SPI Annual Report CONTENTS Report from the Chair ............................................................................................................... 2 Report from the Chief Executive Officer................................................................................... 3 Screen Producers Ireland Overview ......................................................................................... 4 SPI Board 2014 .......................................................................................................................... 5 Committees 2014 .................................................................................................................... 11 SPI Executive & Corporate Structure ...................................................................................... 13 Industry Funding Overview ..................................................................................................... 15 SPI Financials ........................................................................................................................... 23 SPI Progress Report ................................................................................................................. 29 SPI Events List 2014 ................................................................................................................ 32 1 | Page SCREEN PRODUCERS IRELAND | 2014 ANNUAL REPORT Report from the Chair 2014 was my first year as Chairman of Screen Producers Ireland. As Chairman my focus has been maintaining the momentum and progress of SPI in meeting its objectives and ensuring it is an outward facing representative organisation. SPI must be ready and empowered to respond to the variety of challenges that present themselves in promoting and advancing the development of the independent production sector in Ireland. In 2014, the board approved a renewed SPI Strategy Statement for the period 2014 – 2016. In the context of the publicity around Corporate Governance last year, the board commissioned a corporate governance review and published the first SPI Corporate Governance Manual. Having a fiscal incentive for film and television production has been the bedrock of successive government strategies over the last 21 years. It is a policy that has been one of the main drivers to the expansion of activity levels and generation of significant inward investment for the sector. The knock-on effect of section 481 has been a ten- fold increase in full-time employment in those 21 years. Changes to the scheme were announced in 2013 and we were pleased that our efforts during 2014 were successful to ensure improvements to the scheme and the maintenance of the key component of the early payment mechanism was maintained. SPI continued to build on our good relationships with stakeholders through meaningful engagement and events. One of the key objectives of our strategy is to position SPI to be able to influence State organisations charged with developing the industry, to maximise its potential. Devising robust and well researched policies is crucial to this end. In 2014 we worked to develop clear policies on the range of issues. My focus in 2015 will be to ensure the SPI aims and policies are effectively communicated to Government and stakeholders. I want to thank the board for their contribution to the success of SPI last year and the clear leadership provided to the sector. I also want to thank those who served on the SPI committees and working groups who have been a great support to the work of the board in terms of appraising and evaluating the issues of importance and making recommendations. These activities have been foremost in ensuring that the domestic environment is conducive to growth of the independent production sector in Ireland. John Hennessy Chairman 2 | Page SCREEN PRODUCERS IRELAND | 2014 ANNUAL REPORT Report from the Chief Executive Officer In 2014 SPI continued its work as an advocate for independent producers and were able to deliver positive results for the sector despite ongoing difficult trading conditions for member companies. During 2014 we hosted thirteen events for members including briefings with RTÉ, TV3, SKY Arts and BAI Sound & Vision. At the direction of the board we completed a comprehensive corporate governance review and published the first SPI Corporate Governance Manual thereby improving procedures and transparency of our operations. We made changes to our internal IT systems which improved efficiencies and will provide cost savings going forward. We developed new SPI branding and a new website, creating tangible benefits for the membership. In 2014 and as a direct result of lobbying by SPI, RTÉ published its new Code of Fair Trading Practice and began to roll out contracts reflecting the fact that producers can now retain ownership of copyright in their productions. SPI held a number of information events in 2014 to inform members of this significant change in practice. In July the Revenue Commissioners published their e-briefing on the treatment for VAT purposes of independent commissions from RTÉ, TG4 and Sound & Vision fund grants. The e-brief brought clarity to a previous proposal from Revenue which threatened to reduce overall commissioning spend in the sector by €6.5M. We made urgent representations to the Revenue Commissioners, the Minister for Communications, Energy & Natural Resources and the Minister for Arts, Heritage and the Gaeltacht and the proposal was reversed. The subsequent Revenue e-briefing was welcomed by SPI and the sector as a whole. Early in 2014, SPI successfully defended a Labour Court case taken by SIPTU. The case sought to clarify the union's interpretation of the SPI/SIPTU Shooting Crew Agreement that all shooting crew had to be members of the union. This view was rejected and the Court clarified that membership of any union is a matter of choice for any individual. This was a welcome outcome for SPI. In 2013 the Government announced that legislative change would be made to Section 481 with effect from 2015. Principle amongst the amendments was a structural change from an investor led model offering up to 28% of eligible spend, to a corporation tax credit model. SPI were instrumental in lobbying for the increase in value to 32% of eligible spend. This ensures that Ireland remains internationally competitive for film and television production and maximises the benefit for indigenous production. We also played an integral role on the Section 481 Industry Technical Committee which was convened to advise Government on implementing the changes. As part of the Technical Committee, SPI successfully influenced positive change and outcomes for independent producers. The changes were approved by the Minister for Finance in December and signed into law in January 2015. S481 is fundamental to the production infrastructure in Ireland. The value of S481 projects certified has increased by approximately 25% year on year since 2011 indicating positive growth during what has been a difficult trading period for many other industries. The total value of S481 certified during 2014 was €231M. This represents an increase of 31% on the 2013 figure of €177M. This is a significant increase in the period, some of which may be accounted for by the change to the scheme between 2014 and 2015 and the fact that some projects certified in 2014 will not start principal photography until 2015. The biggest growth trend can be seen in TV Drama which experienced 195% increase in the value of S481 raised between 2011 and 2014. In the same period Animation grew by 22%, Documentary by 46% and Film by 48%. ( see pg 17 for full analysis). In December we were pleased to host a consultation for SPI members with Crowe Horwath so that member’s views could be considered in the context of developing the Irish Film Board Strategy for the next 5 years. Strong policy formation is the basis of our ability to drive change. In this regard, SPI is currently developing clear policies on issues of importance to the independent production sector. Communicating these policies to Government and the sector as a whole will help us become a stronger voice for independent producers. I would like to thank the board of SPI, the committees and working groups for their support to the executive during 2014. Lastly, we are a small team at SPI and I would like to take this opportunity to thank the staff for all their hard work and commitment to the SPI agenda. Barbara Galavan CEO 3 | Page SCREEN PRODUCERS IRELAND | 2014 ANNUAL REPORT Screen Producers Ireland Overview Screen Producers Ireland (SPI) is the representative organisation for independent production companies operating in Ireland in the film and television industry. As a membership organisation we promote growth and sustainability of a working environment conducive to a strong independent production sector. It is our duty to be the most effective voice of independent film, television, animation and digital producers in Ireland. We address the needs of the sector and using our knowledge and expertise we aim to deliver a strong and sustainable position for Irish production companies. We are focused on shaping an independent production sector that is comparable to best international standards. We encourage state organisations charged with developing the industry to put in place development plans and policies for the sector to maximise potential. We support the continuance of the Irish film and television production tax incentive, Section 481. We identify potential improvements