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When scriptwriter Jimmy the Exploder directed a very public "F*ck you" towards Jim Schembri, film critic at The Age at the Australian Film Institute Awards in early December, he reportedly inspired a standing ovation from the industry crowd. By contrast, Schembri’s blog on The Age website was overwhelmed with comments supporting his criticisms of the industry.

The incident falls into yet another cycle of hand-wringing over the state of Australian film, underpinned by an astounding level of public ignorance about the workings of the industry, and ill-informed, repetitive commentary from the mainstream media. From within the industry itself there is an unwillingness — or inability — to articulate a meaningful response to criticisms or the sector’s problems. The net result is an almost total absence of intelligent debate about our local screen culture.

In terms of public perception, reader comments posted on Schembri’s blog indicate that the belief our cultural bodies comprise "a bunch of closeted elitists" is alive and well. Isn’t it time we moved past this ridiculous, ill-defined notion? Who exactly belongs to this "elite"? I worked at the Australian Film Commission for several years (in the Publications Unit, so I was not involved in funding decisions), and my experiences there confirmed some of my suspicions about the flawed nature of our film funding. However, the idea that our funding bodies are staffed by a clique living in some kind of isolation zone, deliberately conspiring to fund movies they fervently hope no-one will see, is ridiculous. Understanding the problems of our industry within a framework of "us" (good, simple, ordinary Australians) versus "them" (intellectual, art-loving bureaucrats alien to their compatriots) isn’t just unhelpful – it’s stupid.

The degree of public ignorance regarding the industry is hardly surprising given the quality of the commentary offered by the Australian media. While thoughtful pieces occasionally appear, such as this feature by Michael Bodey in The Australian in early November, most "analysis" is of the kind offered by Deb Verhoeven in this article published in The Age back in 2005. Verhoeven makes the obvious point that Australians aren’t buying tickets to see local films because they don’t like them. She throws in some statistics about dwindling audiences, notes the funding bodies are in denial about the problem, and sums up by saying if things don’t get better we’ll never have a great national cinema. Hardly insightful stuff.

I cite this example from nearly four years ago to illustrate the repetitive nature of writings on the subject. Schembri wrote a piece entitled "At Death’s Door — an industry lost in the dark" making almost exactly the same points earlier this month.

I am not suggesting that Australian funding bodies should not be criticised, or that our screen sector doesn’t have serious problems. But commentary on the situation is meaningless and counterproductive if it’s not informed by some real understanding of the industry, or some useful suggestions to move the debate along.

To give an example of the counterproductive nature of the present discussion, among the comments following Schembri’s blog about the AFI Awards was a suggestion from a reader calling him or her self "El Rey" that read, "Australia has no hope of creating a meaningful film industry based on government funding. The closeted elitists involved in the approval process are fully aware what they’re doing… Leave them to it, and let’s start a fantastic, privately funded industry." Schembri responded to many posts on the thread, but not this one. Above this post, however, he formulated his own brilliant solution for the industry’s woes: "Stop granting money. Start loaning it. That way filmmakers go in knowing that the best way to return the money is to design their film for an audience."

The idea that Australia can support a commercially viable, profitable film industry is pure, unadulterated fantasy. If there was money to be made making movies, Australian businesses would be doing it. Apart from those in the US and India, no national film industry on the planet could survive without subsidies. Even Hollywood receives considerable assistance from the US Government. Washington often insists, for example, that screening quotas for local films be eliminated as one of the conditions of free trade agreements, as South Korea found in 2006.

Furthermore, like all industries Hollywood produces far more flops than hits, but it survives partly through sheer weight of numbers, and partly because it doesn’t rely on box office takings. Since the 1970s, the bulk of Hollywood’s profits have come from videos and DVDs, merchandise and other film-related products. The idea that Australia might compete in the same ballpark is delusional. Even during the local industry’s heyday of the 1980s, production was fuelled by massive subsidies through the 10BA tax rebate mechanism. Film production is simply too expensive and Australia too small to make this activity profitable. If we want a screen sector, the state has to play some kind of role. The alternative is to simply let the sector die.

