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PRESENTATION TO
PORTFOLIO COMMITTEE FOR
ARTS AND CULTURE
FEBRUARY 2011
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”.
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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”.
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MORAL IMPERATIVE
&
VALUE CHARTER
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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
NFVF POSITIONING STRATEGY
Civil Society
•Political Communities
• NGO’s, CBO’s, FBO’s
• Lobby Groups
• Individual Actors
• Traditional Structures
• Emergent Structures
NFVF
The State
•National Government Departments
• Provincial Government Departments
• Statutory Bodies
Private Sector
•Investment
• Labour
• Industry
Associations
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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
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CONTENT STRATEGY (cont.)
South Africa
Investment
Foreign Cont
Local Content
C0 Production
Capital Outflow
Service and
Hospitality
Partnerships
Content
Service
Hospitality &
Entertainment
Digital Content
Indigenous
Capital
Formation
Content
Community &
Language
Service.
Entertainment
Capital
Formation
e-Governance
e-Learning
Digital Content
Animation
Games
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BUSINESS CASE
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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
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
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ANNUAL REPORT 2009/10 - HIGHLIGHTS
GOVERNANCE (Cont.)
• Effective Executive Controls
 Council
 Executive Committee (Exco)
 Audit Committee
 Human Resources Committee
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
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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
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ANNUAL REPORT 2009/10 - HIGHLIGHTS
TRAINING & DEVELOPMENT FOR THE
SECTOR
• Lionel Ngakane Scholarship Fund (2001 – 2010)
Total No. of bursaries
453
(81 % to PDI)
Black Female - 31%; White Female - 6%
Black Male - 50% ; White Male - 13%
• Trevor Jones Scholarship Fund
Total No. of bursaries
2
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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
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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
Black Female - 38% ; White Female - 31%
Black Male - 13% ; White Male - 18%
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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
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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 industrygraduates 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.
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
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TEN YEARS - HIGHLIGHTS
PRODUCTION & DEVELOPMENT OF
CONTENT (Cont.)
NO. OF PROJECTS FUNDED : 2001 - 2010
Production
Development
Total
Documentary
Features
Shorts
Animation
186
57
33
8
121
113
17
5
307
170
50
13
TV Series
0
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TEN YEARS - HIGHLIGHTS
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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.
TEN YEARS - HIGHLIGHTS
STATISTICS
RAND VALUES : 2001 – 2010
Total allocation received from DAC
Special project income – DAC
293 389 000
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
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TEN YEARS - HIGHLIGHTS
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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
TEN YEARS - HIGHLIGHTS
PERFORMANCE INDICATORS
UNOFFICIAL CO- PRODUCTION
Title
Tsotsi
Produced with
United Kingdom
Total Budget
R 22 200 000
South African Contribution
R 13 700 000
QSAPE
R 18 000 000
No. of jobs
197
Box Office
R 8 152 864
WW Revenue
R 42 000 000 ($6 million)
Awards
Winning an Oscar
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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 state
R 4 490 702
Total State contribution
R 13 700 000
% back to the state
32.78%
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TEN YEARS - HIGHLIGHTS
PERFORMANCE INDICATORS
SOUTH AFRICAN FILM
Title
White Wedding
Total Budget
R 4 665 604
DTI Contribution
R 1 632 961
No. of jobs
387
Box Office
R 4 971 581
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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
Vatable production amount
R 2 726 900
VAT on production
R
VAT on Box office
R 610 545
Total amount back to the state
R 1 381 324
Total State contribution
R 1 632 961
% back to the state
84.59%
388 800
381 979
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TEN YEARS - HIGHLIGHTS
PERFORMANCE INDICATORS
Republic of Korea
Population
South Africa
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%
Admissions
58.9 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
Films per annum
82
0.70%
$27.1 million
$5.5 million
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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
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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
Department of
Arts and Culture
NEED
• Greater investment
• Greater co-ordination
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.
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
Department of
Trade and Industry
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
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
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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
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TEN YEARS - HIGHLIGHTS
DEMAND STIMULATION & AUDIENCE
DEVELOPMENT
• SAFTA’s
 Entering 5th 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
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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
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TEN YEARS - HIGHLIGHTS
INTERGOVERNMENTAL & STAKEHOLDER
RELATIONS
• NFVF hosted an Intergovernmental Indaba in 2008
• The Indaba built cooperation on issues of the development of
and video in SA.
• Increased collaboration and strengthened relations between
IDC, DTI and provincial film commissions (GFC, CFC, DFO).
film
NFVF,
• NFVF has cooperation agreements with TUT and University of
Limpopo.
• Low budget model
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
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NATIONAL FILM AND VIDEO
FOUNDATION
Eddie Mbalo
• Finishing: 31 March 2011
Karen Son
• New Chief Executive Officer: 01 April 2011
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THANK YOU