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Canada cuts leave more room for U.S.

Local production sector mulls ways to deal with less funding

MONTREAL — Thanks to provincial tax incentives, Hollywood producers have flocked to Canada. Now, ironically, reductions in funding from the federal government may make the nation a less hospitable place for its own makers of TV shows and films — and may result in pubcaster CBC needing to buy more programming from the U.S.

The Canadian government’s 10% cuts to federal film and TV funder Telefilm Canada, the CBC and the National Film Board of Canada — ordered March 29 to be implemented over a three-year period — have caused much fear in the local production industry.

More details of the CBC cuts surfaced in recent days, with the pubcaster announcing it would be airing 175 fewer hours of local programming, resulting in the loss of six original series.

TV producers are reeling from the news — and worst of all, they still don’t know which shows are being cancelled and which will be returning for the fall season on CBC.

But while there is no question there will be less coin for all projects — whether theatrical features, docs or TV series — some Canadian producers believe the cuts might be an opportunity to make some radical changes to the way films are funded in Canada.

“If I was Telefilm, I’d make less movies,” says David Gross, who produced “Goon,” a comedy about a minor-league hockey enforcer that’s become a huge hit in the Great White North, scoring more than $4 million at the box office in its home country, huge business considering that Canadian English-language productions continue to struggle at the box office. “I hope they fund less of the dicey, borderline movies.”

Gross added that if Telefilm wants to export movies, it should target more commercial pics.

Other producers see shared risk or scaled-back projects as ways to deal with the cutbacks.

“We’ll have to think of films that are more suited to co-productions,” says Pierre Even, producer of “Cafe de Flore” and “War Witch.” “We did that with ‘Cafe de Flore,’ but it doesn’t work with every film. Also, maybe we have to reduce our budgets. Or we’ll have to make fewer films.”

But Toronto-based producer Niv Fichman says a $10 million cut to Telefilm’s $100 million budget will have very little impact, in part because he believes Telefilm will be savvy about where it trims.

Telefilm announced that it will have to cut only $2.7 million the first year — trimming programs by $1.7 million and administration by $1 million. By the third year, Telefilm will be forced to cut 30 full-time positions to deal with the $10 million cut.

Fichman — whose credits include “Blindess” and “Hobo With a Shotgun” — says producers have to look toward finding financing outside Canada. “The only way to survive in Canada is to make films that relate to the world, because we have such a small market,” he says.

Fichman also points to the recently unveiled Telefilm Canada private fund as an example of how to find new coin to replace the diminishing public coin. The fund will allow Canadian companies to donate to Telefilm and receive tax deductions or credits. It is initially expected to have a modest annual budget of $5 million, but that could be increased.

Luc Dery, producer of “Incendies” and “Monsieur Lazhar,” sees the cuts as major, perhaps resulting in four or five fewer features produced every year. Dery suggests other funding options, including the Fonds Capital Culture Quebec, created late last year — a $100 million fund 60% financed by Quebec film funder Sodec and the Fonds de Solidarite FTQ, a union pension fund.

At CBC, $28 million will be cut the first year, escalating to $115 million by the third year. CBC CEO Hubert Lacroix estimates the pubcaster will face an additional overage each year of $85 million due to rising costs, so the overall budget hit will be $200 million. But CBC plans to increase revenues annually by $50 million, so the net budget reduction annually will be $150 million in the third year and the subsequent years.

Kirstine Stewart, veepee of English services at CBC, says there will be more repeats, less original production, and noted that English-lingo TV would take a $43 million hit.

“The cuts will invariably affect the amount of programming we commission on television for primetime, Stewart says. “Television is definitely taking the brunt of this cut.”

CBC is laying off 650 staffers. Public film studio NFB is eliminating 73 staff positions and closing its cinemas in downtown Toronto and Montreal. Ian Morrison, spokesman for the watchdog group Friends of Canadian Broadcasting, fears that the cuts to CBC will lead to the network buying more Hollywood fare. Right now, the primetime schedule is almost entirely Canadian.