Schembri presumably knows this — and if he doesn’t why is he a film critic for one of our major broadsheets? He could enhance public understanding and further the debate by pointing out some of these facts. Instead, he encourages public misconceptions and makes facile suggestions about loaning money he knows full well could almost never be paid back.

In addition to promoting completely unrealistic visions about what is possible in the Australian context, mainstream media commentary invariably focuses solely on feature films. Our documentary sector, which has arguably produced the most notable work of recent times, rarely rates a mention.

The Indigenous sector similarly receives scant attention outside flourishes of interest around large public events like the annual Message Sticks Film Festival. Yet the story of Australian Indigenous film is one of the industry’s few unqualified contemporary successes. Anyone who has tried to get a seat in the massively oversubscribed Message Sticks screenings at the Sydney Opera House knows that there is a sizeable and passionate audience for these films. The achievements of this sector are significant because Indigenous film has been developed under a funding model quite different to the one covering the rest of the industry.

Under the guidance of the Indigenous Branch of the Australian Film Commission (incorporated into Screen Australia as of July this year), the careers of Aboriginal filmmakers have been nurtured through a carefully planned series of workshops, funding programs and initiatives spanning many years. This is quite different to the project-by-project funding regime under which other filmmakers work.

Aboriginal filmmakers have also been encouraged to work across a range of forms, from features and documentaries to cross-platform projects. Crucially, all of this activity has been underpinned by a vibrant Indigenous television sector in the Top End, where filmmakers like Warwick Thornton, Wayne Blair, Steven McGregor and Beck Cole cut their teeth. Obviously this model has been tailored to suit the needs of a particular group within Australian society, but its success is never discussed or analysed for possible broader lessons.

While many Indigenous filmmakers are working fairly constantly, other Australian film personnel spend more time searching for employment than making movies. According to statistics published by the AFC, in the past 30 years 65.9 per cent of our feature film directors only made one movie. A scant 20.2 per cent made three or more. The figures are even more dismal for producers.

How many of the world’s great directors produced a masterpiece with their first feature? Orson Welles’ Citizen Kane or Quentin Tarantino’s Reservoir Dogs represent exceptions rather than the rule. Most directorial talents, from George Lucas to Antonioni, made many films before producing the work for which they are remembered. Yet the limited amount Australia invests in its system of project-by-project direct funding encourages an endless stream of first-time directors. Most are too wearied by the process to ever attempt a second feature. How is Australia supposed to forge an artistically vigorous cinema, let alone a "commercial" industry, when the vast majority of our filmmakers only get one shot at making a film? This obvious and vital question is rarely asked by the media, who too often indulge in offering opinions on the kinds of films we "should" be making. If critics like Schembri are so certain about what makes a hit movie, why don’t they make one and retire on the profits?

Australia has enjoyed one prolonged period of rolling production, and that was in the 1980s. At the height of the 10BA tax rebate system that underwrote the era’s production boom, investors could write off capital expenditure on film production at a rate of 150 per cent. The industry was consequently flooded with privately sourced funds and some of our most popular films were produced, including Mad Max, Crocodile Dundee, The Man From Snowy River and Gallipoli. There was also a lot of dross produced, as there is in every active industry. The point is that filmmakers of all kinds had the opportunity to work and hone their craft. The funding bodies continued to play an important role, but they were not the sole arbitrators of what features were made. The mix of direct funding and 10BA subsidies allowed big-budget genre cinema, mainstream television dramas, and genuine experimentation to co-exist in a vibrant, broad and highly active production sector.

The new production tax offset currently being implemented by Screen Australia is potentially a move in the right direction, designed to attract private funds back into the sector and open up opportunities for a broader range of productions. It is up to the funding bodies to articulate what role they will play if this occurs, and to encourage real innovation — as opposed to middle-of-the-road products that interest neither mainstream audiences nor hardened cinephiles — alongside features aimed at a broad audience.

If the Australian media can bring themselves to inform the Australian public of the facts, as well as facilitate some useful debate rather than wheeling out the same old tired opinion pieces, it’s just possible Australian cinema might start moving forward.

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.