OPENING SALVO I am also deeply opposed to governments doing deals with individual companies, whether Mediaworks, SkyCity or Warner Brothers. At best, it risks misallocating resources. At worst, it creates crony capitalism. Yet ...
OPENING SALVO
My children have decreed that I shall attend The Hobbit.
I shall do so under protest.
Enduring the three-hour long Fellowship of the Ring was enough for me and I am now the grumpy old bastard who won’t watch Air New Zealand’s new hobbit safety video.
I am also deeply ideologically opposed to governments doing deals with individual companies, whether Mediaworks, SkyCity or Warner Brothers. At best, it risks misallocating resources. At worst, it creates crony capitalism. Always remember that it was Sir Robert Muldoon who first played silly buggers with the tax laws to benefit the movie industry.
And yet …
3000 jobs
In 2010, local union bosses Robyn Malcolm and Jennifer Ward-Lealand put The Hobbit at risk, backed by Council of Trade Unions supremo Helen Kelly, Australian union boss Simon Whipp and Phil Goff’s Labour Party.
Similar threats had been made, unsuccessfully, against Outrageous Fortune.
The detail of the dispute was never made clear – Ms Malcolm and Ms Ward-Lealand wailed that they just wanted to talk, and prattled on about the long-since-repealed Employment Contracts Act – but its essence was that foreign actors’ unions wanted to reduce the competitiveness of New Zealand’s film industry against their own.
There was talk of a global union boycott of New Zealand films.
In a wonderful display of defiance against union thuggery, local actors took to the streets to harass and abuse Mr Whipp, despite him claiming to speak for them.
John Key, Gerry Brownlee and Steven Joyce then became involved, and controversially provided VIP treatment, including government limousines and airport facilitation, to Warner Bros executives.
On the face of it, the deal they struck at Premier House was outrageous.
New Zealand employment law was immediately changed to suit the company and criteria for Trevor Mallard’s Large Budget Screen Production Fund expanded to deliver more cash rebates.
In fact, the prime minister gave nothing away.
The amendments to the Employment Relations Act simply clarified that someone who got a part riding a warg around the South Island for a couple of months was a contractor and couldn’t claim to be a full-time warg rider. They were nothing a National government shouldn’t have done anyway.
Mr Brownlee also noted that Sir Peter’s Return of the King had been one of the biggest selling DVD of all time. He suggested that, in return for the concessions, Warner Bros be required to include a video promoting New Zealand, to be made by no less than Sir Peter, in all downloads and DVD packs of the movies for all time.
The Sound of Music affect
While Mr Brownlee’s insistence irritated the Warner Bros executives, who would have preferred a free lunch, they agreed and the value of that promotion will vastly exceed its cost to the taxpayer.
The deal also made Tourism New Zealand a strategic marketing partner for Time Warner, by some measures the largest media company in the world.
While it seems implausible that anyone would fly across the Pacific to see where a film was made, tourism experts insist otherwise.
Their market research suggests that Sir Peter’s movies are the single biggest factor raising awareness of New Zealand as a tourism destination at the present time.
Nearly 50 years on, Salzberg still attracts tourists who believe its hills are alive with The Sound of Music.
The government can also to point to 3000 jobs which would have gone offshore had the union campaign been successful.
It’s also better that Air New Zealand has the vulgar hobbit safety video and plane than Qantas or British Airways.
What’s more, by all accounts, the movie is good enough to be nominated for Academy Awards with all the publicity that will bring, sending a message to other studio bosses that New Zealand is a place where they can make history-making productions.
Deal making
For better or worse, when Mr Key deposed Don Brash as National Party leader it was interpreted as a shift from a strict belief in markets to more Singaporean-style corporatism.
Voters also continually endorse greater government intervention.
The Hobbit deal is one Lee Kuan Yew would have done.
In doing such a deal, Mr Key cannot be criticised for governing the way he promised.
If there is criticism, it is that he hasn’t done enough of them.
