Tight money slows Australian filmmaking. `Crocodile Dundee II' among the few new titles just completed

Australia's ``cultural flagship'' - as actor Sam Neill calls the film industry - is leaking badly. And directors, producers, and actors are manning the publicity pumps to keep the industry afloat. A year ago at this time, 64 films, TV miniseries, and documentaries were in the works. Now, only four are on tap. And no projects are slated for after July 1.

What's happened?

Private investment money for Australian-made films has dried up. So the movie industry here is lobbying the federal government to take steps to keep the cameras rolling.

After nearly a decade of producing such globally acclaimed films as ``Picnic at Hanging Rock,'' ``Breaker Morant,'' ``My Brilliant Career,'' and ``Crocodile Dundee,'' it would be ``a tragedy if it all went down the gurgler,'' says Philip Adams, chairman of the Australian Film Commission, which supports cinema and television film production, distribution, and marketing.

Cynics say this is just the annual ``cry wolf'' chorus that erupts before the federal budget proposals in May. But this year, filmmakers face a real crisis.

An overall drop in income tax rates, coupled with a reduction in the tax write-off allowed for film investments, has cut private investment in screen and television ventures from $180 million (Australian; US$130 million) in 1986-87 to an estimated A$45 million (US$32 million) this year.

Also, from here to Hollywood, the October stock market crash has meant that at the front end there's less ready cash for financing risky projects, such as films. And at the back end, distributors facing uncertain markets are paying less for produced films.

To stave off nearly total collapse of the Australian film industry, two solutions are being floated. First, to revamp tax incentives to make films more attractive investments. Second, to set up a film finance corporation or ``film bank.'' The latter is most politically popular.

The bank would be a government-owned corporation designed to provide venture capital and loans to produce movies.

It would differ from a traditional bank, by accepting riskier projects, and would likely run an annual loss. (On average, only 1 in 5 films is profitable.) That loss would be covered by an annual federal grant of A$56 million, which would underpin a production base of A$120 million (or about 20 feature films, 12 to 14 miniseries, 16 to 18 TV movies, and 40 to 50 documentaries), according to a feasibility study by Coopers & Lybrand W.D. Scott, an accounting firm.

Currently, about A$19 million in government subsidies for experimental films, scripts, and youth technical training is allocated through the film commission. But to ``sustain a film and television industry in a domestic market of only 16 million people will require a further federal support,'' says Kim Williams, executive director of the commission. He notes that in a survey of 11 major film-producing nations, only the United States did not receive government funds directly, but it does receive tax incentives.

The film bank and other proposals have been on the table since April last year. But it has taken the actual slump in production to awaken the Australian Parliament to the problem.

In February, after meeting with industry officials, the minister for the arts and territories, Gary Punch, said, ``We're not going to let down the Australian film industry. We intend to make sure it continues to operate at a high level.''

Money is tight, however. The ruling Labor Party has generally not been eager for industry assistance. Treasury officials and privatization proponents are known to be cool to the film bank concept. And the budget balancers are even less fond of the A$25 million bridge loan, also requested to keep the spotlights on until a new financing system is introduced.

In fact, government sources say the bridge loan won't be approved. Later this month Mr. Punch is expected to announce support for a modified film bank concept. The film industry will survive, sources say, but in a shrunken form.

Why should government subsidize an industry of 3,000 people if it's largely ``uneconomical''? Industry officials argue that films are the most effective way of exporting Australian culture, and thereby generating not only goodwill but more business for Australia.

``Films are the front line troops. They go in first. The US film industry has created an interest in and an aura around American products in the rest of the world,'' says Chris Noonan, president of the Australian Screen Directors Association.

To some extent, Australian films have succeeded in this way, he notes. The blockbuster hit ``Crocodile Dundee,'' for example, has prompted tourists to visit Australia. And it has fueled interest in Australian-made beer, clothing, and restaurants - products and enterprises now flourishing in the United States.

A native film industry enables Australians to understand their own society by putting their lives, landscape, and history on the screen.

``We can watch Australians being heroes, speaking with Australian accents,'' instead of relying on British or American role models, says Mr. Noonan. Mr. Williams at the film commission echoes that sentiment by noting a surge over the last decade here in the popularity of Australian television programming.

In any case, fans of Mick Dundee have no reason to worry. At least not yet. ``Crocodile Dundee II'' is in the can. And Australian director Fred Schepisi has already shot Meryl Streep's outback scenes for ``Evil Angels.'' But it's clear from financing options being considered that movie marquees around the world will carry fewer Australian film titles 12 to 18 months from now.