1. 1 PRESENTATION TO PORTFOLIO COMMITTEE FOR ARTS AND CULTURE FEBRUARY 2011 PRESENTATION TO PORTFOLIO COMMITTEE FOR ARTS AND CULTURE FEBRUARY 2011

2. 2 VALUE CHARTER Articulates desirable ends about the structural objects of the film sector that are currently unevenly distributed in our society. Reminds us that film and video are not about “pacifying the nation with forms of escapism”.

3. 3 MORAL IMPERATIVE The charterist character of the “Value Charter” is encapsulated in the moral imperative which reads: “It is a national imperative to create facilities for ordinary South Africans to bear influence in the expression of their own images, thereby deepen democracy and create prosperity”. “The National Film & Video Foundation strives for the realisation of this noble ideal”.

4. 4 MORAL IMPERATIVE & VALUE CHARTER The Moral Imperative together with the Value Charter could be the basis for: Legitimate political engagement, Policy and programme formulation Consensus between the state, industry and citizens

5. 5 NFVF POSITIONING STRATEGY NFVF Political Communities NGO’s, CBO’s, FBO’s Lobby Groups Individual Actors Traditional Structures Emergent Structures Investment Labour Industry Associations National Government Departments Provincial Government Departments Statutory Bodies

6. 6 CONTENT STRATEGY In 2003, the Content Industry strategy was co-formulated by DAC, DOC, DTI, NFVF and SARS This strategy calls for a comprehensive strategic thrust that would create sustainable development and growth of the whole audiovisual content industry. Cabinet approved the Content industry strategy based on the Sectoral Programme Approach: Dti developed the Film and Television Production Incentive (Rebate) NFVF developed its Business case

7. 7 CONTENT STRATEGY (cont.) South Africa Investment Foreign ContLocal ContentDigital Content C0 ProductionIndigenous Capital OutflowPartnershipsCapital Formation Service and Hospitality Content Service Hospitality & Entertainment Content Community & Language Service. Entertainment e-Governance e-Learning Digital Content Animation Games

8. 8 BUSINESS CASE KEY OBJECTIVE The essence of the business case is that the NFVF has formulated programmes that will address critical issues of development and growth of the film industry as part of Cultural Industry Growth Strategy (CIGS) framework, the Macro Economic Reform Strategy (MRS), the Accelerated and Shared Growth Initiative for South Africa (AsgiSA), Industrial Policy Action Plan (IPAP) and New Growth Path

9. 9 ANNUAL REPORT 2009/10 - HIGHLIGHTS GOVERNANCE Unqualified Audit each year since NFVF’s establishment  Good financial and performance management systems and controls  Effective internal control function Annual Risk Assessments 3 year internal audit plan

10. 10 ANNUAL REPORT 2009/10 - HIGHLIGHTS GOVERNANCE (Cont.) Effective Executive Controls  Council  Executive Committee (Exco)  Audit Committee  Human Resources Committee

11. 11 ANNUAL REPORT 2009/10 - HIGHLIGHTS HUMAN RESOURCES HR Strategy  The HR Strategy is in line with the NFVF strategic direction. Performance Management  Talent Management and Mentorship Programme successfully developed and implemented Remuneration  Salary Increases based on DPSA and Performance Management Reviews

12. 12 ANNUAL REPORT 2009/10 - HIGHLIGHTS HUMAN RESOURCE (Cont) Employee Benefits  Comprehensive Provident Fund and Medical Aid Scheme Employment Equity and Workplace Diversity  Staff Complement of 26 92% Black 74% Females  67% Senior Management  76% Middle Management

13. 13 ANNUAL REPORT 2009/10 - HIGHLIGHTS TRAINING & DEVELOPMENT FOR THE SECTOR Lionel Ngakane Scholarship Fund (2001 – 2010) Total No. of bursaries453 (81 % to PDI) Black Female - 31%; White Female - 6% Black Male - 50% ; White Male - 13% Trevor Jones Scholarship Fund Total No. of bursaries 2

14. 14 ANNUAL REPORT 2009/10 - HIGHLIGHTS TRAINING & DEVELOPMENT FOR THE SECTOR (cont.) SEDIBA SKILLS DEVELOPMENT PROGRAMME Screenwriting programme  Spark for Narrative  Spark for Documentaries  Sediba Masters Programme International Financing Programme for Producers  Emerging  Masters

15. 15 ANNUAL REPORT 2009/10 - HIGHLIGHTS SEDIBA SKILLS DEVELOPMENT PROGRAMME Introduced in 2007 SPARK & MASTERS (2007 - 2010) No. of Scriptwriters trained 104 Black Female - 27%; White Female -10% Black Male - 52% ; White Male - 11% No. of Script editors trained 44 Black Female - 48% ; White Female - 11% Black Male - 34% ; White Male - 7% PRODUCERS PROGRAMME (2009/10) No. of Producers trained 18 Black Female - 38% ; White Female - 31% Black Male - 13% ; White Male - 18%

