Hollywood producers want New Zealand to up its 15 per cent subsidy for big budget films to offset the higher cost of film-making here caused by the weak American dollar.

The producer of Avatar, James Cameron, made the comments on TVNZ's Q&A programme, following Prime Minister John Key's whirlwind visit as his guest to Los Angeles, where he visited major studios and attended a private dinner involving the heads of major US studios.

"I wasn't privy to every discussion," said Cameron of the dinner, where Key circulated among the tables. "You know, there were discussions of possible increases in infrastructure, stage space, you know, the idea of possibly altering the rebate scheme to keep pace with the change in the dollar."

"We will consider that," said Prime Minister Key.


Key told Radio New Zealand this morning several studios had raised the issue of the large budget screen production grant, "in so much that they are aware that we have a pretty good scheme already".

"For the most part every scheme around the world is slightly different, but then every country that makes movies outside the United States actually has a scheme. So it's just sort of a fact of life if you like."

He said television studios had voiced their wish for subsidies on the production of television, which he was open to considering.

"There is a little bit of logic about what they're saying, I can understand one or two of the issues but we will need to go away and talk those through carefully."

Key said it was important to lure television productions to the industry busy while big movies are not in town.

Oscar-winning producer of the The Lord of the Rings and Hobbit movies, Sir Peter Jackson, had raised the suggestion o looking at the subsidy in a pre-taped message for the group o fmovie makers.

The message was that New Zealand needed to consider how to respond to its strong dollar, which has sat above US80 cents for some 15 months, hurting exporters trading in US dollars and eroding New Zealand's competitiveness as a film-making destination for American studios. The local currency's strength against the greenback largely reflects a slump in the value of the greenback as the US Federal Reserve prints money to try and kick-start its economy after the global financial crisis.

Australian Prime Minister Julia Gillard reportedly promised last week to consider a request that Australia raise its current 16.5 per cent rebate to 30 per cent.


The New Zealand scheme offers a 15 per cent rebate, in other words a taxpayer payment, to the value of 15 per cent of any film costing more than $15 million to make, with an additional 15 per cent rebate on post-production costs.

Cameron said Key had pitched New Zealand as a "very competitive" place to make movies, despite not having the highest incentive scheme in the world.

"He felt that with a lot of the other factors - such as the English language, kind of the work ethic and skill of the crew, the resources that are available within the country, the locations, you have a core competence in terms of visual effects, the artisanry of set construction and so on - that all of those things add up to a very attractive full package."

Cameron said Wellington's film infrastructure was now at global industry standard, "competing directly with what's happening in Los Angeles or London."

"I think if some accommodations need to be made to foster that, I think the benefits to the New Zealand economy will far outweigh, you know, any potential deficit," Cameron said.

-with nzherald.co.nz