Canadian Heritage Committee on Dec. 4th, 2006

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Is that the minister's file? Is she responsible for that?

[Jean-François Bernier]

She is dealing with it, but we do advise her. For example, on December 14^th, she will meet with various film industry representatives, here, in Ottawa. Telefilm Canada officials no doubt spoke to you about their two linguistic working groups.

[The Chair, Conservative, Gary Schellenberger]

Thank you

We have to move on to Mr. Kotto.

I'm sure you'll have another chance.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Well, if you say so, Mr. Chairman. I'll take you at your word.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Thank you, Mr. Chairman.

Welcome.

In recent years, the mandate of Telefilm Canada has expanded, particularly with regard to multimedia, but the amounts allocated to the Crown corporation have remained the same. At the same time, production costs continue to increase year after year.

Does the Department of Canadian Heritage believe that it is important to provide the Quebec and Canadian film industry with adequate support? In other words, does Canadian Heritage believe that it is important to increase funding to Telefilm Canada, which is the lead agency for this sector?

[Jean-François Bernier]

You said you wanted to ask several questions.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Very well, I will move on.

[Jean-François Bernier]

If I may, I can answer that question.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Go ahead.

[Jean-François Bernier]

The answer is quite simple. Yes, the department believes it is important to fund Canadian feature films. Nowhere did we indicate, whether in the government's response or during our current activities, that the government was withdrawing its support from feature films. That goes for both Quebec and Canada as a whole.

New media is another sector of sorts. One of my colleagues is working in that area. A program assessment was done, and recommendations on how to deal with new media will be sent to the minister.

[Maka Kotto, Bloc, Saint-Lambert, QC]

For the first time in five years, box office receipts from Quebec films will decrease this year, despite the fact that Bon Cop, Bad Cop set new box office records. There are concerns that as of next year, theatre admissions for Quebec films, at least market share, will drop to 10%.

In your opinion, what are the reasons for such a drop?

[Jean-Pierre C. Gauthier, Director, Film and Video Policy and Programs, Department of Canadian Heritage]

There are several reasons for that. First of all, the level of funding by Telefilm Canada to support film has remained unchanged since the policy was implemented. What we are seeing, in fact, is an increase in the size of production budgets. At the outset, Telefilm Canada provided 25% of production budget funding. And yet, that proportion has increased. It now amounts to 35%, however production budgets have also increased.

The primary effect of this is that Telefilm cannot fund as many films. An assessment of the industry shows that box office success is more dependent on the number of films than the size of budgets. Film market share is much more dependent on the number of films shown on movie screens. Consequently, the reduction in the number of films has probably led to a drop in the number of moviegoers, in the case of Quebec films.

However, we do always have to put things into perspective. This is a volatile industry. Success at the movie theatre cannot be predicted. There will be some very good years, such as 2005, when records will be broken, but there will also be years with somewhat more modest success, when market share will be around 20%, as was the case this year and in 2004. We need to take a step back to determine whether this is a trend or not.

[Maka Kotto, Bloc, Saint-Lambert, QC]

You have just answered another question that I was going to ask you, that is whether Telefilm Canada's Feature Film Fund was sufficient or not. Clearly, it is not.

[Jean-Pierre C. Gauthier]

In my view, we can make do with the amounts we currently have.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Despite demand, success, costs—

[Jean-Pierre C. Gauthier]

You have to recall that current funding has allowed us to meet the objective of 27% in 2005. There will be a margin. Could additional funding make a difference? Of course. However, in the past five years, the amounts available to us have allowed us to further the policy's objectives. It is with this in mind that we want to continue doing our work.

[Maka Kotto, Bloc, Saint-Lambert, QC]

I understand the constraints you have to deal with in carrying out your functions, but I will still ask you the following question. Given what happened over the summer and Quebec's ambitions for the future, does the federal government's film funding contribute to the development or the decline of Quebec film?

[Jean-Pierre C. Gauthier]

For me, federal funding most certainly contributes to the development of film, whether in Quebec or Canada as a whole. The funding is crucial and much appreciated. The fact that people want more of it shows how important it is. I therefore believe that the role played by Telefilm Canada and the federal policy are positive elements.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Thank you.

[The Chair, Conservative, Gary Schellenberger]

Mr. Angus, please.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Thank you.

One of the issues that came up consistently during our feature film study was the need for a competitive tax environment, because now we see our competitors actually taking the Canadian model and reworking it. We're also dealing with numerous provincial tax incentives. It's all over the map. There's the federal issue. Then we're going up against U.S. and state competition, and it is clearly targeted that they don't want the production here. They want it moved stateside.

What's the turnaround time on a recommendation to actually see a response from your department, to be given to the minister, and then from there, what kind of turnaround would we see in terms of timelines for actually setting a new policy?

[Jean-François Bernier]

This is not a question specifically related to tax incentives.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Well, you have a consultant in now to look at the tax credit. Right?

[Jean-François Bernier]

Yes.

[Charlie Angus, NDP, Timmins—James Bay, ON]

How long will that take? Will you be looking at the environments that we're going up against and what's feasible?