Canadian Heritage Committee on April 29th, 2015

[Monique Simard]

Yes.

[Pierre Nantel, NDP, Longueuil—Pierre-Boucher, QC]

You were speaking to your members.

Ms. Simard, you were once in politics, but mostly you have produced documentaries. You had worked at the NFB where you contributed to setting up the famous NFB app for smart phones. Putting its catalogue online, where everyone can have access to it, as is the case for heritage archives, is a great achievement for the National Film Board.

Today you are with SODEC. As such, at the AQPM meeting I attended, you said to the producers there that even though it is now more complex to produce films or television programs, it was not the right time for them to retire or to sell their production houses, because we need them to stay to help us cross this river that is the new broadcasting universe.

You alluded to the Godbout Commission report. In addition to funding, is the visibility of films that are produced here an issue? In the past, we had control over the visibility of our cultural production. Today, control is in the hands of international players who are not regulated, such as Netflix, even though they may have a .ca address. If everyone turns to these platforms to consume cultural products, are we not going to face a visibility issue for our own products?

[Monique Simard]

As a producer, I made over 150 films. I was then the executive director of the National Film Board of Canada's French Program during five years, and I took part in the great digital shift at the NFB, by opening interactive production studios, among other things.

Today, there is indeed an issue with visibility, since the offer is overabundant. There are no more borders. The concepts of time and space are now entirely relative, and as Ms. Collin was saying earlier, everything is changing extremely quickly.

During the few years I spent at the NFB, I had to change our technology three or four times to adapt the productions. If we want to be visible, the real challenge today is to continue to support the works that are written, produced and filmed by Canadians and Quebeckers, in our case, in Quebec. We have to find the necessary means and resources. The Canada Media Fund is one of the models we had; I mentioned it previously.

The discussion we are having here today is also being held in all of the European countries, be it in France, Germany, England or elsewhere, because all of us are grappling with the invasion of an extremely abundant offer on our territories. How can we establish our own offer in our own country? That is the big issue. To be able to do it, we have to have the necessary means. I think we have to support creation and production, but I also think that we have to be able to support what I call the development of the works, that is to say the marketing, the commercialization, the distribution, and we must do that with all of the means at our disposal, including social networks.

I think that the Internet and cell phone technology are basically the two big “highways” through which today's culture will be consumed, not only film, but also music. This is the case everywhere in the world. We should in some modest way put these two highways to work to ensure that the producers have the resources they need. I say—

[The Chair, Conservative, Gord Brown]

Thank you. I must interrupt you because the time is up.

Mr. Dion, you have the floor for seven minutes.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Thank you very much, Mr. Chair.

I want to thank all of our witnesses, whether here with us in the room, or with us through teleconferencing.

Good afternoon, Ms. Simard.

[Monique Simard]

Good afternoon.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

I believe it was Ms. Collin who suggested a measure. It had already been proposed here in the course of the work of the committee. The point is to prevent the tax credit from being made available only at the end, which forces people to borrow money and generates costs. Ms. Collin, I think you had recommended that 75% of the amount be provided. That could be debated. A part of the credit could be provided in advance and the rest of it at the end, once everything has been done.

Does that seem doable to you?

[Monique Simard]

It is quite doable if the regulations concerning fiscal assistance are amended. Ms. Collin is correct. First, we wait for the money. While waiting for the funds, interim funding is very costly. We could say that that is a perverse collateral effect of the system. The tax credit formula as such is terrific. We invented this in Canada and Quebec, and people have imitated the formula throughout the world. The system has been in effect for a little more than 30 years, about 35 years, and it can certainly be improved.

With people in producers' associations, we constantly discuss the need to reduce cumbersome administrative procedures. This would facilitate the work of most producers. Most production houses have very few employees. I would, for my part, be entirely favourable to any measure that would curtail the bureaucratic aspects.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Fine.

From what I hear, you have no problem with this reform.

[Monique Simard]

I see disadvantages to the extent that some could oppose it, but that will not be the case for SODEC.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Very well.

[Monique Simard]

We manage the seven tax credits for culture. We submitted a certain number of improvements to the system to the government. We think that in a lot of cases certain steps could be eliminated and this would not cause problems. There are often two opposing philosophies when it comes to tax assistance. The first is to not advance a penny before a quadruple verification has been done and before several years go by after the production. According to the other philosophy, funds are advanced, as is done for subsidies, once the files are complete and once the business's credibility and soundness have been verified.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Thank you.

Almost all of the stakeholders—Mr. Lemieux, Ms. Collin and Ms. Doucet—mentioned the importance of beefing up funding for Telefilm Canada.

You also insisted on the need to update support systems. Before increasing funding for Telefilm Canada, we need to agree on whether that is to have it continue to do the same things, as though the world had not changed, or whether it is to adjust federal aid to the new environment in light of all the challenges you mentioned.

I would like to hear your opinion.

[Marie Collin]

With your permission I will answer that question, Mr. Dion. First of all, I would be remiss if I did not point out two things.

Concerning the tax credit, I spoke about increasing effectiveness thanks to the 75% you have just spoken about. However, I forgot a very important point. Provincial aid such as the tax credit, and any form of aid, reduce the federal tax credit. This means that on the average, feature films in Quebec—or French-language films—only receive 3% of the federal tax credit, whereas the maximum is 15%.

If we could work on eliminating those reductive effects, that would be one way of helping to fund producers. It would be very simple to apply.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Regarding the cut from the federal tax credit when there is a provincial tax credit, would you say that this affects Quebec more than other provinces because the Quebec provincial tax credit is more generous?

[Marie Collin]

I'm going to ask Ms. Doucet, who is a tax credit specialist, to reply to your question.

[Brigitte Doucet]

In fact, the provincial tax credit is a part of these reductive forms of assistance and it is indeed higher. However, there are also other forms of reductive assistance. At the federal level, all of the government assistance is reductive.

In fact, if we compare the situation of French-language films to what happens for English-language films, the difference comes from the fact that English-Canadian films can obtain foreign licences more easily, as well as funds advances for foreign distribution that complete their financial structure. This means that proportionally speaking they may receive less public assistance than Quebec films, because it is more difficult to export French-language films.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

If I understand you correctly, you are saying that when you obtain other forms of assistance, the reduction in the federal income tax credit does not affect Quebec more than the other provinces.

[Brigitte Doucet]

In fact, it does, for the reasons I have just explained, since the government aid reduces the tax credit.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Consequently, if you obtain aid from a private foundation, that is not withdrawn from the other funding.

[Brigitte Doucet]

Correct.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Thank you.

[Brigitte Doucet]

Moreover, because of the language of the production, it is easier to have access to that private aid to export an English-language product. In short, things are more difficult for the francophone market.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

That information is important for the committee.

[Marie Collin]

Yes.