16. 16 ANNUAL REPORT 2009/10 - HIGHLIGHTS TRAINING & DEVELOPMENT FOR THE SECTOR (cont.) SHORT FILM CONTESTS  Indigenous Languages FATHER CHRISTMAS  Women Helmers SUPERHERO 25 Words or Less  JIMMY IN PINK  KHUMBA

17. 17 ANNUAL REPORT 2009/10 - HIGHLIGHTS TRAINING & DEVELOPMENT FOR THE SECTOR (cont.) Investigation into the Feasibility of Establishing a National Film School (NFS)  Conducted in terms of Section 2(e) of NFVF ACT between 2006 -2008.  Extensive consultation with DAC and DTI and discussed at Indaba 2009 with industry and government stakeholders.  Major findings of the study film education and training does meet the needs of the industry- graduates do not have the necessary skills for the industry. the industry is not yet transformed – Black graduates still struggle to find work and industry dominated by White owned companies and creatives.  The study recommends the establishment of a NFS for South Africa.  Way forward : continued advocacy for support and engagement with other departments and cluster.  Feasibility study to inform a business plan for the establishment of a NFS.

18. 18 TEN YEARS - HIGHLIGHTS PRODUCTION & DEVELOPMENT OF CONTENT Philosophy of P&D department  Understanding the SA market place  Encouraging work that resonates local audiences and addresses national imperatives.  Increasing volumes of scripts  Increasing volumes of productions  Developing sustainable businesses

19. 19 TEN YEARS - HIGHLIGHTS PRODUCTION & DEVELOPMENT OF CONTENT (Cont.) NO. OF PROJECTS FUNDED : 2001 - 2010 Production Development Total Documentary186 121 307 Features57 113 170 Shorts33 17 50 Animation8 5 13 TV Series0 24 24

20. 20 TEN YEARS - HIGHLIGHTS PRODUCTION & DEVELOPMENT OF CONTENT (cont.) Co-productions certified 5 active film co- production treaties with Canada, Germany, Italy, the United Kingdom and France Treaty with Australia signed but not yet active. NFVF certified 26 films with a production budget value of R680 million. SA financial participation amounts to R380m of the total production budgets for the 26 certified films. Of this amount R369,4m was spent in South Africa, qualifying for the Local and Co production Film and Television Incentive.

21. 21 TEN YEARS - HIGHLIGHTS STATISTICS STATISTICS RAND VALUES : 2001 – 2010 Total allocation received from DAC 293 389 000 Special project income – DAC 8 961 439 Other Revenue 33 210 231 Total Revenue 335 560 670 Total Grant Expenditure 248 405 206 Current annual allocation 38 859 000

22. 22 TEN YEARS - HIGHLIGHTS AWARDS Achievements by South African films Tsotsi – Oscar for Best Foreign Language Film Hotel Rwanda – 4 Oscar nominations Yesterday – 1 Oscar nomination Elalini – Oscar for Best Student Film U-Carmen e-Khayelitsha – Golden Bear, Berlin Wooden Camera – Silver Bear, Berlin Drum– The Golden Stallion & Best Art Direction, Fespaco Zulu Love Letter – European Union Prize & Best Actress, Fespaco Max and Mona – Best First Time Director (Feature), Fespaco Lion’s Trail– Emmy Award Skin – 4 international awards Izulu Lami– 4 International awards Shirley Adams – Best film, Locarno Father Christmas – Best Narrative Short, Tribeca

23. 23 TEN YEARS - HIGHLIGHTS PERFORMANCE INDICATORS UNOFFICIAL CO- PRODUCTION TitleTsotsi Produced withUnited Kingdom Total BudgetR 22 200 000 South African ContributionR 13 700 000 QSAPER 18 000 000 No. of jobs 197 Box OfficeR 8 152 864 WW Revenue R 42 000 000 ($6 million) AwardsWinning an Oscar

24. 24 TEN YEARS - HIGHLIGHTS PERFORMANCE INDICATORS UNOFFICIAL CO- PRODUCTION (cont) Total Budget R 22 200 000 Labour costs (1/3)R 6 000 000 PAYE R 1 500 000 Vatable production amount R 16 200 000 VAT on production R 1 989 474 VAT on Box office R 1 001 228 Total amount back to the stateR 4 490 702 Total State contribution R 13 700 000 % back to the state 32.78%

25. 25 TEN YEARS - HIGHLIGHTS PERFORMANCE INDICATORS SOUTH AFRICAN FILM TitleWhite Wedding Total BudgetR 4 665 604 DTI ContributionR 1 632 961 No. of jobs 387 Box Office R 4 971 581

