining? No?
On February 20th, 2014 the Saskatchewan Media Production Industry Association (SMPIA) released the Saskatchewan Media Production Industry 2014 Consultation Report, prepared by Nova Alberts. A survey was conducted with the remaining members of the organization post-credit. The results were then compared to a baseline study conducted with producers in 2011 pre-end of credit. The recent survey had 187 respondents. Here are some of the more fun findings…
1) Only 25.2% of respondents see the stability of the industry as “thriving” or “improving steadily” with 43.9% classifying it as “declining.”
2) 57.1% of respondents say that they are trained and have experience but there is a lack of work in the province.
3) 41.1% of respondents have issues finding funding for their projects, saying that there is too little or the wrong kind of funding.
4) 40.3% of respondents now classify themselves as former Saskatchewan media production industry members who have either found work in another industry or are unemployed and looking in other industries.
Essentially, the point of the report is the outlook for media production in the province isn’t great. One of the first things that happened when the end of the tax credit was announced was the departure of rooted production companies like Emmy-winning Partners in Motion which moved to B.C. and Corner Gas producer Verité Films which moved to Ontario. It also impacted foreign interests who could no longer afford to consider Saskatchewan as an option for production due to the increase in costs. It should be no surprise that one of the key issues the SMPIA report highlights is a lack of jobs for trained professionals thanks to a decreasing number of job creators, aka production companies. It also shows that these professionals are moving on to the greener pastures of provinces whose governments value their media production industries or are leaving the industry entirely.
Back in the fall of 2012, the province’s Chamber of Commerce teamed up with SaskFilm to study the tax credit. They were confused by the decision, wanting to know why it had been made and if the numbers the government was quoting were accurate. What they found was that the cost to the government was not $8 million annually as had been asserted in many reports when the budget cuts dropped; they found a net cost to the provincial government of $1.3 million per year with a net economic benefit of $44.5 million per year that was directly attributed to the SFETC.
Let me repeat that.
It cost the government $1.3 million for $44.5 million in benefits for the province. Over a 14 year period, that’s $108.8 million spent for $623.4 million gained. What the Chamber and SaskFilm found was what everyone had suspected, that the provincial government acted hastily and without public consultation or accurate information. They found a decision that defied the reality of the numbers.
But if this decision was made in spite of numbers, why make it?
One can only hope it’s just because the Government of Saskatchewan did indeed act hastily and didn’t really understand the true impact of what it was doing, which is extremely sad in its own way. But it’s hard to ignore the fact that the arts are rarely supportive of conservative governments and the media production industry is a union driven one. With any luck, the reality is the former and not the latter as it’s a bit easier to forgive an uninformed error in judgment than it is a vindictive move against a philosophical adversary.
For its part, the provincial government did conduct research into the tax credit. After they had already decided to scrap it. That seems like something worth looking into in depth prior to making a decision that impacted hundreds of jobs, thousands of lives, and millions of dollars in benefits to the province.
It’s not all doom and gloom. The Recording Arts Institute of Saskatchewan based out of Saskatoon recently opened a film division and is looking at graduating its first class of students. Great! Now we just need jobs for them. And while opportunities are becoming increasingly scarce, there are still production companies doing business in the province and TV shows being made. Creative Saskatchewan is part of an attempt to provide money to those involved in the media production industry with increases announced in the new provincial budget. But as indicated in the SMPIA study, the current system’s flaws go beyond insufficient funds and more into ineffective distribution/allocation of resources as well as a problematic application system. While a shakedown period is expected to work out the bugs, there was a working system in place; inexplicably hitting the self-destruct button on it and replacing it with a broken one does little to promote the industry both in and outside of the province.
It’s like stealing someone’s BMW then giving them a Pinto with no engine to make up for it and telling them it’s good enough.
Now, the credit is winding down. The final movie to be produced under the old system is Wolfcop, a concept for a film I’m thoroughly behind. Skilled workers are finding opportunities elsewhere. Many of the bigger job creators in this industry have left the province while others have shuttered their doors. SaskFilm is gone and festering away in that shallow grave in a canola field beside the SFETC. Can the SMPIA be far behind if it’s members continue to leave Saskatchewan in search of work or abandon the industry entirely? In a province that prides itself on moving from being a “have not” to a “have” and reversing the brain drain that plagued its growth for years, the Government of Saskatchewan sure didn’t hesitate to drive an entire industry into the waiting arms of other provinces who recognize its value.
If nothing else, the incumbents have given their opponents a great talking point and easy campaign promise in the next provincial election. Saskatchewan’s provincial government isn’t the first one to make this kind of decision and they won’t be the first one to reverse it, regardless of which party is in power when the choice is made. And who knows? Maybe the SaskParty will see the light and reverse course as Election Day draws closer. Stranger things have happened.