Denham Sadler
December 13, 2017

Another report ticks game fund

Games Sector

Another report ticks game fund

Apply here: Funding for the games sector has been dry since the 2014 horror budget

A new government report has recommended reinstating the games development fund, the third to do so since it was axed in the “horror” 2014 budget.

The House of Representatives Standing Committee on Communications and the Arts tabled its report on the Australian film and television industry late last week and recommended that the Australian Interactive Games Fund (AIGF) be reinstated.

The $20 million AIGF was axed in the 2014 budget with half of its cash still in the bank to the surprise and anger of the burgeoning Australian games industry.

Former Greens senator Scott Ludlam led a senate inquiry into the future of the games development industry. The committee tabled its report in April last year, recommending that the government introduce a funding scheme for games development based on the AIGF.

The government is still yet to formally respond to this report, nearly 18 months later. But Communications Minister Mitch Fifield has said that the response would be tabled before the end of the year.

A House of Representatives inquiry into innovation and creativity also recommended that such a fund be reintroduced in May this year.

The latest government inquiry was originally solely looking into the film and TV industry, but thanks to lobbying and a series of submissions from the industry, the games industry was eventually included too.

“The committee was advised that the games sector in Australia has huge potential for growth and would generate considerable economic returns if granted access to the same tax incentives as film and television and received direct funding from the government,” the report said.

“Evidence to the inquiry notes that there are impediments to the growth of this sector in Australia including an inability to access capital investment.

"There seems to be ample potential for the growth of Australia’s digital gaming industry due to the popularity of video games both at home and abroad.

"The committee therefore agrees that some direct funding should be available to the games sector from the federal government.”

Industry body Interactive Games and Entertainment Association (IGEA) led the push for games to be recognised as part of the inquiry, and said the recommendation demonstrates the huge potential of the sector in Australia.

“Even in an inquiry that was never intended to extend to video games, stakeholders in related creative and screen industries have nevertheless stepped up to voice their concerns that the Australian games development industry is not receiving any support from the federal government,” it said.

"The games development industry has consistently and irrefutably been neglected, forgotten and pushed to one side. We see this in the axing of the AIGF.

"We see this in the over 350 day late response from the government to the senate’s report into the future of the video games development industry."

The report places further pressure on the federal government to provide a policy package focusing on the local games development industry, with an announcement expected by the end of the year.

The Australian Interactive Games Fund (AIGF) was a $20 million fund launched in 2013, intended to run for three years. Its funding was administered and channeled through Screen Australia, and was split into two programs: the Games Enterprise and Games Productions.

The enterprise program provided up to $1 million to businesses for the operating costs and development of video games, with a minimum of a quarter of the cash being a loan and the rest a grant.

The production part was for the development of a single video game, providing up to $500,000, with any funding over $50,000 being a recoupable investment.

This meant that the fund was self-sustaining, IGEA said in its submission to the inquiry.

“Arguably one of the most important aspects of the AIGF was its self-sustaining nature - any money that was paid back into the fund after loan repayment or recoupment would then be used to help fund other developers through enterprise and program funding rounds,” it said.

The AIGF was axed by the federal government in the “horror” 2014 budget, with the remaining $10 million in the fund immediately cut.

“The axing of the AIGF was incredibly disappointing and disenfranchising for the Australian video games industry. The decision was made without warning, consultation or any attempt at understanding the purpose or structure of the program,” the AIGF said.

The local games industry representative body IGEA – the Interactive Games and Entertainment Association – was instrumental in ensuring games was part of the latest inquiry.

“Given the contribution video games development can make to the Australian economy, industry and the community in general, support for this sector from the federal government should be considered and should in fact by a part of the inquiry,” the organisation said.

It appears the industry was heard and we absolutely welcome the recommendation from the committee that the AIGF should be reinstated.”

In its submission, the IGEA noted that government funding is “crucial to its future growth and sustainability” due long development runways and a lack of revenue during these years.

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