ARTS: A recommendation that the Irish Film Board should be abolished has been rebuffed by the Minister for the Arts - for now. But the warning contained in pre-Budget funding discussions has not been lost on indigenous film-makers, writes Ted Sheehy

It was at the launch of the Irish Film Board's annual review on December 11th that the Minister for Arts, Sport and Tourism, John O'Donoghue, laid the ghost of Christmas future that had briefly haunted Irish film-makers. Departing from his speech to decry those "others" who saw no rationale for the IFB's existence, he went on to say: "I have tremendous confidence in the Irish Film Board and its staff, and to their commitment to the indigenous Irish film industry."

In the previous week, Irish film producers had first had to grin and bear Charlie McCreevy's announcement that he would be cutting short the life expectancy of the Section 481 tax relief for film investment. Then it emerged that the so-called "three wise men" had recommended the abolition of the IFB in their review of departmental spending estimates for 2003.

The aim of this three-man Independent Estimates Review Committee - or "An Bord Snip", as it was dubbed in parts of the public service - is to "focus on, but should not be confined to, a review of (a) the policies and programmes of a relatively lower priority identified by each Minister/Department and (b) proposals in relation to expenditure priority adjustments identified by the Department of Finance".

The Committee's justification for recommending abolition of the IFB, just a year after its role had been enhanced as a matter of Government policy, was that "there is sufficient financial incentive provided to the film industry in Ireland through the Finance Act. In the tax year 2000/2001, for example, reliefs under section 481 of the Taxes Consolidation Act 1997 amounted to €29.2 million.

In view of this the Committee believes that the continuation of the Irish Film Board is unwarranted. The immediate scaling back of activity should yield savings of €4 million in 2003."

Irish film producers with long memories were aghast when they heard this. The IFB had been stood down once before - by Charles Haughey in 1987 - and surely that couldn't be contemplated again. It had taken years for the momentum lost in 1987 to be regained when the IFB was reactivated in 1993. The Section 481 tax relief was put in place at the same time and together the measures created a film funding synergy that supported local producers while seducing their foreign counterparts into bringing big films like Braveheart here.

The recommendation seemed to favour retaining the stream of funding which, in cost terms, greatly benefits foreign producers, while dispensing with the IFB's funding for indigenous production and areas (such as project development) that are not supported by Section 481. But, according to the Department of Arts, Sport and Tourism, "the Report of the Independent Estimates Review Committee did not explain why the recommendation to abolish the Film Board was made".

The film producers' representative body, Film Makers Ireland (FMI), reacted with concern "that the Independent Estimates Review Committee might not be aware of the key role [of the IFB] in the production of indigenous and European co-productions".

In the run-up to the publication of the pre-Budget estimates in November it was, it seems, a close-run contest between O'Donoghue and McCreevy over the size of the axe hanging over the IFB. In the end, the axe left the IFB with an aggregate 12.45 per cent cut - 1 per cent chopped from administration, and 14 per cent chopped from training and capital.

How real the threat of abolition was may be judged from the official account of the outcome of the debate between the ministers: "The Minister secured the agreement of the Minister for Finance to the retention of funding for the Irish Film Board to ensure it will continue to have a central and vibrant role in the development of the indigenous film sector."

As recently as 1999, a ministerially appointed film industry Strategy Review Group (SRG) had recommended in the Kilkenny Report that "the Government must express its partnership with the industry through a strengthened and restructured Film Board. The Board will consolidate and develop its existing functions and undertake additional tasks".

The SRG's recommendations concerning the IFB were only fully put into effect last year after the then government had made provision for increased staff numbers and additional resources.

It is hard to see how the Independent Estimates Review Committee could have been unaware of this, since one of its members, Kevin Bonner, had been a member of the SRG, which had deliberated for over a year before producing the Kilkenny Report.

Bonner is also a director of a film production company, Merlin Films, that has raised in the region of €73 million in Section 481 film investment, according to the Department of Arts. Merlin Films has received one production loan from the IFB, for The General. An earlier production loan offer to one of the company's productions, Angela Mooney Dies Again, was not proceeded with by the IFB when its conditions were not met by the company. Kevin Bonner, while reluctant to comment on the workings of the committeee, said that they made their recommendation collectively after meeting all departments and that they agreed to let their report speak for itself - "As we say in our introduction, 'there is no painless way of curtailing expenditure growth'."

Merlin Films has itself reacted strongly to the proposal to do away with the Film Board. "We were awarded €500,000 in respect of the making of the film The General. We would add that this film, which won best director at the Cannes Film Festival 1998, could never have been made without the support of the Film Board.

"Both John Boorman \ and Kieran Corrigan [managing director] consider that the Irish Film Board is absolutely essential to the future promotion of the Irish film industry. It would be disastrous if anything were to happen to the Irish Film Board, that would mean this source of funding was no longer available to Irish producers."

Asked if it believed a potential conflict of interest might have arisen in the estimates review process, the IFB replied: "In a small industry many people assume different roles, we would expect that when potential conflict of interest occurs, it would be declared and avoided."

The recommendation that the IFB be scrapped has been, as the Department of Arts puts it, "reversed following discussion between the Minister for Arts, Sport and Tourism and the Minister for Finance."

But there's no room left for complacency among Irish film producers who are now, according to FMI, readying themselves to "communicate, educate and sell the tangible benefits of a long-term Government-based film policy through the aegis of Section 481 and the Irish Film Board".