26. 26 TEN YEARS - HIGHLIGHTS PERFORMANCE INDICATORS SOUTH AFRICAN FILM (cont) Total Budget R 4 665 604 Labour costs (1/3)R 1 555 201 PAYE (25%) R 388 800 Vatable production amount R 2 726 900 VAT on production R 381 979 VAT on Box office R 610 545 Total amount back to the stateR 1 381 324 Total State contribution R 1 632 961 % back to the state 84.59%

27. 27 TEN YEARS - HIGHLIGHTS PERFORMANCE INDICATORS Republic of Korea South Africa Population 48.5 million 47.7 million GDP $951.1 billion $282.6 billion Total Box Office $282.7 million $ 56.9 million Local films’ share 50.80% 0.70% Admissions 58.9 million $27.1 million Sites/Screens 348/2085 30/743 Pop. per screen 23 261 64 199 Ave. Ticket price $4.80 $2.10 Government Contr. $34 million $5.5 million Films per annum 82 10

28. 28 TEN YEARS - HIGHLIGHTS FINANCE & FUNDING FOR THE SECTOR Innovation initiatives  Co-Finance sourcing assistance e.g. OTELO BURNING  Business case for entity  Low budget model developed with IDC, DTI, SABC  Exhibition platform – business case

29. 29 A wide range of government interventions have had positive impact, but are neither large enough, nor integrated enough DTI rebate 35% rebate on SA qualifying films >R2.5m Total pool capped at R250m Pool can be exhausted by big co-productions & locations based foreign films ( 66% of all payouts have gone to servicing companies all of which are white owned.) IDC investment Equity investments of up to 49% of the budget of films Not able to support new entrants due to lack of structured financing experience. Difficulty of financing institution making decisions on creative merits of projects Commercial investment criteria skew support to large budget foreign films New Low-Budget pilot model could change the above drastically, but SABC participation is holding up the process. SABC advances and investment Investment driven by acquisition of TV rights for SA films No clearly defined film investment policy Desire to commission 100% leaving no upside for investors or producers NFVF production investment Production finance grants <R1m per film Sums typically too small to make material difference in maintaining creative input eg typically <5% of budget SARS 24f relief Provides tax relief for investment in SA owned films Highly complex for individual producers to access Previous abuse has led to restrictions making impractical for film usage Technical incompatibility with DTI rebate & other instruments that exist NEED Greater investment Greater co-ordination Department of Arts and Culture Department of Trade and Industry

30. 30 TEN YEARS - HIGHLIGHTS GLOBAL POSITIONING International Markets & Festivals South Africa is a competitor in the filmmaking value chain and so it becomes imperative that we exploit international platforms to position ourselves as:  Filmmaking nation  Filmmaking destination of choice  Co-producing partner of choice

31. 31 TEN YEARS - HIGHLIGHTS GLOBAL POSITIONING (cont.) International awards Provincial Film Commissions  Consolidated efforts toward positioning South African resources Durban Film Office; Cape Town Film Commission and Gauteng Film Commission

32. 32 TEN YEARS - HIGHLIGHTS DEMAND STIMULATION & AUDIENCE DEVELOPMENT SAFTA’s  Entering 5 th session of awards  Building talent and stars National Film Festivals  Durban International Film Festival  Kwa Mashu Film Festival  Encounters Documentary Film Festival  Tri-Continents Film Festival  Out in Africa Gay & Lesbian Film Festival,  Bafundi Student Film Festival  Nab’ubomi Schools Film Festival

33. 33 TEN YEARS - HIGHLIGHTS DEMAND STIMULATION & AUDIENCE DEVELOPMENT (cont.) Distribution (e.g SKIN)  Quadrupled expected box office revenue  Leveraged R20million in PR  Student outreach - National campaign for school pupils and research

34. 34 TEN YEARS - HIGHLIGHTS INTERGOVERNMENTAL & STAKEHOLDER RELATIONS NFVF hosted an Intergovernmental Indaba in 2008 The Indaba built cooperation on issues of the development of film and video in SA. Increased collaboration and strengthened relations between NFVF, IDC, DTI and provincial film commissions (GFC, CFC, DFO). NFVF has cooperation agreements with TUT and University of Limpopo. Low budget model

35. 35 2012 - 2025 NFVF received an additional R135m for 2012 - 2014 NFVF programmes are aligned to New Growth Path Programmes include :  Education & Training programmes that address skills gap  Increase resources to both script development & production  Introduction of 3 additional slate funds  Short film contest to launch careers of new entrants into the sector  Set up & support incubation programmes nationally  Support innovative distribution initiatives  Empower entrepreneurs from Previously Disadvantaged Communities to access the film industry

36. 36 NATIONAL FILM AND VIDEO FOUNDATION Eddie Mbalo Finishing: 31 March 2011 Karen Son New Chief Executive Officer: 01 April 2011

37. 37 THANK YOU