Home' The Wellingtonian : January 24th 2013 Contents 11
THE WELLINGTONIAN, JANUARY 24, 2013
Movies prove worthwhile investment
Ten years ago, Finance Min-
ister Michael Cullen sug-
gested that because tax
breaks had helped to fund The
Lord of the Rings trilogy, every
New Zealander deserved a free
ticket to the films.
A similar sense of disgruntled
ownership has recently emerged
with respect to The Hobbit trilogy.
Last week, for example, New
Zealand First leader Winston
Peters tapped into a rich vein of
public resentment against the
subsidies paid to attract major
Hollywood film productions to this
country. Surely with The Hobbit
being so successful, Warner
should pay back the subsidy?
Yes, perhaps Warner could have
afforded to make The Hobbit with-
out a subsidy, and plainly it could
afford to pay back the money we
offered to it.
On the other hand, the private
sector routinely receives help from
The vast bulk of this country s
research and development, for
example, is carried out by the
state -- and many of our major
companies (Telecom, Air New Zea-
land, Solid Energy) started out life
as state enterprises.
Should some payback be requi-
red in those cases, too? Hardly.
Yet the same process of public
support and private gain occurred
there, too, but with no similar out-
Not only would any alleged
onus of payback for Warner be
highly selective, it would be devil-
ishly hard to create and monitor a
Should the payback require-
ment kick in from the first box
office dollar after the production
and promotion expenses are met?
Or would a reasonable profit -- say
10 per cent -- on the overall costs
of the film be allowed before the
payback criteria kicked in?
It is far easier to demand a pay-
back than to figure out how such a
system could possibly work.
In the film industry, trans-
parency is hard to come by. Even
now, the costs and the scale of
benefits from The Lord of the
Rings remain unknown. The film-
makers insist The Lord of the
Rings tax breaks were small,
affordable, and delivered great
rewards for New Zealand, while
the government insists they were
big, essential, but only marginally
Successive governments have
kept the costs and benefits of The
Lord of the Rings tax breaks a
secret, even from the taxpayers
who funded them.
Conveniently, the secrecy
ensures that other sectors of the
economy can t easily mount a case
for similar treatment.
Thankfully, since they re not
tax breaks, The Hobbit subsidies
pose no risk to the country s
revenues. Our current large
budget film subsidies are grants
that kick in only after the likes of
Warner have spent large sums of
money here, and generated econ-
omic activity, upskilling and job
creation benefits along the way.
True, Warner finally got back
15 per cent of its The Hobbit
spend, but to qualify it needed to
spend hundreds of millions of dol-
lars here first.
The real damage done to New
Zealand was entirely self-
inflicted. The Key government
freely offered to change our
employment laws to make it chea-
per and easier for Hollywood to
hire and fire workers in our film
That aside, New Zealand has
tried for years to become less
reliant on primary exports.
Almost accidentally, film has
become the knowledge economy
sector of our dreams.
Perhaps we should be celebrat-
ing that our investment has paid
off, rather than spending so much
energy in begrudging the outlay,
and in treating Warner as a
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In Miramar alone, we were
looking at a ghost town before The
Hobbit was confirmed -- we now
have a vibrant community, more
than 15 new businesses and the
best restaurants in town.
The morale of having The
Hobbit should not be
underestimated in terms of the
greater Wellington economy and
we shudder to think what
Miramar and Wellington might
have looked like without it.
These extra jobs are in
hospitality, real estate,
employment, tourism and the
There will be significant flow-on
effects over the next 10 years.
We applaud the Government in
its determination to hold on to
The Hobbit, and believe the
subsidies were cost effective.
Enterprise Miramar Peninsula
In response to deputy mayor Ian
McKinnon (January 17), I suggest
that Mr Poole was paid
handsomely for his skills.
A smooth transaction at his
departure is what we expect.
However, Mr Poole will be
haunted by Map SK 201 on page
25 of the Golden Mile Statement
of Proposal showing legal bus
measurements at one-third of
their actual size to give the
impression there was plenty of
room for buses through Manners
Mall, so fooling the public.
If Mr Poole was prepared to
make shortcuts on major projects
in the CBD, where else has he
failed the ratepayers, and was it
really worth the pain?
MARIA VAN DER MEEL
I write about my city s past, which
you have misrepresented with
your celebratory and highly
selective editorial (January 17).
Yes, when my ancestors
disembarked the Aurora on
January 22, 1840, they, and
others like them, were hardy ,
strong and tough . But my
ancestors were also convinced of
their own racial superiority.
These beliefs, combined with
the sheer numbers of later
settlers, had terrible
consequences for Maori, whose
land and authority were steadily
Colonial racism would later
have tragic consequences for other
ethnic minorities, such as the
We have four ways to approach
Wellington s history on our
holiday. We can celebrate the
comfortable parts, ignore it
altogether, feel guilty about it, or,
by far the most constructive,
acknowledge the past in all its
messy and challenging
Perhaps the latter approach can
help us build a platform for
positive, future relationships with
each other. MICHAEL HARCOURT
Get rid of
Your article (January 17) on the
$158,000 that has been spent on
safety improvements along the
Golden Mile shows how serious
the council is on public safety.
Where are the figures that show
the economic cost of the carnage
that has resulted from the
council s fatal decision to run
buses through Golden Mile?
Not to mention the lives that
have been lost or injured and the
trauma and grieving by the
The council needs to do the
right thing and admit it got it
wrong and pay restitution to the
Collectively, the council doesn t
seem to have the guts to reverse
its fatal decision and make Golden
Mile a walkway so that
pedestrians and shoppers can go
about their business safely.
Just how can you be proud of a
number like $158,000 when the
human cost must amount to
Maybe this is another reason
why we need a regional council.
Too many people have their pet
Your story on a large spend-up on
safety made me laugh.
Council spending on Golden
Mile safety, at $158,000, is
chump s change compared to the
$90 million price tag on the
proposed Basin Reserve flyover.
That s $225,000 for every metre
of the 400-metre flyover.
Cost of safety
Thank you for your informative
lead article The cost of safety .
What is missing is a comparison
of those costs with the savings the
council cited because of the
Are the savings now in debit
(even without the cost of life and
I write in response to Free
advertising (January 17) about
the trailers with advertising on
I am very glad Mr Taylor raised
that issue. I agree with him.
I am disappointed in the answer
given by Mr Stavros and would
urge Mr Stavros to either remove
these trailers or, if it is in
accordance with the legislation,
make the person pay the correct
rates for this.
Personally I feel they do not
belong on the road. I have seen
such a trailer also on Brooklyn
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